Bus Prin and Prac Flashcards
To serve their organizations effectively, security managers must understand
Business principles
What type of training works best in the security industry
Mentoring
What is a concrete specification of products or services, level of quality, and other tangible aspects of the business, as well as a communication of business functionality and operational methods?
Mission
Which of the following is not one of the three standard, financial reports?
Notes to financial statement
What is NOT one of the three key reasons business people make unethical choices?
Greed
What is the first step in establishing a financial strategy?
Identify expected margins
What is a specific description of where the business will be in the long-term, and a general understanding of the business, its culture, and its future goals?
Vision
What is the foundation for training
Education
Who of the following is the author of the motivational theory which specifies two types of employees: Theory X employees who must be prodded to work, and Theory Y employees are naturally motivated?
Douglas McGregor
_______ bonds protect against employee dishonesty, while _________ bonds guarantee a contract.
Fidelity and surety
A ______________ is the cornerstone of an ethics program.
Mission statement
What is the most important aspect of personnel selection?
A face-to-face interview
How often should formal and informal performance appraisals be conducted?
Formal: Annually , Informal: Bi-annually
Relative to organizational objectives, what is “SMART”?
Specific, measurable, attainable, relevant, time-bound
_______________ budgeting is a process where only funds for justified expenditures are provided.
Zero-based
If a security function doesn’t result in more revenue than is possible without it, it should be
Reduced or eliminated
Which of the following is NOT a learning domain?
Intellectual
Which of the following BEST describes the document that tells how much money an organization generates (revenue), how much it spends (expenses), and the difference between those figures (net income)
Income statement
The practice of borrowing capital to purchase assets that can increase revenue is called which of the following?
Leveraging
In most cultures, this is the closest thing to a universal guideline or Golden Rule: to treat others the way one would want to be treated. This guiding principle works for both individuals and organizations. This BEST describes which of the following?
Business ethics
By using what kind of knowledge, security managers can organize their efforts in a way that best supports the overall vision and mission of their organization?
Business knowledge./ Principles
Who are those that are recognized as the effective security manager within the organization?
Those that are recognized within their organization as business partners
At some point a business must determine the type of product or service to sell and how to develop, deliver, and finance that output. To manage this process successfully, what managers and owners must employ?
Practices that support the goals of their business
What security managers must develop that define success and support business decisions?
Metrics
To be successful in business, what managers should understand?
The types of customers they serve, the financial requirements of the business, and ways to coordinate staff efforts
What kind of tool can be studied to determine whether the business processes accurately reflect the organizational strategy?
Key metrics and performance indicators
Feedback from what kind of tools allows an organization to change the implementation of the strategy or even shift the strategic focus itself?
Basing on the feedback from key metrics and performance indicators
What a business must understand and what need to create that support it
A business must understand its purpose and create management practices that support it.
What serves as the foundation for developing business processes
The organizational strategy.
What basically defines why the business exists and how it will maintain itself as a profitable, viable entity
The organizational strategy
While developing strategy, what is first step to understand?
The first step is to understand the business and where it needs to be in the future
How it is possible to tailor daily operations of a business to support the organizational strategy
By applying management principles
What kind of test the objective must pass through
A test called SMART (Specific, Measurable, Attainable, Relevant, and time‐bound).
To meet its objectives and implement its strategy, a business must pay attention to its primary resource. What is the primary resource?
Its people
What can help communicate the organizational strategy?
The vision, mission and objectives
What mission of the business specifies
The mission of the business specifies its types of products or services, level of quality, and other tangible aspects of the business and its plans
What is the most visible component of the HR department
Staffing
How an effective job requirements analysis can be done
Through candidate profiles, and effective interviews and evaluations
What kind of requirements the job requirements analysis must address
The job requirements analysis addresses both direct and indirect requirements. The direct requirements are those that the candidate must meet to understand and function in the position. The indirect requirements are skills that will increase the candidate’s likelihood of success
How staffing decision in an organization should be measured
Against a detailed job requirements analysis
What type of analysis should weigh which skills are most valuable for the position
The job requirements analysis
For the position filling in an organization, what elements the heads of security need to communicate to the HR staff responsible for recruiting
About the primary security function requirements and other skills requirements
How to appeal to the best candidates
To appeal to the best candidates, a company must impress them just as much impress the company
While conducting interview of candidate, what the interviewer should examine from a candidate
The candidate’s objective capabilities and subjective fit with the team the candidate would work with
What is the best way to recruit a good candidate
Internal recommendations
What the HR department must establish to outline the direction how business will be conducted at the organization
Must establish policies and procedures
When developing policies in an organization, what is useful to do
It is useful to work closely with the managers whose teams will be most affected by the policies.
What can help to prevent confusion within the organization
Clearly articulating company procedures
What should reflect the ideal functionality of the organization
The policies and procedures
What policies cover in an organization
Policies cover items that the organization monitors and expects employees to confirm to.
