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PRMIA 8004 exam : PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics

8004 Exam Simulator
  • Exam Code: 8004
  • Exam Name: PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics
  • Updated: Nov 05, 2026
  • Q & A: 112 Questions and Answers
  • PRMIA 8004 Q&A - in .pdf

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PRMIA 8004 exam simulator

PRMIA 8004 Exam Syllabus Topics:

SectionWeightObjectives
Topic 1: PRMIA Standards of Best Practice, Conduct and Ethics30%- Professional integrity and accountability
- Ethical decision-making framework
- Compliance with laws and regulations
- Code of professional conduct
Topic 2: PRMIA Case Studies50%- Risk management lessons learned
- Historical risk failure analysis
- Root cause identification
- Application of risk principles to scenarios
Topic 3: PRMIA Principles of Good Governance20%- Board and senior management responsibilities
- Transparency and disclosure
- Risk governance frameworks
- Risk appetite and accountability

PRMIA PRM Certification - Exam IV: Case Studies; Standards: Governance, Best Practices and Ethics Sample Questions:

Question #1

Barings Bank and Orange County have many similarities. Which of the following is NOT a similarity?

  • A. Both losses grew over time, but were not discovered by management until too late.
  • B. Both losses were eventually exposed by massive margin calls.
  • C. Both traded in illiquid and obscure markets that were easy to manipulate.
  • D. Both relied on a star manger, supposedly in a low risk business.
Reveal Solution  Discussion  0

Correct Answer: C  🗳️

Question #2

A risk manager is asked to analyze the credit risk of a convertible bond. The risk manager has never analyzed convertible bonds, but does have significant expertise in credit risk. The risk manager accepts the assignment, finds a paper on the subject through the PRMIA web site and copies the method used there. The risk manager completes the assignment and delivers a report to his or her direct supervisor and the supervisor is quite pleased.
According to the PRMIA Standards of Best Practice, Conduct and Ethics (Code of Conduct), this was acceptable behavior if the following conditions were met:
I The risk manager disclosed the lack of knowledge about convertible bonds II The methodology employed is disclosed and explained III The report was just to be used for analysis and not in practice IV The risk manager was sure of his/her understanding of the paper found on the web

  • A. I, II and III
  • B. I and II
  • C. I, II and IV
  • D. I only
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

Question #3

When supervising others, a PRMIA member must comply with

  • A. PRMIA Standards
  • B. his / her established personal standards of work approved in previous work situations
  • C. the standards of the organization where the work is being performed
  • D. local regulatory authority standards which may be less onerous than PRMIA standards
Reveal Solution  Discussion  0

Correct Answer: A  🗳️

Question #4

Which is NOT part of the guidance on Professional Conduct in the PRMIA Standards of Best Practice, Conduct and Ethics (Code of Conduct)?

  • A. Clearly inform all affected parties of any apparent or actual conflicts of interest
  • B. Report to the Regulator any departures from generally accepted methodology or practices
  • C. Know and abide by applicable rules and regulations
  • D. Provide advice that is clear and accurate
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

Question #5

According to the Group of 30 Report, option contracts:

  • A. Create no credit risk, since the buyer need not exercise the option
  • B. Create credit risk only for the buyer (due to default by the seller) provided the premium is due, and paid, at contract initiation
  • C. Usually create credit risk only for the seller (to default by the buyer)
  • D. Always generate credit risk to both counterparties
Reveal Solution  Discussion  0

Correct Answer: B  🗳️

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