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Unit of competency details

FNSRSK612 - Determine and manage risk exposure strategies (Release 1)

Summary

Usage recommendation:
Current
Mapping:
MappingNotesDate
Supersedes FNSRSK602 - Determine and manage risk exposure strategies 30/Jun/2020

Release Status:
Current
Releases:
ReleaseRelease date
1 1 (this release) 01/Jul/2020


Qualifications that include this unit

CodeSort Table listing Qualifications that include this unit by the Code columnTitleSort Table listing Qualifications that include this unit by the Title columnUsage RecommendationRelease
FNS60920 - Advanced Diploma of ParaplanningAdvanced Diploma of ParaplanningCurrent1-2 
FNS60822 - Advanced Diploma of Integrated Risk ManagementAdvanced Diploma of Integrated Risk ManagementCurrent1-2 
FNS60720 - Advanced Diploma of Financial Licensing ManagementAdvanced Diploma of Financial Licensing ManagementSuperseded1-2 
FNS60222 - Advanced Diploma of AccountingAdvanced Diploma of AccountingCurrent
FNS50322 - Diploma of Finance and Mortgage Broking ManagementDiploma of Finance and Mortgage Broking ManagementCurrent
FNS51120 - Diploma of General InsuranceDiploma of General InsuranceCurrent1-6 
FNS60820 - Advanced Diploma of Integrated Risk ManagementAdvanced Diploma of Integrated Risk ManagementSuperseded
FNS50922 - Diploma of Banking Services ManagementDiploma of Banking Services ManagementCurrent
FNS60722 - Advanced Diploma of Financial Licensing ManagementAdvanced Diploma of Financial Licensing ManagementCurrent
FNS50920 - Diploma of Banking Services ManagementDiploma of Banking Services ManagementSuperseded
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Classifications

SchemeCodeClassification value
ASCED Module/Unit of Competency Field of Education Identifier 080399 Business And Management, N.e.c.  

Classification history

SchemeCodeClassification valueStart dateEnd date
ASCED Module/Unit of Competency Field of Education Identifier 080399 Business And Management, N.e.c.  13/Aug/2020 
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Unit of competency

Modification History

Release 

Comments 

Release 1

This version first released with FNS Financial Services Training Package Version 4.0.

Application

This unit describes the skills and knowledge required to analyse risk factors for financial products, determine appropriate risk exposure management strategies, communicate these strategies to relevant staff and intermediaries, and manage the risk assessment strategies. It is aimed at setting the strategy for portfolio managers, including the types of business to target.

It applies to individuals who use specialised knowledge, systematic approaches and analytical skills to provide leadership in managing strategic organisational activity in financial services organisations.

Work functions in the occupational areas where this unit may be used are subject to regulatory requirements. Refer to the relevant regulator for specific guidance on requirements.

Unit Sector

Risk management

Elements and Performance Criteria

ELEMENT 

PERFORMANCE CRITERIA 

Elements describe the essential outcomes.

Performance criteria describe the performance needed to demonstrate achievement of the element.

1. Determine risk assessment strategies

1.1 Identify and evaluate criteria for acceptance or rejection of risks using standards for risk management as indicated by regulators

1.2 Determine organisational performance targets and capacity to assess and accept risk

1.3 Identify business risk and control risk elements of an organisation

2. Review risk and compliance factors

2.1 Identify and collate information on business and control risk elements

2.2 Investigate and review the data and information

2.3 Evaluate risk elements against known exposure factors and compliance where relevant with legislation, regulatory guidelines, industry sector compliance requirements and organisational policy

2.4 Evaluate risk acceptability factors within context of organisation’s mitigating capabilities and organisational requirements

2.5 Critically analyse risk considerations in the business strategic planning process in line with appetite

3. Develop risk acceptance criteria

3.1 Establish terms and conditions of risk acceptance criteria to satisfactorily cover organisational needs and risks

3.2 Document risk acceptance strategies, criteria and guidelines that meet requirements within delegated authorities

3.3 Obtain and review feedback on risk acceptance strategies, criteria and guidelines

3.4 Finalise risk acceptance criteria, and associated authority limitations, conditions and guidelines

4. Assess operational capital management risk

4.1 Develop fit for purpose capital models that meet regulatory requirements and organisational policies and procedures

4.2 Review risk profile and calculate potential operational risk exposure

4.3 Monitor internal and external losses and re-assess inherent risk and capital requirements

4.4 Undertake internal and external reporting to market and regulatory bodies

5. Assess impact and implement risk acceptance strategies

5.1 Identify and develop procedures and guidelines that staff should follow to adhere to risk acceptance strategy

5.2 Communicate risk assessment strategies, criteria, procedures and guidelines to relevant staff and intermediaries

5.3 Monitor risk acceptance strategy implementation

6. Review risk assessment strategies

6.1 Determine effectiveness of risk acceptance strategies in meeting risk management objectives

6.2 Document and communicate results to relevant staff

Foundation Skills

This section describes those language, literacy, numeracy and employment skills that are essential to performance but not explicit in the performance criteria.

