PRMIA 8004 - PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics

PRMIA 8004 Actual PDF
  • Exam Code: 8004
  • Exam Name: PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics
  • Updated: Sep 17, 2026
  • Q & A: 112 Questions and Answers
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PRMIA 8004 Exam Syllabus Topics:

SectionObjectives
Topic 1: Standards & Practices- Group of Thirty Best Practices, Global Derivatives Study Group
- Standards of Best Practice, Conduct and Ethics, PRMIA Ethics Committee
- Bylaws of Professional Risk Managers' International Association, PRMIA
- Principles of Good Governance Principles, PRMIA
Topic 2: Case Studies- Barings
- Long Term Capital Management (LTCM)
- WorldCom
- Metallgesellschaft
- Bankers Trust
- Silicon Valley Bank
- National Australia Bank (NAB) - FX Options
- Fannie Mae and Freddie Mac
- Northern Rock
- American Insurance Group (AIG)
- Washington Mutual (Wamu)
- Lehman Brothers
- FTX
- Orange County
- Operational Resilience at TSB

PRMIA PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics Sample Questions:

Question #1

Barings failed to recognize that Nick Leeson's losses were increasing because:

  • A. Leeson hid his trades in a suspense account
  • B. Leeson ran the front office
  • C. The London office did not ask for any reports
  • D. The margin report sent to London did not show the true margin needs
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

Question #2

When local rules and regulations conflict with the PRMIA Standards of Best Practice, Conduct and Ethics the PRMIA member should ...

  • A. Respect local rules and regulations
  • B. Seek advice from a qualified party, being mindful of legal and confidentiality requirements
  • C. Ignore local rules and regulations
  • D. Modify the interpretation of local rules and regulations to meet the situation
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

Question #3

Which of the following should NOT be part of the Risk Management Infrastructure?

  • A. Define the organization's definition of risk management as articulated by the Board in clear and uncertain terms
  • B. Be independently staffed and report to an employee who is on the Executive Committee (Operating Committee) but who is NOT a business unit leader
  • C. Include financial risk management, compliance and external reporting and, to the extent that resources allow, should exclude legal or accounting
  • D. Review continually the application of the Principles of Good Governance to the Risk Management Infrastructure, financial accounting and reporting infrastructure and the organization as a whole
Reveal Solution  Discussion  0

Correct Answer: D  🗳️

Question #4

As a PRMIA member, you have certain responsibilities. Among these are the requirement(s) to:

  • A. Vote in Board elections
  • B. Adhere to the PRMIA Standards of Best Practice, Conduct and Ethics
  • C. Attend at least one PRMIA chapter meeting per year
  • D. All of the above
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

Question #5

Corporate Governance ...

  • A. Eliminates risk to the greatest extent possible
  • B. Is defined as the assembled knowledge and wisdom of the collective stakeholders in the organization, set to maximize shareholder value
  • C. Is defined as business decision making predicated on a belief in potential rewards, balanced with the knowledge, understanding and appreciation of the risk taken to pursue those potential rewards
  • D. Is defined as that which is best practiced within an enterprise risk management framework, guided by the PRMIA Standards of Best Practice, Conduct and Ethics above all else
Reveal Solution  Discussion  0

Correct Answer: C  🗳️

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