(a) Elements of a Risk Management System:
The essential elements of a risk management system include:

1. Risk Identification: Recognizing potential risks that could affect the organization.
2. Risk Assessment: Evaluating the potential impact and likelihood of identified risks.
3. Risk Control: Implementing strategies to mitigate or manage risks.
4. Monitoring and Reporting: Continuously reviewing the effectiveness of risk management strategies and providing reports to relevant stakeholders.
5. Internal Controls: Establishing measures that ensure proper governance and mitigate risks in daily operations.
6. Risk Response Plans: Developing action plans to respond to risks that arise.
7. Risk Culture: Creating awareness of risk management throughout the organization, ensuring everyone understands and contributes to managing risks.
8. Compliance: Ensuring that the organization adheres to legal and regulatory requirements regarding risk.

(b)
(i) Functions of the Board Committee in Relation to Enterprise Risk Management (ERM):
The Board Committee responsible for risk management typically performs the following functions:

1. Risk Policy Development: Formulating policies and frameworks for managing risks across the organization.
2. Risk Appetite Setting: Defining the level of risk the organization is willing to accept in pursuit of its objectives.
3. Oversight of Risk Identification and Assessment: Reviewing the process of identifying and assessing significant risks.
4. Monitoring Risk Mitigation: Ensuring that effective controls and measures are in place to mitigate risks.
5. Reporting and Accountability: Ensuring proper reporting of risk exposures to the Board and relevant stakeholders, including shareholders.
6. Reviewing Risk Management Systems: Periodically reviewing the effectiveness of the risk management processes and recommending improvements.

(ii) Turnbull Report – Six Categories of Risk Common to Business:
The Turnbull Report identifies six key categories of risk that are common to most businesses:

1. Strategic Risk: Risks related to the overall direction and strategic decisions of the company.
2. Operational Risk: Risks that arise from internal processes, systems, and people involved in the day-to-day operations of the business.
3. Financial Risk: Risks associated with financial transactions, market volatility, liquidity, and credit.
4. Compliance Risk: Risks related to legal and regulatory requirements.
5. Reputational Risk: Risks that could affect the company’s public image and stakeholder trust.
6. Environmental Risk: Risks arising from environmental factors, including natural disasters and sustainability issues.