Financial Crime & Conduct

CISI Operational Risk

Master the principles of operational risk management, Basel frameworks, cyber security, and regulatory compliance required for the Level 3 CISI Operational Risk qualification.

250 Practice Questions Detailed Study Notes Realistic mock exams

Course syllabus information reviewed for 2026. Always check the awarding body’s latest official syllabus and candidate updates before booking or sitting your exam.

Exactly what is included

250 practice questions across 5 mock exams · unlimited retakes
Focus Learn · key areas, pitfalls, exam traps & key numbers
Flashcards · fun, fast and effective recall
Exam cheat sheet · key facts, rules and numbers by chapter
AI Analyzer & Mentor · pinpoints your weak areas
Study Mode Exams · learn while you train
AI Chat trained specifically for this exam
Study material organised by syllabus

Syllabus

Module 1: Element 1: Risk Basics 3 marks out of 50

Core principles of risk and risk management.

• Risk vs Uncertainty
• The Risk Management Process
• Risk Appetite, Capacity, and Tolerance

Module 2: Element 2: Other Major Risks 7 marks out of 50

Definitions of Credit, Market, Liquidity, and other risks.

• Market risk, Credit risk, Liquidity risk.
• Systemic risk and moral hazard.
• Reputational and Strategic risk.

Module 3: Element 3: The Nature of Operational Risk 20 marks out of 50

Operational risk definitions, causes, and resilience.

• Basel definition of Operational Risk
• Internal fraud, external fraud, employment practices
• Direct vs Indirect operational losses
• Operational Resilience

Module 4: Element 4: The Causes and Impacts of Operational Risk 4 marks out of 50

Understanding why operational risk events occur.

• Inadequate or failed internal processes
• People risk (human error, fraud)
• Systems failures and external events

Module 5: Element 5: Operational Risks Arising in the Trade Cycle 5 marks out of 50

Risks associated with execution, settlement, and corporate actions.

• Pre-trade, Execution, and Settlement risks.
• Corporate actions (mandatory vs voluntary).
• Payment systems (CHAPS, BACS, SWIFT).

Module 6: Element 6: The Support and Control Functions 7 marks out of 50

The role of support functions in mitigating operational risk.

• Human Resources and IT support
• Compliance, Internal Audit, and Risk Management
• The Three Lines of Defence model

Module 7: Element 7: Operational Risk in the Regulatory Environment 4 marks out of 50

Basel Accords and operational-risk capital methods.

• Basel Accords (I, II, III, IV/3.1)
• Pillar 1, 2, and 3 frameworks
• DORA, SFDR, Consumer Duty, SM&CR

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Free CISI Operational Risk Practice Questions & Exam Preview

Try 15 CISI Operational Risk practice questions from The Nature of Operational Risk

Practice CISI Operational Risk exam questions with answers and explanations. The full course includes 5 mock exams and chapter study tools.

Exam Preview

The Nature of Operational Risk

Question 1 of 15

An international bank is drafting its new operational risk policy to define risk appetite and establish boundaries between operational, market, and credit risk. The Chief Risk Officer proposes that the policy only be signed off by the heads of each division to ensure local buy-in. According to best practices in operational risk management, what is the primary flaw in this approach?

1 / 15

Flashcards

Card 1 of 10Element 1: Risk Basics

Question

How does the Basel Committee on Banking Supervision (BCBS) formally define Operational Risk?

Tap to reveal answer

Focus Learn

Key Examinable Areas5

Distinguish likelihood from consequence in a risk definition.
Classify credit, market, liquidity and operational risk in practical scenarios.
Explain what Invesco, PPI, LIBOR, HSBC, Bank of Bangladesh and other named events show about controls.
State ERM's four practical aims and its firm-wide scope.
Explain why common definitions, data and culture matter to ERM.

