QUESTION 9 Governments require some banks to conduct stress tests of their financial situation. What type of financial regulation is this requirement? A. Assessment of risk management B. Restrictions on competition C. Consumer protection D. Disclosure requirements

QUESTION 9 Governments require some banks to conduct stress tests of their financial situation. What type of financial regulation is this requirement? A. Assessment of risk management B. Restrictions on competition C. Consumer protection D. Disclosure requirements

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter3: Internal Control Over Financial Reporting: Responsibilities Of Management And The External Auditor

Section: Chapter Questions

Problem 2CYBK

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Concept explainers

Regulation of Commercial Banks

The main function of any commercial bank is accepting deposits and lending money to borrowers. Apart from these two activities, commercial banks provide a host of other services to their customers, like discounting bills of exchange, acting as a custodian of a customer's will, and so on. In the absence of a proper regulatory framework or proper regulations in place, the commercial banks would have ended up charging exorbitant or varied rates of interest or service charges on the funds loaned by them or the services performed by them.

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QUESTION 9

Governments require some banks to conduct stress tests of their financial situation. What type of financial regulation is this requirement?

A.

Assessment of risk management

B.

Restrictions on competition

C.

Consumer protection

D.

Disclosure requirements

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