Liquidity risk is the risk that CI may not be able to generate sufficient funds and within the time required in order to meet  its obligations as they come due. While CI currently has access to financing, unfavourable market conditions may affect  the ability of CI to obtain loans or make other arrangements on terms acceptable to CI. Strategic risks are risks that directly impact the overall direction of CI and the ability of CI to successfully implement  proposed strategies. The key strategic risk is the risk that management fails to anticipate, and respond to changes in the  business environment including demographic and competitive changes. CI’s performance is directly affected by fi nancial  market and business conditions, including the legislation and policies of the governments and regulatory authorities having  jurisdiction over CI’s operations. These are beyond the control of CI; however, an important part of the risk management  process is the on-going review and assessment of industry and economic trends and changes. Strategies are then designed  to mitigate the impact of any anticipated changes, including the introduction of new products and cost control strategies. CI distributes its investment products through a number of distribution channels including brokers, independent fi nancial  planners and insurance advisors. CI’s access to these distribution channels is impacted by the strength of the relationship  with certain business partners and the level of competition faced from the financial institutions that own those channels.  While CI continues to develop and enhance existing relationships, there can be no assurance that CI will continue to enjoy  the level of access that it has in the past, which would adversely affect its sales of investment products.  Operational risks are risks related to the actions, or failure in the processes, that support the business including  administration, information technology, product development and marketing. The administrative services provided by CI  depend on software supplied by third-party suppliers. Failure of a key supplier, the loss of these suppliers’ products, or  problems or errors related to such products would have a material adverse effect on the ability of CI to provide these  administrative services. Changes to the pricing arrangement with such third-party suppliers because of upgrades or other  circumstances could have an adverse effect upon the profitability of CI. There can be no assurances that CI’s systems  will operate or that CI will be able to prevent an extended systems failure in the event of a subsystem component or  software failure or in the event of an earthquake, fire or any other natural disaster, or a power or telecommunications  failure. Any systems failure that causes interruptions in the operations of CI could have a material adverse effect on its  business, financial condition and operating results. CI may also experience losses in connection with employee errors.  Although expenses incurred by CI in connection with employee errors have not been signifi cant in the past, there can be  no assurances that these expenses will not increase in the future. CI is subject to various uncertainties concerning the interpretation and application of Canadian tax laws. If tax authorities  disagree with CI’s application of such tax laws, CI’s profitability and cash flows could be adversely affected. CI Investments  is considered a large case file by the Canada Revenue Agency, and as such, is subject to audit each year. There is a  significant lag between the end of a fiscal year and when such audits are completed. Therefore, at any given time, several  years may be open for audit and/or adjustment. 41 TAXATION RISK OPERATIONAL RISKS DISTRIBUTION RISK STRATEGIC RISKS  LIQUIDITY RISK