What procedure deal in an organization
In an organization, procedures deal with specific items‐for example, how an employee should handle setting up vacation time
What nature of training help employees to do their jobs better
Internal training
The metrics for evaluating employees should align closely with what element of the organization
With the organizational strategy
What employers must to do to aid employee development and retention
Employers must review and reward employee performance and provide training mechanisms for employee growth
Why companies use performance metrics and training modules
To foster employee development
How employees should be measured
How they do their current jobs and how well they contribute to the growth of the company as a whole
What is the second most valuable resource in an organization after its employees
Corporate knowledge
What can enable one department to learn from the processes, technologies, and ideas of another?
Cross‐unit knowledge sharing
What kind of difficulties a company might face if its growth is funded from internal cash reserves?
That could limit the ability of an organization to pay bills if costs exceed revenues
How a company can improve margins
It can reduce costs or increase the price of its product or service
What is possible to develop from the financial analysis
It is possible to develop budgets and set expected goals for revenue or return on investment (ROI).
What is the basis of financial management
Understanding the accounting principles used in generating financial reports.
Through what management practices in an organization are largely expressed
Through human resource management, knowledge management, and business structure
In an organization, if the organizational strategy emphasizes volume over profitability, then what should be metrics of measurement?
An important metric will be growth in revenue
What is the initial step in determining right structure for an organization
The initial step is to identify the essential business units
Central knowledge systems can be used as a tool of measurement and what it enables us to do in the organization
It enables an organization to identify problems and spot opportunities to cut costs, increase efficiency, or expand the business
What can be the metrics to identify how well employees are doing their current jobs?
Metrics for assessing how well employees are doing their current jobs include:
1‐work quality,
2‐ performance on time,
3‐ performance within budget,
4‐ meeting of other requirements of the position
What can be the metrics for assessing employee’s overall contribution to the company?
Metrics for assessing employee’s overall contribution to the company include:
1‐extra sales, extra hours, and work on several projects,
2‐ work on tasks outside the position requirements,
3‐ contribution toward improvements in the business process,
4‐ leadership.
How to make financial decisions and project returns
Through analysis of financial statements
Through analysis of financial statements. What is the purpose of GAAP
The purpose of GAAP is to establish and maintain a standard for financial reporting that can be used across all organizations
What are those three financial reports or statements have become accepted as standard?
The income statement, balance sheet, and statement of cash flows
What are the costs included in the costs of goods
Costs of goods sold include the cost of creating a product or service, accounting for materials, labour, and other costs
What the balance sheet summarizes
The balance sheet summarizes an organization’s investing and financing
When the shareholders are accountable for the extended liability
If the liabilities of an organization far outweigh the assets, then shareholders are accountable for the extended liability
What do you mean by retained earnings
Retained earnings equal the amount of net income that is reinvested in an organization.
How it is possible to determine what a company owns and what it owes in the short term and long-term
Through understanding the asset and liability mix
What is the equation of balance sheet
The equation of balance sheet: asset equal to liabilities plus shareholder equity
How accumulated depreciation can be defined
Accumulated depreciation defines as buildings and equipment age, they begin to lose value. The loss of value with each year is captured in accumulated depreciation to more accurately reflect the book value of an asset
What kind of cash flow can be found in a cash flow statement
The cash flow statement shows:
1‐ net operating cash flow,
2‐ net investing cash flow,
3‐ financial cash flow
What financial tool provides insight into the company’s use of profit to increase shareholder equity
The balance sheet
What is called leveraging
The practice of borrowing capital to purchase assets that can increase revenue is called leveraging
Name the different measures of margins
There are different measures of margins which are:
1‐ gross profit margin,
2‐operating margin,
3‐ net profit margin
What is the difference between return on assets and return on equity
Return on assets (ROA) measures how well a company makes profit on assets it already owns; return on equity (ROE) measures a company’s effectiveness at using loans to generate profit
What the operating margin demonstrates in a company
In an organization, operating margin demonstrates the company’s overall operating efficiency in producing and selling a product
When it can be said that the company is more efficient to producing a product
When the higher the gross profit margin
When an organization is more profitable
When the larger the margin of net income
What are the two earning related ratios are commonly examined in financial analysis
Two earning related ratios are commonly examined in financial analysis which are:
1‐earning per share (EPS),
2‐ price to earnings (P/E).
What can be helpful for comparing performance against expected values in an industry or against an organization’s historical performance?
The ratios of financial statements
What is risk
Risk is an estimate of the probability that investors will gain or lose money
What is return
Return is the amount of money an investment choice will give back to an investor
How it is possible to identify where cash is being generated to cover business operations
By understanding basic inflows and outflows of net operating cash flow, net investing cash flow and financing cash flow.
Which ratio is useful in determining whether an organization is fairly valued and also used to value private shares If an investor is thinking of purchasing an interest in a private organization?
