BSBRSK501 Manage Risk - Knowledge Test

This document contains prompt questions related to risk management. It covers topics such as research methods, risk likelihood, risk consequences, risk action plan, AS/NZS ISO 31000:2009, legislation, and insurance. The questions are designed to assess the candidate's understanding of the management of risk. The document also includes learner instructions and specifications for the assessment task.

BSBRSK501 Manage risk
Learner Instructions 4
(Knowledge test)
Submission details
Students Name
Student ID
Group
Assessor’s Name
Assessment Date/s
The Assessment Task is due on the date specified by your assessor. Any variations
to this arrangement must be approved in writing by your assessor.
Submit this document with any required evidence attached. See specifications below
for details.
Performance objective
You are required to demonstrate understanding of a wide range of questions to
assess your underpinning knowledge of the management of risk.
Assessment description
For this task you are required to demonstrate an understanding of standards and
legislation relevant to risk management, and the management of risk across an
organisation in a range of contexts.
Procedure
You are required to:
1. Review the written questions provided
2. Provide written responses to the questions
3. Submit your responses in the agreed timeframe.
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Specifications
You must provide:
 written responses to all questions provided.
Your assessor will be looking for:
● evidence that you understand the required legislative requirements
● evidence that you understand risk management practices in the business
sector.
Candidate: I declare that this work has been completed by
me honestly and with integrity and that I have been
assessed in a fair and flexible manner. I understand that the
Institute’s Student Assessment, Reassessment and
Repeating Units of Competency Guidelines apply to these
assessment tasks.
Signature: ___________________
Date: ____/_____/_____
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Prompt questions
1. What are three ways that research can be conducted for risk-related issues?
For each way, briefly describe how it may be done
The three available options for research are qualitative analysis, semi-quantitative
analysis and quantitative analysis. Qualitative analysis will be beneficial when in
depth screening is required for identification if risk. This is due to the reason that in
the case of the qualitative risks, data and information are being used. On the other
hand, semi-quantitative analysis will be beneficial in identifying more quantitative
value based data in regards to the identified risks. These values cannot be
identified in with the help of the qualitative analysis. Moreover, this analysis will be
more realistic compared to the outcome of the qualitative data. The last option is
the quantitative data, which involves extensive usage of data and numerical. This
can be more effective in analyzing the data from the primary sources and align the
outcome with that of the risk identification. Thus, it can be concluded that each of
these research options are effective from different perspectives.
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2. Fishbone checklists and brainstorming are both tools that can be used in risk
management. Describe each of these and when they would best be use
Fishbone diagram is also known as cause and effect diagram and it is
being used to visualize the potential reasons for any issues along with
the identifying the root causes. Checklists refer to the tool that can help
the stakeholders in reviewing all the relevant factors in respect to the
risks. On the other hand, checklist can also help the stakeholders in
matching the desired outcome and process with the actual scenario.
Thus, the probability of getting the job done properly is more.
Brainstorming is used for generating new ideas in mitigating the risks.
However, in this case, analysis is not being involved as in the checklists.
In the current business scenario, the approaches of the risks are getting
diversified and thus innovative mitigating ideas are important for
preventing them. In this case, brainstorming can help in generating
variety if ideas in short time.
3. What are the five stages of risk likelihood? Briefly describe each one.
The five stages of risk likelihood are almost certain, likely, possible,
unlikely and rare. In the case of almost certain, the risks that are likely
to happen are being identified. In addition, risks with having most
frequent probability are also categorized in this section. Likely refers to
the risks, which are having probability of getting emerged but not in
persistent manner. Thus, risks with having lower chances are
categorized under this section. The next parameter is possible, which
includes the risks with having occasional likelihood. These risks may
happen or not without any surety. The next parameter is unlikely, which
includes the risks that are not expected to happen or having lower
probability. The last one is rare, which denotes the risks that are having
least probability of getting emerged or highly unlikely to get happened.
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4. List and give an example description for each of the five levels of
consequence for risk
The major five level of risk consequences are:
Extreme consequences: the risk is having extreme and highest level of
impact on the stakeholders and in other relevant areas. Moreover, these
consequences can have huge loss and damage to the concerned parties.
Example: end products being offered got banned by the authorities due
to a few issues.
Major consequences: the risk is having high level of impact but not to
the level of the extreme consequences. Thus, the intensity will be less to
the previous one but still having higher impacts. Example: level of
corporate tax got increased for the business organizations.
