单选题 Banking organizations are highly geared, much more than commercial or industrial companies. They have custody of large volume of monetary items, which makes them vulnerable to misappropriation and fraud. They therefore need to establish formal operating procedures, well defined limits for individual discretion rigorous system of internal control. Banking organizations engage in a large volume and variety of transactions. This necessarily requires complex accounting and internal control system and widespread use of electronic data processing. Banking organizations often assume significant commitments without any transfer of funds. These items may not involve accounting entries and consequently the failure to record such items may be difficult to detect. And most importantly, the failure of a bank, unlike most commercial firms, affects more than the fortunes of its shareholders and creditors, and may destabilize the whole economy.
Effective supervision of banking organizations is an essential component of a strong economic environment in that the banking system plays a central role in making payments and mobilizing and distributing savings. Strong and effective banking supervision provides a public good that may not be readily available in the marketplace. Along with effective macroeconomic policy, it is critical financial stability in any country. While the cost of banking supervision is indeed high, the cost of poor supervision has proved to be even higher.
For all these reasons, banks throughout the world are generally accorded a higher degree of official, supervision and regulation than other types of businesses. At the same time, banks are also provided with important elements of official protection. For example, the central bank usually acts as a lender of last resort to protect commercial banks against a temporary liquidity drain. This protection is an important component of the official safety net bank stopping the banking system. Another major aspect of that safety net takes the form of deposit insurance fund to guarantee bank depositors that they will get their money back in the event of a bank failure.

单选题 Why should banks need to establish formal operating procedures?
A. The supervisory authorities require them to do so.
B. The shareholders expect a reasonable return on their investment.
C. The banks have to keep safe large volume of monetary items raised from all sources.
D. The banks engage in a large volume and variety of transactions.

单选题 Which of the following requirements is NOT mentioned in successfully dealing with large volume and variety of transactions?
A. A large number of skillful staff and expertise.
B. Effective internal control system.
C. Complex accounting system.
D. Widespread use of electronic data processing.

单选题 "Vulnerable to" in Line 3 probably means ______.
A. subject to B. easy to be attacked by
C. of great volume D. likely to damage

单选题 A high degree of official supervision and regulation on bank organizations are important because ______.
A. The governments of many countries want to control banks
B. There are too many troubles in banking sector
C. It is crucial to stabilize the financial sector and the whole economy
D. The banks make much more deposit insurance fund

单选题 What is the main function of deposit insurance fund?
A. To ensure that the banks have sufficient fund to finance other economic sectors.
B. To protect the banks from all kinds of risks arising from their operation.
C. To meet requirements of financial needs of the public.
D. To pledge to depositors that their money is safe whenever a bank is insolvency.