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OM-4.1.1

Although operations risks are difficult to quantify, they can often be evaluated by examining a series of "worst-case" or "what-if" scenarios (stress testing), such as a power loss, a doubling of transaction volume or a mistake found in the pricing software for collateral management. They can also be assessed through periodic reviews of procedures, documentation requirements, data processing systems, contingency plans and other operational practices. Such reviews may help to reduce the likelihood of errors and breakdowns in controls, improve the control of risk and the effectiveness of the limit system and prevent unsound marketing practices and the premature adoption of new products or lines of business.