Design, Calibration & Reporting of Effective Key Risk Indicators

By Eamonn Phelan, Fred Vosvenieks, Cormac Gleeson, Eóin Stack and Gavin Maher · Milliman · 2020 · CFE101-124-26

Study guide: Exam CFE-101

A Milliman briefing note, dated November 2020, on approaches to developing a robust suite of Key Risk Indicators (KRIs) and the wider considerations for risk reporting. It treats a KRI as an early warning indicator that a company's risk profile may deviate from its risk tolerance or risk limits in the future, to be designed on what is most useful and meaningful rather than on what is easily monitored.

On the syllabus

• Exam CFE-101 — CFE101-124-26: Design, Calibration & Reporting of Effective Key Risk Indicators; outcomes 1.3a, 2.1c, 2.2h.

KRI Design

• Understanding the risks

KRI Calibration

• Data sources
• Individual risk levels
• Risk aggregation calibration
• Recalibration of KRIs
• Emerging risk KRIs

KRI Reporting

• Risk dashboard
• "Everyday" risk reporting
• Action plan reporting

Conclusion

How can Milliman help?

Sources

• Design, Calibration & Reporting of Effective Key Risk Indicators (Milliman briefing note, November 2020) — the document: title, authors, opening summary for the lead, and its section and sub-section headings
• CFE 101 Syllabus, Nov 2026/Mar 2027/Jul 2027 (SOA) — the reading code, its title in the SOA's wording and the learning outcomes