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Appendix 2

What controls could GP put in place to resolve the issues described?
Select all that apply

A JL should be supervised by someone who understands the work she
does.

B The work of chief trader and settling trades should be carried out by
different people.

C Error accounts with balances should have an independent reviewer.

D JL and her team should all be reassigned to new roles outside of the
treasury and banking division.

E Increase the bonus payment to encourage them to work harder.

F Remove the bonus payment completely.

42 A bank has an estimated portfolio of $150 million.

The standard deviation is $6 million per day.

What is the one day value at risk based on a 95% certainty?

A $180 million

B $9.87 million

C $5.7 million

D $9.38 million

43 Chronologic Ltd started trading 8 months ago; they have had an incredibly
successful start to business life, despite only having a few employees. The
management and staff have worked extremely hard, often putting in several
hours overtime each day to make the venture work.

The management believe that the current workload is unsustainable and are
looking to bring in extra staff. One of the areas they have identified as important
is internal controls. They believe that as the company grows it is imperative that
an internal controls system should grow with them.

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