Page 15 - CIMA SCS Workbook August 2018 - Day 2 Tasks

RISK MANAGEMENT (P3) - PRACTICE TASKS

EXERCISE 2

UPDATE

It is one day later and you have been checking twitter with your colleagues to see if there are any
more inappropriate tweets from any of the journalists at FNG when you receive this email from
Den Rice:

TRIGGER

Email

To: Senior Manager
From: Den Rice
Subject: Financing and fake news

Great work on those issues I asked you about yesterday, Guy has calmed down a bit now & Wilma
has spoken to both people on the phone. She’s arranged for them both to visit the FNG offices.

Unfortunately we have more issues to sort out, I think part of the reason Guy has decided not to
take any harsh action is because he just doesn’t have the time.

The bank has been in contact about our loans; they want to move all our debt to a fixed rate. I’m
concerned this could prove more costly with interest rates expected to fall, I’m not sure the rest
of the Board really understand the issue, so please could you prepare an explanation of interest
rate risk and the different hedging techniques available to FNG.

Secondly, following on from the social media issues, Guy has sent me the attached article which
he’d like to discuss at this afternoon’s Board meeting. I know fake news is mentioned on our risk
register, but what more could we do to control the threat of fake news at FNG?

TASK

Prepare an email in response to Den Rice’s requests (Time allowed: 60 minutes)

(Refer to the reference materials overleaf)

KAPLAN PUBLISHING 29