The price to earnings ratios
What is the primary limitation of financial statement analysis
It does not directly consider changes in market conditions
While doing the financial risk analysis what are the risk rations are used
In the financial risk analysis, several risk ratios are used which are:
1‐ current ratio,
2‐ quick ratio,
3‐ debt to equity ratio
What are the limitations of financial statement analysis
The limitations of financial statement analysis are:
1‐ it does not directly consider changes in market condition,
2‐all organizations operate differently,
3‐ all organizations target different markets,
4‐ the financial ratios are derived from numbers presented in financial reports, and those report must be accurate for the ratios to have any meaning.
What may be the cause for continued declined in profit margin?
May be a result of poor economic conditions rather than poor company operations
Which ratios examine the company’s ability to cover short‐term obligations
If the current ratio is greater ratio is greater than one, the company has the ability to cover all its current liabilities with its current assets. Current ratio
Which ratio is also called as acid test
The quick ratio is also known as the acid test
What the financial analysis basically focuses
Financial analysis focuses on whether a company will have the ability to cover expenses and operating costs in the near term as well as long term.
What is the more practical strategy for developing budget
A more practical strategy for developing budget is a combination of both where the lowest level of input will occur at the divisional or department level so that executive management can determine a realistic budget that is in line with the overall financial objectives of the company.
What businesses need to generate to meet budget requirements
To meet budget requirements, businesses often need to generate a certain amount of revenue as well as limit spending to predetermined amount
What is one of the main purpose for understanding financial accounting and financial analysis?
To establish budgets
What the term management system refers
The term management system refers to the organization’s method of managing its processes, functions, or activities
How any financial strategy must be implemented and overseen to be effective
With appropriate controls
At department and unit levels, how budget items are listed
Budget items are listed in greater detail
The budget of a company must be aligned with what
With the company’s financial strategy
How the return on the implementation of an effective security countermeasure can be measured
By applying efficiency versus cost, or cost versus benefit, ratio to show the long‐range cost savings to the company. Also in some cases the insurance premiums are lower when risk decreases
The implementation of financial strategy depends greatly on what
Depends greatly on clear communication of the strategy, it purposes, and its expected results
Write the equations of ROI
ROI=Investment value at end of period/ investment value beginning of period‐1;ROI= Initial investment plus interest earned (or lost)/Initial investment‐
What is the benefit by communicating the strategy to employees, investors, vendors, suppliers, and other stakeholders
It boosts confidence and makes it possible for all to focus on creating success from the strategic direction
What is the effective way to compare the desirability of different ways of spending
Calculating the return on investment (ROI)
What is the effective way to set value of line items
An effective way to set the value of line items is to look at each budget expense as an investment and then calculate the expected return on that investment. In other words, one looks at the benefit of the investment divided by the cost‐in simpler terms, cost/benefit.
What is zero‐based budgeting
Zero‐based budgeting is a process wherein funds are placed in a budget only to extent that planned expenditures are justified in detail
What tool provides a factual basis for decision making and a system for continual improvement?
A management system
How a management system helps to an organization
Management systems are tools to help an organization meet its goals, whether in terms of quality, environmental concerns, safety, security, preparedness, or continuity
The most management system is based on which model
Based on the plan‐Do‐Check‐Act (PDCA or Deming Cycle) model.
Which are the really issues of making the organization successful
Management will better understand security issues, and security professionals will better understand management issues, which are really the issues of making the organization successful
What a management systems standard is likely to lead
Some specific outcomes that a management systems standard is likely to lead to include better organizational performance through improved capabilities, strategic alignment of improvement activities at all levels of the organization, the flexibility to react quickly to opportunities and a changing environment and optimization of resources.
How the process should be approached in an organization
From a business point of view with a continual improvement perspective
How it is possible to focus on problems that are manageable and for which one can effectively develop a system
By understanding and prioritizes the issues most important to the organization
What is emphasized by plans for response management programs
Reducing an incidents impact and quickly returning to full operation
What state and constitute a commitment to the protection of critical assets as well as commitment to continuous improvement
The security policy
. Protecting an organization’s assets is a daunting task. The business world, the security arena, and life itself are changing at lightning speed. So what are the major factors influences on how security professionals must perform their mission
Globalization, information technology, instant communications, complex and a symmetric threats, public opinion, mergers and acquisitions, conglomerates and partnerships, and regulation all have a major influence on how security professionals must perform their mission
In larger view of assets protection, what type of assets a security professional should consider to protect?
The larger view of assets protection, however, also considers intangible assets, such as an organization’s reputation, relationships, and creditworthiness
When the greatest protection of assets occurs
The greatest protection of corporate assets occurs when an appropriate mix of physical, procedural, and electronic security measures is in place in relation to the assets being protected. This creates an effective defense‐in‐depth asset protection program
As a security professional how we should balance security costs while protecting the assets of an organization?
Need to balance security costs with the benefits of protective measures employed
While designing asset protection program, as a security professional what type of additional aspects need to be considered
However, several additional aspects of assets protection emerged as well: Both tangible and intangible assets must be considered, a key objective is maintaining smooth business operations, post‐ incident business or mission continuity is an important element, both the current and future risk environments must be considered, providing a safe and healthy environment should be factored in, liability reduction/management is an important component.
While designing asset protection for an organization what is essential to know?
