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2. The Lusaka Prime Cooperative is a member based organization and ownership is by way of shares. Funds collected from members are invested in any assets and sold on credit to members. The organization is required by law to reserve 25% of profits to a capital reserve. 20% of the capital reserve is meant for training of the committee and members. The governing committee has purchased land amounting to K 2 million which is about 30 % of capital contributed. The committee made contact with an uncle residing in the village where the land is situated K 80,000.00 was spent on training while K 118, 000 was reflected in financial statements as the transfer to reserves. Funds have been lent out amounting to K 3.5 million. The organization made profits amounting to K 500,000.00 A. You are required to point out and describe FIVE (5) key potential losses and justify with reasons how insurance products can help mitigate those losses. 5 marks B. What FIVE (5) controls would you expect the insurance company to verify before accepting insurance program from this organization relating to transactions involving; a. Ownership stake b. Financial reporting (based on data disclosed in the question above) c. Lending activities d. Procurement e. Governance 10 marks C. Describe how this organization can protect its members from suffering financial losses that may arise from inept management 5 marks D. You have been appointed as the Risk Manager and having analyzed the data above, you are required to outline and describe Five (5) irregularities from the data given above. 5 marks E. Describe FIVE (5) reasons why some losses faced by this organization may not be accepted by underwriters. 2. The Lusaka Prime Cooperative is a member based organization and ownership is by way of shares. Funds collected from members are invested in any assets and sold on credit to members. The organization is required by law to reserve 25% of profits to a capital reserve. 20% of the capital reserve is meant for training of the committee and members. The governing committee has purchased land amounting to K 2 million which is about 30 % of capital contributed. The committee made contact with an uncle residing in the village where the land is situated K 80,000.00 was spent on training while K 118, 000 was reflected in financial statements as the transfer to reserves. Funds have been lent out amounting to K 3.5 million. The organization made profits amounting to K 500,000.00 A. You are required to point out and describe FIVE (5) key potential losses and justify with reasons how insurance products can help mitigate those losses. 5 marks B. What FIVE (5) controls would you expect the insurance company to verify before accepting insurance program from this organization relating to transactions involving; a. Ownership stake b. Financial reporting (based on data disclosed in the question above) c. Lending activities d. Procurement e. Governance 10 marks C. Describe how this organization can protect its members from suffering financial losses that may arise from inept management 5 marks D. You have been appointed as the Risk Manager and having analyzed the data above, you are required to outline and describe Five (5) irregularities from the data given above. 5 marks E. Describe FIVE (5) reasons why some losses faced by this organization may not be accepted by underwriters

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