Moderate consequences: the risk is having moderate impact on the
concerned parties and not to the level of extreme and major
consequences. Example: damage in employee relationships.
Minor consequences: the risk is having minimal consequences such as
reduction in sales for single month.
Insignificant consequences: the risk is having no impact at all such as
resignation by an employee.
5. What needs should be considered when treating risk? List and describe three
treatments that could be considered.
There are important factors that should be considered in treating risks
and some of them are increasing the potential benefits by extending the
likelihood of the risks. This is due to the reason that if the probability of
the risk can be extended to high level to moderate level of chances, then
the favorable outcome will be more from the process. Another need is
managing the probable consequences in order to reduce the unfavorable
outcomes. Thus, outcome should be made more positive as much as
possible. The next need is sharing of the risk. This is also an effective
option due to the reason that the more will be the shareholders of the
risk, the less will be the responsibility with each of the stakeholders. This
is due to reason that if the risks can be segregated then the probability
of gaining positive outcome will be more.
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6. What should be included in a risk action plan? Describe the key inclusions and
briefly the type of information included with each inclusion.
Some of the elements that are being included in the risk management
plan and action plan are the risk, risk rating, mitigation activities, and
roles of the involved stakeholders, timeline of the different actions to be
implemented and monitoring agreement for evaluation the
effectiveness. All these points are should be included in the risk action
plan.
7. How does the AS/NZS ISO 31000:2009 Risk management – principles and
guidelines standard assist organisations to reduce risk?
One of the major benefits of the International Risk Management standard
AS/NZS ISO 31000;2009 is gaining the guidance and standards in terms
of implementing the of risk management plan. Different organizations
are having different sets organizational situations and thus it is
important for them to have some sort of guidance, which can be
provided by the international risk management standards. In addition, it
is also important for the business organizations to review their
effectiveness of the risk management plan and modifying accordingly. In
this case also, international risk management standard can be beneficial
for the organizations. The effectiveness of the entire process can be
measured with this.
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8. For each of the pieces of legislation listed, describe the intent of each and how
it could impact on the process of managing risk.
a. Privacy law.
b. WHS regulations.
c. Contract law.
Privacy law
It deals with the flow of personal information between the individuals
and is being practiced in Australia. This law looks after the different
elements such as disclosure of information and access to the private
documents. This law is being initiated by the office of the Australian
information commissioners.
WHS regulations
There are number of elements being included in the WHS regulations
such as the workplace health and safety act, codes of practices and
regulations. All these elements are being initiated in gaining the desired
level of safety and health in the workplace and preventing the workplace
risks.
Contract law
Contract law is responsible for managing the different elements of
contracts such as formation of the contracts, avoidance of the
contractual risks and termination of the contracts. Thus, the involved
stakeholders can have each and every of the factors important in
contracts and will help them in mitigating the risks in contract.
9. Name and give an example for three adjustments that can be made in the
workplace to assist a person with a disability.
One of the major adjustments can be in terms of training and
development activities. This is due to the reason that if the person is
disable in terms of vision then he can be provided with audio notes,
which he can hear and take the training notes accordingly. Another
example can be in terms of providence of the equipments. There are
number of equipments such as telephone typewriter and different
software can be used in assisting the person with disability. For
example, with the help of the communication channels, physically
impaired person will not have to walk in distances to others. Another
example is in the forms of Braille, which will help the visually impaired
person in getting different things by feeling. For instance, Braille
inscription in the lift button can help the visually impaired person in
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operating it.
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10. List two types of insurance an organisation could consider purchasing, and for
each type, describe the risks covered by the insurance and the benefit to the
organisation.
One of the major beneficial insurances will be volunteers workers
personal accident, which will cover the accidental injury and death of
the internal stakeholders. Thus the organization will not have the
responsibility and liability in meeting the compensation for the victim
rather it will be provided by the third party insurance vendors. Thus, it
will reduce the cost and liability of the organizations. Moreover, the
workers will also feel protected and supported by having this cover to
their physical health.
Another insurance that can be effective and benefited to the
organizations is public liability. This can help in protecting the internal
stakeholders ranging from the upper level managers to the lower level
employees from any third party damages. Thus, it will help the
organizations to get protected from any third party incidences and cost
involved in the process.
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