What needs to be protected
What do you mean by convergence of security
Integration of traditional and information [systems] security functions
In asset protection program who basically draw conclusions regarding the most appropriate protection strategies and applications
Asset owners and security professionals
When the concepts, techniques, tools, and philosophies of assets protection change?
The concepts, techniques, tools, and philosophies of assets protection change as threats mutate, technologies advance, management approaches develop, and business around the world becomes transformed
What is the primary objective of asset protection in relation to risk?
To manage risks by balancing the costs and benefits of protection measures
What are those three concepts form a foundation for any assets protection strategy
The five avenues to address risk, balancing security and legal considerations, and the five Ds.
What is called the five Ds security approach
Deter, deny, detect, delay and destroy
Many security principles and procedures are common across sectors, geographical areas, and various sizes and types of organizations; However what influence asset protection
Each particular industry has its own culture, environment and issues that influence assets protection.
What are the forces that shaping the practices of assets protection
Technology and touch, globalization in business, standards and regulation, convergence of security solutions, homeland security and the international security environment
When planning for security, what a professional should always consider
The culture of the organization
How adversaries are proficiently using globalization against on organization
By using the free flow of money, people, and technology
In today’s global society, what has been described as the centrepiece of a comprehensive assets protection program
The establishment of standards and guidelines
What do you understand by convergence of security solutions
In assets protection, convergence generally means the integration of traditional and IT security functions. A broader definition might consider convergence to be the merging of disciplines, techniques, and tools from various fields for the purpose of protecting critical assets
What are the elements assets protections managers must employ to protect intangible assets
Assets protection managers must also employ traditional information security, personnel security, technical security, and public relations and other external communications to protect intangible assets
The success in the asset protection field depends on what
The success in the asset protection field depends on the proper balance of three managerial dimensions, technical expertise, management ability, and the ability to deal with people.
What are the basic functions of managing jobs
Planning, organizing, directing, coordinating and controlling
What asset protection manager must understand before adopting an organizational structure
The assets protection manager must understand the purpose and mission of assets protection at the enterprise before adopting an organizational structure
What is the most crucial question need to be asked in defining business purpose and mission
Who is the customer
. How greater security team effectiveness can be achieved in an organization
By taking a more comprehensive view of who the customers are and how best to meet their needs can result in greater security team effectiveness
What are the important tools used in crime prevention program
Planning, management, and evaluation.
What do you mean by span of control
Limited number of staff members effectively. The specific number depends on such factors as the nature of the work and type of organization, but as a general rule one manager can effectively supervise up to 10 people
As a rule of thumb the senior security or assets protection professional should report to whom in an organization
The rule of thumb is that the senior security or assets protection professional should be placed as high as possible in the structure of an enterprise and report directly to senior or executive management
What Maslow’s theory recommend
Maslow’s theory is still widely recommended to analyze individual employee motivation strategies and establish tailored rewards, such as pay, recognition, advancement, and time off
Explain McGregor’s Theory X and Theory Y theory
They lack creative ambition, must be goaded, require constant supervision, and are motivated by fear. Theory Y states that workers are naturally motivated and want to work hard and do a good job. It assumes that workers are thoughtful, eager to perform well, and willing to be guided and taught. McGregor stresses that programs based on Theory Y are more successful than those based on Theory X
Explain Herzberg’s Motivation‐Hygiene Theory
Frederick Herzberg’s motivation‐hygiene theory is based on the premise that the opposite of satisfaction is not dissatisfaction but simply no satisfaction. The theory maintains that two sets of factors determine a worker’s motivation, attitude, and success. The second set is job context (hygiene), such as the surroundings, physical work conditions, salary, co-workers, and other factors that are external to the work itself. Hygiene factors (such as a fresh coat of paint on the wall) will be able to move an individual from a state of dissatisfaction to no satisfaction, but only motivation factors can move that person from no satisfaction to satisfaction. The lesson is that managers should avoid quick fixes. Manipulating hygiene factors may alleviate dissatisfaction but will not result in a state of satisfaction. Allowing an individual to reach a state of satisfaction requires changes in the work content itself, such as increased autonomy or responsibility.
When asset protection programs get success
An asset protection program gets its success when it cultivates the willing cooperation of those affected by it and meshes its goals with the personal goals of the workforce
What a professional needs to understand in supervising security officers, heading an executive protection team, staffing a security operations centre, serving as a facility security officer, performing architecture and design functions, or administering a global assets protection program?
one need to understand what motivates people and what demotivates them.