Common Pitfalls to Avoid3

Exam Traps3

Key Numbers3

Chapter 1: Risk Basics

Risk is the possibility of an adverse consequence, not the certainty that an event will occur. A firm therefore considers both the likelihood of an event and what it would lose if the event happened. In financial services, the four broad categories are credit, market, liquidity and operational risk. Credit concerns a borrower or counterparty failing to meet an obligation. Market risk concerns adverse changes in financial-instrument values. Liquidity has an asset side (a position cannot be sold promptly at a reasonable price) and a funding side (the firm cannot meet payments when due). Operational risk concerns losses from inadequate or failed processes, people, systems or external events. One incident can engage several categories, so identify the actual cause and consequence before choosi…

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Open every chapter’s key areas, pitfalls, exam traps and key numbers.

Adaptive study tools

Focus weak topics, learn with feedback, then switch to exam conditions.

Practice modes

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Learn with feedback, then switch to exam conditions.

Study Mode

Instant feedback & explanations

See the answer and explanation after each choice.

Exam Mode

Realistic exam simulation

Use the timer, keep answers hidden, then review your result.

Preparation Package at a Glance

Feature	Exams Academy	Details
Access Period	Lifetime Access	One-time enrollment with no recurring fee
Practice Exams	Unlimited Retakes
Study Support	Instant 24/7 AI Tutor	Self-service AI support; live instructor support is not included
Cost	$151 (One-Time)	One-time payment with no recurring subscription

Preview & See What You Will Get

Frequently Asked Questions

The CISI Operational Risk syllabus specifies 50 multiple-choice questions in 60 minutes. Our mocks use a 70% practice target; the public syllabus does not state an official pass mark.

It is primarily taken by professionals in risk management, compliance, and internal audit looking to solidify their understanding of operational risk and the Basel frameworks.

The course is based on CISI Operational Risk Edition 26 and syllabus Version 22, examinable from 20 September 2025 to 19 September 2027. It includes cyber resilience and the Basel III standardised approach.

You get lifetime access from the moment of purchase. Study at your own pace with no time limits or recurring fees.

Yes! Test your knowledge and review detailed explanations with the free CISI Operational Risk Mock Exam Preview below. It contains 15 exam-style questions from one named topic; the full course provides complete mock exams and syllabus coverage.

Key Benefits

Source-Led Chapter Summaries

Review the seven workbook chapters with explanations, pitfalls and key distinctions.

✓ Edition 26 workbook basis.
✓ Seven chapters in official source order.
✓ Exam traps and worked regulatory-capital method.

Strategic Mock Exams

5 full exams replicating the 50-question, 60-minute Operational Risk format.

✓ Proportional chapter weighting across all 7 chapters.
✓ Scenario and recall questions covering workbook concepts.
✓ Instant feedback with detailed explanations.

250 practice questions across 5 mock exams

250 practice questions across five mock exams, aligned to the current syllabus.

✓ Covers Basel frameworks, Pillar 1, 2 & 3.
✓ Cyber risk, AML, and regulatory capital methods.
✓ Senior Managers Regime and PRA/FCA dual regulation.

AI Exam Mentor

Your private tutor grounded in the Operational Risk course content.

✓ Explains the Basel III standardised approach, BIC and ILM clearly.
✓ Clarifies the difference between Risk Appetite and Risk Tolerance.
✓ Available 24/7 for immediate support.

Exam Format & Details

Assessment	50 multiple-choice questions
Duration	60 Minutes
Practice mastery target	70%

Operational Risk with Smart Practice

This is a complete exam simulation system designed to help you master the CISI Operational Risk syllabus from Basel frameworks to cyber risk.

We've distilled the regulatory concepts, capital-method distinctions, and internal governance frameworks into a dynamic learning environment that adapts to your needs.

Who Is This For?

✓ Operational Risk Analysts and Managers

✓ Compliance officers

✓ Internal Auditors

✓ Anyone needing to pass the CISI Operational Risk exam efficiently

Preparation centre

Use these connected guides for the syllabus, exam format, booking and revision strategy.

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Exam guide