Skill 

Description 

Numeracy

  • Collates, interprets and analyses financial and statistical information to determine requirements

Oral communication

  • Participates in verbal exchanges using active listening and questioning techniques to convey information, obtain feedback and elicit the views and opinions of others
  • Articulates clearly, using concepts and language specific to the audience, and adapts tone and pace to engage and present information to others

Reading

  • Critically analyses complex documentation from a variety of sources and consolidates information relating to specific criteria to determine requirements

Writing

  • Uses clear and concise language, spelling and grammar, and terminology to convey information and provide detailed instructions
  • Prepares logically organised documents using specific formats for the audience and purpose

Teamwork

  • Uses a variety of communication tools and strategies in building and maintaining working relationships

Initiative and enterprise

  • Uses formal analytical thinking techniques to identify or predict issues and generate possible solutions
  • Explores and incubates new and innovative ideas through unconstrained analysis and critical thinking

Planning and organising

  • Plans strategic priorities and outcomes within a diverse environment exposed to competing demands
  • Gathers and analyses data and seeks feedback to improve plans and processes
  • Makes high impact decisions in a complex and diverse environment, using input from a range of sources

Self-management

  • Works autonomously, making high level decisions to achieve and improve organisational goals
  • Takes a lead role in the development of organisational goals, roles and responsibilities
  • Monitors and reviews organisational policy, procedures and adherence to legislative requirements

Technology

  • Uses digital systems and technologies to enter, store or access information
  • Adopts new and emerging technologies to complete work tasks

Unit Mapping Information

No equivalent unit. Supersedes and is not equivalent to FNSRSK602 Determine and manage risk exposure strategies.

Links

Companion Volume Implementation Guide is found on VETNet - https://vetnet.gov.au/Pages/TrainingDocs.aspx?q=c7200cc8-0566-4f04-b76f-e89fd6f102fe

 

Assessment requirements

Modification History

Release 

Comments 

Release 1

This version first released with FNS Financial Services Training Package Version 4.0.

Performance Evidence

The candidate must demonstrate the ability to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including evidence of the ability to:

  • determine and manage risk exposure strategies for at least two different types of financial products.

In the course of the above, the candidate must:

  • establish processes to communicate and manage implementation
  • establish processes to monitor, review and assess the effectiveness of the risk exposure strategy
  • consult and communicate with appropriate stakeholders.

Knowledge Evidence

The candidate must be able to demonstrate knowledge to complete the tasks outlined in the elements, performance criteria and foundation skills of this unit, including knowledge of:

  • key features and purpose of standards for risk management as indicated by regulators
  • the key features of actuarial and financial principles and processes related to risk exposure strategies
  • industry hazards and risk exposures
  • methods of risk assessment, prevention, and application
  • key features of establishing risk acceptance criteria for low and high hazard risk areas, including meeting market conditions, and accepted levels of exposure within organisations
  • key organisational products and services, and associated risks and liability loss exposures
  • different forms that strategy process implementation may take in an organisation
  • internal and external operational risks
  • operational capital management
  • types of inherent risks
  • key features of industry sector legislation, organisational and regulatory guidelines, and compliance requirements required to produce the performance evidence
  • organisational policy, procedures, guidelines and authorities related to risk management.

Assessment Conditions

Skills in this unit must be demonstrated in a workplace or simulated environment where the conditions are typical of those in a working environment in this industry.

This includes access to:

  • office equipment, technology, software and consumables
  • legislation, regulations and codes of practice required to produce the performance evidence
  • standards for risk management as indicated by regulators.

Assessors of this unit must satisfy the requirements for assessors in applicable vocational education and training legislation, frameworks and/or standards.

Links

Companion Volume Implementation Guide is found on VETNet - https://vetnet.gov.au/Pages/TrainingDocs.aspx?q=c7200cc8-0566-4f04-b76f-e89fd6f102fe