What can be recognized as one of the most cost‐effective assets protection tools
Behavioral theories can guide both content and delivery methods for security training and awareness, which has been recognized as one of the most cost‐effective assets protection tools
What is especially valuable and challenging in a global environment that includes a wide range of cultures, customs, and perspectives
Collaboration
What help to the manager to get more done through others
The bigger the bag of motivational tools, the more likely the manager will be able to understand employees’ needs and tailor rewards to better meet them. [This] enables managers to get more done through others
How generally insurance can be categories
Property and liability
Explain Peril
Peril has been defined as “the cause of a possible loss.” Typical insurable perils include fire, windstorm, explosion, burglary, negligence, collision, disability, and death
In analysing insurance coverage is to find out what losses are covered. How losses may be classified
Direct loss, such as the physical loss of or damage to the object concerned, Loss of use, such as the reduction of net income due to loss of use of the damaged or destroyed object, extra‐expense losses, such as the costs of defending a liability suit and paying judgment or hospital and medical expenses following a personal accident.
What is the difference between fidelity coverage and surety coverage
Crime insurance is written to protect the insured against loss by burglary, robbery, theft, forgery, embezzlement, and other dishonest acts. Two types of bonds may be used for protection: fidelity and surety. Fidelity coverage is written to protect the employer from the dishonesty of employees. Surety coverage is intended to guarantee the credit or performance of some obligation by an individual
What is essential to understand in order to ensure adequate protection from insurance provider in relation to crime coverage
It is essential to understand the meaning of each criminal term used by the insurance company in order to ensure that adequate protection is obtained
What should be exercised while selecting an insurance provider
As in any other business relationship, due diligence must be exercised when selecting an insurance provider
What does it mean by cost‐effectiveness
Cost‐effectiveness means producing good results for the money spent. To senior management, cost‐effectiveness is the primary factor in determining the size or existence of the asset protection program
What a security manager should do to maximize cost‐effectiveness
To maximize cost‐effectiveness, a security manager should do:
1‐ ensures that the operations are conducted in the lease expensive, but cost effective way,
2‐maintainthe lowest costs consistent with required operational results,
3‐ ensure that the amount of money spent generates the highest return
Why senior management will inevitably view all operations from a financial perspective
Because the department that plays a direct role in the generation of revenue is a profit centre
Which categories of expense that security professionals must consider when developing a budget
Salaries, operational expenses, and capital expenditures
What is the essential step in developing a department budget
Is to review the organization’s overall strategy and goals to determine how the security budgets fits in.
What return on investment measures
Return on investment (ROI) is a standard profitability ratio that measures how much net income the business earns for each dollar invested by its owners. Also called return on equity.
Why return on investment is used to gauge
To gauge management’s overall effectiveness in generating profits
How return on investment can be measured
ROI can be measured in time saved, improved efficiency, reduced manpower, reduced losses, lower liability or insurance payments, or greater customer satisfaction. It all translates into an improved bottom line over time
How security metrics can be described
Security metrics is described as the process of measuring an asset protection program’s costs and benefits as well as its successes and failures
The first step in good security planning is performing an analysis of the potential areas of loss, their probability, and their gravity or impact on the corporation. This data, along with what element provides the information needed to present a security budget to senior management
Security metrics
How security managers are better able to show the cost‐effectiveness of asset protection
Through the application of metrics
What data analysis may suggest
Data analysis may suggest whether specific security measures are effective at all
From which baseline all expense budgets are built
Typically, a sales forecast will project sales revenue for a quarter or a year. This forecast will then be the baseline from which all expense budgets are built
When expense budgets total more than the available funds, budget reviews are conducted. Reductions in budget are usually made by deleting what kind of expenditures
Typically personnel and operating expenses
What management strives to maintain
Management strives to maintain the margin between gross sales and expenses, even in the face of reduced sales
What is the strength by using survey method while collecting data?
It makes possible the efficient collection data on large numbers of individuals; allows precise comparisons to be made between the answers of respondents.
How the real value of cost‐effectiveness data gathering comes
By making periodic cumulative reports to senior management
In data collection process, when direct observation method can be used
Direct observation can be used in some less serious, nuisance‐level situations to discover unknown aspects of the problem
What is the primary security task while dealing with the incident
Reporting the incident and; must also be emphasized
What security managers do to validate information
Conduct experiments
Report forms provide data necessary for asset protection operations; they should be analysed immediately by whom
By a responsible supervisor
The use of specially designed incident reporting forms also fosters easy data collection. What could be the approach to using such form
Design a good report form; teach security staff how to use it; promptly collect data and conduct initial analysis; produce periodic management reports
Collecting information is a paramount importance to security management. When the less staff will resist reporting incidents
The easier it is to create security reports
The warranty for a new security system generally covers the first year of operation
A maintenance contract for each subsequent year costs approximately what percent of the original system cost? 13 percent of the original system cost
What can lead to savings
Periodic reassessment of security solutions
What is only way operating functions can justify continued funding
The only way an operating function can justify continued funding is to demonstrate that the real costs to the enterprise would be greater if the level of support for the activity were reduced
What is the strength by using documentary method while collecting data
Can provide in‐depth materials and data on large numbers of subjects; is often essential when a study is either wholly historical or has a historical dimension
What are the main methods used in social science research
Main methods used in social science research are:
1‐ fieldwork,
2‐ survey,
3‐documentary,
4‐ experiments.
Software aggregates the data for analysis. Analysis of aggregate data should lead the security manager to discover what?
