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SOUTH AFRICAN QUALIFICATIONS AUTHORITY 
REGISTERED UNIT STANDARD THAT HAS PASSED THE END DATE: 

Explain the nature of risk and the risk management process 
SAQA US ID UNIT STANDARD TITLE
14995  Explain the nature of risk and the risk management process 
ORIGINATOR
SGB Financial Services 
PRIMARY OR DELEGATED QUALITY ASSURANCE FUNCTIONARY
-  
FIELD SUBFIELD
Field 03 - Business, Commerce and Management Studies Finance, Economics and Accounting 
ABET BAND UNIT STANDARD TYPE PRE-2009 NQF LEVEL NQF LEVEL CREDITS
Undefined  Regular  Level 4  NQF Level 04 
REGISTRATION STATUS REGISTRATION START DATE REGISTRATION END DATE SAQA DECISION NUMBER
Passed the End Date -
Status was "Registered" 
2003-10-08  2006-10-08  SAQA 0150/03 
LAST DATE FOR ENROLMENT LAST DATE FOR ACHIEVEMENT
2007-10-08   2010-10-08  

In all of the tables in this document, both the pre-2009 NQF Level and the NQF Level is shown. In the text (purpose statements, qualification rules, etc), any references to NQF Levels are to the pre-2009 levels unless specifically stated otherwise.  

This unit standard is replaced by: 
US ID Unit Standard Title Pre-2009 NQF Level NQF Level Credits Replacement Status
242658  Demonstrate knowledge and application of the nature of risk and the risk management process  Level 4  NQF Level 04  Complete 

PURPOSE OF THE UNIT STANDARD 
This Unit Standard is a basic introduction to risk management. It introduces the risk management process and the fundamentals of risk in a business environment. It is intended for learners who manage asset risk in insurance and other organisations.

The qualifying learner is capable of:
  • Explaining the concept of risk in risk management.
  • Demonstrating knowledge and understanding of the risk management process.
  • Explaining methods of managing risk.
  • Developing a risk management model. 

  • LEARNING ASSUMED TO BE IN PLACE AND RECOGNITION OF PRIOR LEARNING 
    There is open access to this Unit Standard. Learners should be competent in Communication and Mathematical and Financial Literacy at NQF Level 3. 

    UNIT STANDARD RANGE 
    The typical scope of this Unit Standard is

    Risk in small, medium and large commercial enterprises, including, but not limited to manufacturers, distributors, retailers and service organisations. 

    Specific Outcomes and Assessment Criteria: 

    SPECIFIC OUTCOME 1 
    Explain the concept of risk in risk management. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    1. The concept of risk is explained for three different contexts. 

    ASSESSMENT CRITERION 2 
    2. The concept of uncertainty is explained with examples. 

    ASSESSMENT CRITERION 3 
    3. The consequences of risk are explained with reference to damage to assets, consequential losses, financial losses and legal liability. 

    ASSESSMENT CRITERION 4 
    4. Three events that could constitute a risk are named in terms of hazards and perils. 

    SPECIFIC OUTCOME 2 
    Demonstrate knowledge and understanding of the risk management process. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    1. Four ways of identifying a risk are named and an indication is given of when each
    method is appropriate. 

    ASSESSMENT CRITERION 2 
    2. The concept of probability is explained and an indication is given of how probability can be measured for three examples. 

    ASSESSMENT CRITERION 3 
    3. The concept of severity is explained and an indication is given of how severity can be measured for three examples. 

    ASSESSMENT CRITERION 4 
    4. The concept of estimated maximum loss is explained with examples. 

    ASSESSMENT CRITERION 5 
    5. The concept of maximum probable loss is explained with examples. 

    ASSESSMENT CRITERION 6 
    6. Risk control measures are described for three different scenarios. 

    ASSESSMENT CRITERION 7 
    7. Financial techniques for managing risk are explained with reference to contractual transfer and transferring, hedging and funding the risk. 

    SPECIFIC OUTCOME 3 
    Describe methods of managing risk. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    1. The role of management in managing risk is outlined with reference to senior, middle and first line management. 

    ASSESSMENT CRITERION 2 
    2. The use of policies and procedures as a means of managing risk is explained with examples. 

    ASSESSMENT CRITERION 3 
    3. The management of risk is explained in terms of communication, reporting lines, allocated resources, financial provision and organisational resources. 

    ASSESSMENT CRITERION 4 
    4. The importance of audit reports and the measurement of compliance are explained with examples. 

    SPECIFIC OUTCOME 4 
    Develop a total risk management model. 

    ASSESSMENT CRITERIA
     

    ASSESSMENT CRITERION 1 
    1. A risk profile is developed for three different scenarios. 

