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Subject P2: Advanced Management Accounting
CHAPTER 13 – RISK MANAGEMENT
13.1 Match the risk terms below to the appropriate definitions
The level of risk the organisation is willing
Risk appetite
to accept
The way in which the organisation
Risk capacity
manages its risk
The level of risk the organisation can
Risk attitude
tolerate
The way in which the organisation
Risk Strategy
manages its risk
13.2 Company A has decided to abandon its operations in a politically volatile
country where the risks of loss (including loss of life) are considered to be too
great, or the costs of security are considered to be too high.
When using the TARA framework, what is this an example of?
A Acceptance
B Transference
C Avoidance
D Reduction
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