Trends, success, failures, costs, losses, savings, recoveries, what works, and what does not work, along with a host of other information
Display of the aggregate data is just as important as the data itself. While presenting information to decision makers with limited time, what approach a security manager should undertake to convey key points quickly
Graphical display of data
As part of asset protection, how security can be best described
As part of asset protection, security is best described as the implementation of standards and principles that, when constantly applied, control
What a security manager should do to maximize cost‐effectiveness of the asset protection program
Ensure that the operations are conducted in the least expensive, but cost effective way maintain the lowest costs consistent with required operational results, ensure that the amount of money spent generates the highest return
What is the primary factor in determining the size or existence of the asset protection program by senior management
To senior management, cost‐effectiveness is the primary factor in determining the size or existence of the asset protection program
What is required by cost‐effectiveness in asset protection
Cost‐effectiveness in asset protection requires balancing expenditures against results and revising the plan as needed. It also requires critical judgment based on a complete understanding of the enterprise operations, a broad knowledge of state‐of‐the‐art security, and the recognition that some elements of the security program may take several years to implement
As an asset protection tool, what is the least expensive countermeasure one can employ?
Procedural controls
How cost reduction can be achieved in a security department
Each element of the operation must be carefully examined for cost‐effectiveness. Periodic reassessment of security solutions can lead to savings. Security departments can also examine whether it is more cost‐effective to use a proprietary security officer force or a contract force. Another consideration might be the cost‐effectiveness of maintenance contracts for security systems. An analysis of the maintenance history might reveal that the services would cost significantly less if paid for on a time and material basis
Preventing crime, closing investigations, and maintaining order are all legitimate and necessary objectives of an asset protection program, but only for the purpose of helping the enterprise achieve its basic goal. But what is the goal for commercial organizations?
Preventing crime, closing investigations, and maintaining order are all legitimate and necessary objectives of an asset protection program, but only for the purpose of helping the enterprise achieve its basic goal. The goal is to make and distribute products or render services so as to earn the planned profit
How metrics in corporate security can be gathered
Corporate security can collect metrics on investigations conducted, recoveries made, risk assessments conducted, travel briefings provided to staff, etc
How security manager better way can show the cost‐effectiveness of asset protection program
Through the application of metrics, security managers are better able to show the cost‐ effectiveness of asset protection
How security budget can be prepared
The first step in good security planning is performing an analysis of the potential areas of loss, their probability, and their gravity or impact on the corporation. This data, along with security metrics, provides the information needed to present a security budget to senior management
What are the causes of nuisance alarms
There were three factors: the age of some equipment, a lack of training and familiarity with the fire alarm system, and a lack of communication between staff and contractors working in the building
What is the difference between hard cost and soft cost in relation to nuisance alarm
Hard costs included lost productivity for employees evacuating the building and for employees responding to the alarms, as well as the cost of fire department fines. Soft costs included wear and tear on building mechanical systems when alarms activated; the tendency for employees to learn to ignore alarms, thereby placing themselves in jeopardy when legitimate alarms activate; the potential for staff injuries during evacuations; and the frustration of the organization’s staff and fire department personnel due to the high number of alarms.
Explain ROI
Return on investment (ROI) is a standard profitability ratio that measures how much net income the business earns for each dollar invested by its owners. Also called return on equity. The expectation is that security measures should not merely be efficient but should provide a positive return on investment
When an asset protection program would be cost‐justified
If an asset protection program was established that probable real losses would not occur if proposed asset protection measures were adopted.
What is paramount importance to security management
Collecting information
How real value of cost‐effectiveness data gathering comes
The real value of cost‐effectiveness data gathering comes in making periodic cumulative reports to senior management
What security managers should do to validate information collected from incident reporting forms?
To validate information, security managers can conduct experiments. One method is to gather statistics before and after implementation of a security measure to gauge whether it was effective. Another method is to implement the new security measure in one company site but not another and compare the results. Finally, direct observation can be used in some less serious, nuisance‐level situations to discover unknown aspects of the problem.
How the value of a physical asset can be calculated
The value of a physical asset can be calculated as the purchase price or acquisition cost, the depreciated book value (acquisition cost less accumulated depreciation), or replacement cost.
What two things an incident reposting system does
Provides a history of events occurring to the organization, provides a basis for professional efforts at asset recapture, recovery, or incident reduction or termination
What is needed for incident reporting to function
A statement of policy
What are the basic factors that an asset protection program is based
The criticality of company exposure and the probability of incidents
If database shows that a particular operation is suffering from fraud, what might be the issue?
Internal controls are inadequate
What are the bases of countermeasures
The selection of countermeasures also depends on the return on investment. Each countermeasure can be weighed against its likelihood of preventing losses, cost of implementation, potential recoveries made, and value of avoided losses
How the security manager can gain insights into countermeasures that may prevent future losses?
