Which item is a financial risk under Agency CM?

Which item is a financial risk under Agency CM?

• A. Working at night
• B. Theft
• C. Lengthy Schedule
• D. Cost underruns

Answer: (B)

In Agency CM, financial risk is about threats to money or assets that the owner entrusts to the project, which the construction manager must guard against through controls and accountability. Theft directly jeopardizes those funds and materials, creating an immediate financial loss and potentially undermining the project budget. From a risk perspective, this is the quintessential financial risk because it involves misappropriation of resources the owner expects to be protected. Working at night is primarily a safety and security concern, which can drive costs or create hazards but isn’t a core financial risk in the sense of loss of funds. A lengthy schedule is a schedule risk—its main impact is延期 risk and associated costs over time rather than a direct financial loss of assets. Cost underruns describe spending less than planned, which is not a risk to the financial resources in the same way as theft; it’s typically a favorable outcome, though it can signal other issues if it stems from shortcuts or quality problems.

In Agency CM, financial risk is about threats to money or assets that the owner entrusts to the project, which the construction manager must guard against through controls and accountability. Theft directly jeopardizes those funds and materials, creating an immediate financial loss and potentially undermining the project budget. From a risk perspective, this is the quintessential financial risk because it involves misappropriation of resources the owner expects to be protected.

Working at night is primarily a safety and security concern, which can drive costs or create hazards but isn’t a core financial risk in the sense of loss of funds. A lengthy schedule is a schedule risk—its main impact is延期 risk and associated costs over time rather than a direct financial loss of assets. Cost underruns describe spending less than planned, which is not a risk to the financial resources in the same way as theft; it’s typically a favorable outcome, though it can signal other issues if it stems from shortcuts or quality problems.