Certified Regulatory Compliance Manager (CRCM) — Question 280

Which of the following actions is acceptable under the financial reporting regulations?

Answer options

• A. Attaching a narrative explanation by management of the reasons for a cease and desist order as a part of the annual disclosure
• B. Attaching a copy of the bank's last safety and soundness examination to the annual disclosure
• C. Including a statement that indicates that the bank's regulatory agency has reviewed the financial information
• D. Using an unaudited financial statement for the past two years as an annual disclosure statement

Correct answer: A

Explanation

The correct answer is A because providing a narrative explanation for a cease and desist order is permissible and adds transparency to the annual disclosure. Options B and C may not be allowed as they could violate confidentiality or regulatory guidelines, while option D is incorrect since using unaudited financial statements does not meet the standards required for annual disclosures.