1. Fullerton financial services, inc. is a small co that provides investment advice and invests money on behalf of clients, which are primarily small businesses and non-profit organizations in orange county. The company has been in operation for 5 years and has 6 employees, including the founder who owns the company. The company rents an office in beautiful downtown Fullerton and owns the office furniture and equipment used in the business. The company invests approximately $10 million of CLIENT'S funds in short-term corporate bonds.  You have been asked to advise Fullerton financial services, inc. on its risks. Your first step is to identify and describe one of each of the following types of risk that this company faces: hazard, financial, operational, and strategic.

 

2.  In general (not necessarily the specific risk you identified above), which TYPE of risk (hazard, financial, operational, or strategic) represents the greatest threat to Fullerton financial services, inc? select only one risk type. and explain your choice. 

 

 

3.  The COSO approach to ERM is a very thorough and detailed approach.  What is the greatest danger for a firm that relies on this approach?

 

4.  Four components of a publicly traded computer software company are its investors, its management, its employees, and its customers.  In a principal-agent situation, which of these components would be considered the principals?  Which would be the agents?

 

5.  A university has determined that two key risk indicators that are critical for maintaining their desired ranking are the percentage of accepted candidates that decide to enroll in the university and the percent of students who graduate within 6 years of enrolling. 

 ILLUSTRATE (do not just describe in words) how this information could be displayed for the senior administrators of the university in a risk dashboard format.