By tracking and analyzing incidents
Explain what do you understand by predictive modelling
The ultimate value of incident reporting lies in the opportunities it creates for avoiding future incidents, events, and losses through planning, employee awareness training and security enhancements. Therefore, the following categories of incidents should be tracked: Most vulnerable assets, such as those susceptible to high‐frequency losses, Time of loss occurrence, Locations in which losses occur, especially high‐frequency loss locations, Countermeasures that were useful or ineffective, Losses representing the highest costs, Types of incidents, Slips, falls, and other incidents that expose the organization to lawsuits, Health and safety violations resulting in lost time, reduced productivity, and increased workers’ compensation fees, Any incident type that costs the organization time, effort, or money.
What should be the policy on submission of incident reports
All employees must notify their immediate supervisors of any incidents or known or suspected asset losses. First‐line supervisors should be responsible for completing reports for losses within their areas of responsibility. The security manager is responsible for reviewing the report
What do you mean by “plot event trends
Plot event trends—by amounts, frequencies, types of assets, day/time of loss, prime incident locations, people involved, causes of occurrences, etc.
What provide basis for insurance claims or changes to self‐insurance reserves
Incident reporting provides a basis for insurance claims or changes to self‐insurance reserves
What can be the consequences if incidents are not reported to a central database
If incidents are not reported to a central database, they may be seen as a series of unique events when in reality they may be linked in some way and may be leading up to a major loss event
To analyze the current state of a business finance and project how financial decisions will affect the business, what is a necessity
Financial reports
How would a manager develop budgets and set expected goals for revenue of return on investment
From financial analysis
What would provide the asset protection professional with the analysis and decision making tools that will allow him monitor the financial operations of the security department and make better financial decisions
Financial management practices
To check whether a business can really pay its current bills is better measured by the
Quick ratio
An organization’s current assets that can quickly be converted to cash is known as
Acid test
An organization’s best resource for a realistic budget information is
Frontline managers
List what are measures for margin
Gross profit margin
Operating margin
Net profit margin
In recruiting, the requirements the job candidate must meet to understand and function in the job position being sort is
Direct requirements
The tool used to weigh which skills of a job candidate are most valuable for the job position is
Job requirement analysis
A management efforts to focus resources on specific targets that leads to business success through proper planning is
Strategy
An organization’s current and prospective financial health can clearly be painted through what
Income statement
Balance sheet
Statement of cash flow
If a company wishes to improve its margin which of these is an option
Reduce production cost/
Increase product and Service prices
Money a company receives for products or services provided is
Revenue
Security managers can determine whether the security practices and procedures accurately reflects the organizational strategy through what
Key metrics and performance indicators
The primary limitation of a financial statement is
It does not consider changes in market conditions
How is the cost of creating a product or service, accounting for materials and other labor cost classified
Cost of goods sold
State the equation of the balance sheet
Assets=liabilities + shareholders equity
A standard established and maintained by the international accounting standards board on which many countries are converged is called
International financial reporting standards (IFRS)
Financial statements are created in accordance with which of the following
GAAP
A management financial approach to determining the expected return of its investments is called
Financial strategy
Which information’s are provided in the balance sheet
Insight into the asset and liability mix and how they relate to shareholder equity
Insight into a company’s use of profit to increase equity
Views of the company’s operations, financing and investments
In creating a budget for a company, how should the budget be organized
To resemble the income statement equivalent of a pro-forma income statement which projects future cost and revenue for a defined period
What is considered cash equivalent on the balance sheet
Current assets
Which of the following is a Hybrid budget technique
Top-down, Bottom-up
What is one major reason why lower level managers are more likely to accept a bottom-up budgeting
Because they had a stake in developing it
A security manager can measure the effectiveness of a security countermeasure to show a long-range cost saving to the company’s senior management by applying what ration
Efficiency VS cost
A organization’s financial obligation is referred to as
Liabilities
What are the terms used to describe assets on the balance sheet
Prepaid accounts
Accounts receivable
Inventory
What are common terms used to describe liabilities on the balance sheet
Current long-term debts
Accounts payable
Interest payable
What in the balance sheet is neither an asset nor a liability
Shareholder’s equity
Anything that a company owns or has title to that, may provide a future economic benefit is referred to as
Assets
What are the main purposes of a budget
To provide fiscal uniformity for the company
To provide a financial tool that estimates costs and revenues
Provide variance warming
An organization calculates its return on investment by which of the following means
ROI= Investment value at end of period
Investment value at beginning of period - 1
ROI= (Initial Investment plus Interest Earned (or lost) - 1
Initial Investment
Shareholders equity is derived from what
Retained earnings
Net incomes
Dividends payouts
What is fiduciary
Holding in trust
A tool used by organization’s to aid in quantifying its ability to generate income beyond covering expenses is
Profitability ratio
By taking out an external financing a construction company can purchase more equipment and hire more people to address a greater demand for the company’s services, the company is practicing what
Leveraging
What outlines an organization’s profitability but not its overall financial health
Income statement
A company that wants to cover its operational cost and other business expenses for the reporting period, will use what on the balance sheet
Current assets
Retained earnings decrease if
