Acams Exam Advanced-CAMS-Audit Topic 4 Question 15 Discussion

Actual exam question for Acams's Advanced-CAMS-Audit exam

Question #: 15
Topic #: 4

Following completion of testing and tuning of the parameters and thresholds of the transaction monitoring model which final step should the team recommend as necessary to verify effective model functioning?

AModel validation

BAudit continuous monitoring

CData validation

DRegulatory approvals
Purpose of Model Validation:
Model validation ensures that the transaction monitoring model is functioning as intended, effectively identifying suspicious transactions and mitigating AML/CFT risks.
It encompasses testing data accuracy, parameter relevance, threshold efficacy, and compliance with regulatory requirements.
Process:
Validation includes end-to-end reviews, statistical evaluations, and expert assessments of model outputs.
According to FATF and Basel Committee standards, model validation is a critical component of the AML framework.
Irrelevance of Other Options:
Audit continuous monitoring focuses on ongoing oversight, not the specific confirmation of initial model functionality.
Data validation addresses data quality but does not verify operational model performance.
Regulatory approvals are necessary for compliance but are not a step in verifying model functioning.

Show Suggested Answer

Suggested Answer: A

by Kristine at Jul 04, 2025, 07:21 AM

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Leonard

10 days ago

Exactly, model validation is specifically for confirming the model's effectiveness in identifying suspicious transactions.

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Theola

16 days ago

Audit continuous monitoring is for ongoing oversight, not for verifying initial model functionality.

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Jade

19 days ago

I'm with Francine and Clarence on this one. Model validation is the way to go. Gotta make sure that AML model is firing on all cylinders, you know?

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1 months ago

I think option A, Model Validation, is the correct answer. It's the only one that specifically focuses on verifying the model's effectiveness and compliance with regulations.

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Chuck

23 days ago

User 3: Model validation also helps in mitigating AML/CFT risks, which is essential for compliance with regulations.

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Denny

29 days ago

User 2: Definitely, it's important to confirm that the parameters and thresholds are effective in identifying suspicious transactions.

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Daniel

1 months ago

User 1: I agree, model validation is crucial for ensuring the transaction monitoring model is working as intended.

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