During an AI system audit, an auditor discovers that the organization lacks a formal model inventory. What is the MOST significant risk associated with the absence of a model inventory?
Select an answer to reveal the explanation.
Short Explanation and Infographic
Here's the deal — b is correct because a model inventory is the foundational control for model risk management; without it, organizations cannot systematically track model status, risk tier, ownership, validation dates, or performance, leaving models in production without oversight. This is explicitly required by SR 11-7 and OCC guidance.
Full explanation below image
Full Explanation
B is correct because a model inventory is the foundational control for model risk management; without it, organizations cannot systematically track model status, risk tier, ownership, validation dates, or performance, leaving models in production without oversight. This is explicitly required by SR 11-7 and OCC guidance. Training cost tracking (A) is an operational concern, not a risk. GDPR (C) and ISO 9001 (D) do not specifically require model inventories.