If income is actually a net lose
If dividends are paid out
The purpose of GAAP is
Establish and maintain a standard for financial reporting that can across all organization
An organization can increase revenue, without increasing expense by
Profitability ratio
A view of a company’s operating, financing and investments and not where cash is being allocated is outlined in which statements
Balance sheet/Income statements
A specific entry in the budget that can be tracked to ensure that spending is within its predetermined limits is called
Line items
The difference between how much an organization generates and spends is referred to as
Net income
In task 43 above which financial report will provide the information on where cash is being allocated
Income statement
An organization generating enough cash to cover operations and acquire additional assets is demonstrated in which statements
Cash flow statements
Which of these concepts is a perfect fit for asset protection
Risk
A major area where the private security has problem is
Public/supplements
The desirability of different ways of spending an organization’s resources is calculated effectively by
Return on investment
In establishing a financial strategy the first step is
Identify expected margins
Placing funds in an organizations security operation only to the extent that planned security expenditures are justified in details and has an ROI is referred to as
Zero-based budgeting
A frame work for the creation of financial statements is called
Generally accepted accounting principles
The statement that provides an insight to what the company owes and owns in both short and long-term is
Balance sheet
Net profits and an indication of an organization profitability are detailed in the income statements, which of the followings is its shortcoming
It does not provide a clear picture of the extended liability of the organization
An organization’s ability to generate income on its assets independent of any financing is demonstrated in by
Return on assets
When are shareholders accountable for the extended liability of an enterprise
If its liabilities far outweighs its assets
An example of a positive cash equivalent on the balance sheet is
Accounts receivable
Amount of principal paid during the fiscal year by an organization is called
Current long-term debt
The preferable approach to budgeting is
Top down Bottom up
When executive management allocates specific amount of cash resources to the security department without input from the department. This budget approach is referred to as
Top-down
An organization’s current or projected numbers that are derived directly from financial decisions are dealt with by what process
Financial management system
An estimate of the probability that an investment will gain or lose money is
Risk
The cash flow statement shows what
Net operating cash flow
Net investing cash flow
Financing cash flow
A realistic budget determination, in line with overall financial objectives with inputs from front line managers is referred to as
Bottom-up
A risk ratio also known as the acid test is called
Quick ratio
The current state of a business can be deduced by What
Looking at products offered
Markets targeted
Financial results
The life-span of a budget
One Year
How can a company increase revenue without increasing total expense
By providing more services and allowing products sales to grow slowly
This demonstrates a company’s overall operating efficiency in producing and selling its products
Operating margin
The amount of money an investment choice will give back to an investor is
Return
When would spending beyond the budget be necessary
To take advantage of investment opportunities that arises
Complete the statement ‘‘budget the equivalent of pro forma income statement, which projects future cost and what else
Revenue for a defined period
Analyzing the current state of a business finances and projecting how decisions will affect the business can be made possible through what
Financial report
Business ethics can be applied on all the following levels except
Individual employees
The organization
Society
The core foundational values upon which business ethics rest are
Responsibility
Fairness
Compassion
The closest thing to a universal guideline for ethics is
Treat others the way one would want to be treated
What can form the basis by which employees conduct their business and make business decisions
A business code of conduct or ethic code
The first aspect of ethics is
The ability to discern right from wrong
Reasons that lead business people to make unethical choices includes what
Convenience
Winning
Relativism
The fundamental to establishing an environment wherein business can be conducted fairly and appropriately is
The application of business ethics
What will influence an individual employee in his ethical conduct
Business principles and executive behavior
What is another name for business ethics
Applied ethics
With enough effort, an individual can rationalize almost any act as right in a given situation. When convenience and winning are already the prime motivates making an unethical choice becomes easier and for some justifiable, logical option This philosophy is called
Relativism
Which form of ethics makes specific judgment about right and wrong and prescribes types of behavior as ethical in the context of the activity
Applied ethics
That there are no true ethical values that prescribe behavior is which ethics
Situation ethics
If the liability of an enterprise far outweighs its assets, who will be accountable for the extended liability
Shareholders
Revenue generated from primary business activities is called
Operating income
Business use comparative analysis to evaluate capital investment, which of these is not a method of analysis
Increased productivity
What are the types of budget
Line item
Capital budget
Program budget
What are considered current assets on the balance sheet
Account receivable
Prepaid accounts
Cash
The process where the number of goods being off loaded is not known to the offloading employee as a way of controlling theft is called
Blind tally
What does the formulae ALE express
Impact x Frequency
From what perspective will senior management inevitably view all organizational operations
Financial perspective
The goal of risk analysis is
The recognition of threats as they relate to the company operations
To gauge a management’s overall effectiveness in generating profit, a manager should use
Return on equity
A blue-print used for developing security objectives is
WAEC-UP model
How can an organization project its employees from customers who claims to incur losses and mental anguish resulting from intentional or negligent injury to them by employees
Liability endorsement
What is a factor to consider in planning for business interruption
Valuation
A condition of the insured personal habits that increases the probability of loss- which may be prohibitive is referred to as
Moral hazard
