Mastering Risk Management

INTRODUCTION

There are many ways to challenge a model that are non-mathematical. In reality, the mathematical challenge to a model is only one type of challenge and is very narrow. What goes into a model, the parameters around a model, what comes out of a model and the documentation and governance are all as important as the mathematics. And yet, mathematics appears to be the be all and end all of so many articles on modelling. This chapter will look at various ways to challenge a model that are grounded in a business approach to modelling (with not a differential equation in sight!).