    ASSESSMENT CRITERION 2 
    2. Possible risk finance options are investigated for each scenario. 

    ASSESSMENT CRITERION 3 
    3. A model for managing risk is proposed for a specific situation. 

    ASSESSMENT CRITERION 4 
    4. The proposed model is compared to an existing model in terms of cost of risk. 


    UNIT STANDARD ACCREDITATION AND MODERATION OPTIONS 
    1. Anyone assessing a learner against this Unit Standard must be registered as an assessor with the INSQA or with a relevant ETQA that has a Memorandum of Understanding with the INSQA.
    2. Moderators must be registered as assessors with the INSQA or with a relevant ETQA that has a Memorandum of Understanding with the INSQA.
    3. Any institution offering learning that will enable achievement of this Unit Standard or assessing this Unit Standard must be accredited as a provider with the INSQA or with a relevant ETQA that has a Memorandum of Understanding with the INSQA.
    4. Moderation of assessment will be overseen by the relevant ETQA according to the moderation guidelines in the relevant qualification and the agreed ETQA procedures.

    Anyone wishing to be assessed against this Unit Standard may apply to be assessed by any assessment agency registered with the INSQA or with a relevant ETQA that has a Memorandum of Understanding with the INSQA . 

    UNIT STANDARD DEVELOPMENTAL OUTCOME 
    N/A 

    UNIT STANDARD LINKAGES 
    N/A 


    Critical Cross-field Outcomes (CCFO): 

    UNIT STANDARD CCFO IDENTIFYING 
    Learners are capable of identifying and solving problems in which responses show that responsible decisions using critical and creative thinking have been made in proposing a risk management model for a specific situation. 

    UNIT STANDARD CCFO ORGANISING 
    Learners are capable of collecting, organising and critically evaluating information in developing risk profiles and investigating finance options. 

    UNIT STANDARD CCFO COMMUNICATING 
    Learners are capable of communicating effectively in analysing an existing risk management model and comparing it to a proposed model. 

    UNIT STANDARD CCFO DEMONSTRATING 
    Learners are capable of seeing the world as a set of related systems in identifying proposing a risk management model. 

    UNIT STANDARD ASSESSOR CRITERIA 
    N/A 

    UNIT STANDARD NOTES 
    This unit standard has been replaced by unit standard 242658, which is "Demonstrate knowledge and application of the nature of risk and the risk management process", Level 4, 4 Credits. 

    QUALIFICATIONS UTILISING THIS UNIT STANDARD: 
      ID QUALIFICATION TITLE PRE-2009 NQF LEVEL NQF LEVEL STATUS END DATE PRIMARY OR DELEGATED QA FUNCTIONARY
    Core  49129   Further Education and Training Certificate (FETC): Management and Administration  Level 4  NQF Level 04  Reregistered  2023-06-30  SERVICES 
    Core  48493   National Certificate: Financial Services: Wealth Management  Level 4  NQF Level 04  Passed the End Date -
    Status was "Registered" 
    2007-02-11  Was INSETA until Last Date for Achievement 
    Core  24396   National Certificate: Risk Management  Level 4  NQF Level 04  Passed the End Date -
    Status was "Registered" 
    2006-10-08  Was INSETA until Last Date for Achievement 
    Core  60652   Professional Qualification: Management and Administration  Level 4  Level TBA: Pre-2009 was L4  Reregistered  2021-06-30  As per Learning Programmes recorded against this Qual 
    Elective  48640   National Certificate: Financial Services Management  Level 4  Level TBA: Pre-2009 was L4  Reregistered  2023-06-30  INSETA 


    PROVIDERS CURRENTLY ACCREDITED TO OFFER THIS UNIT STANDARD: 
    This information shows the current accreditations (i.e. those not past their accreditation end dates), and is the most complete record available to SAQA as of today. Some Primary or Delegated Quality Assurance Functionaries have a lag in their recording systems for provider accreditation, in turn leading to a lag in notifying SAQA of all the providers that they have accredited to offer qualifications and unit standards, as well as any extensions to accreditation end dates. The relevant Primary or Delegated Quality Assurance Functionary should be notified if a record appears to be missing from here.
     
    1. Discovery Life Ltd 
    2. Faisit (Pty) Ltd 
    3. Intec College 
    4. Invuya Institute of Learning (Pty) Ltd 
    5. Masifunde Training Centre (Pty) Ltd 



    All qualifications and part qualifications registered on the National Qualifications Framework are public property. Thus the only payment that can be made for them is for service and reproduction. It is illegal to sell this material for profit. If the material is reproduced or quoted, the South African Qualifications Authority (SAQA) should be acknowledged as the source.