Which of the following is NOT classified as a financial risk?

Regulatory compliance is not classified as a financial risk because it pertains to the legal obligations and regulations governing an entity's operations rather than the financial aspects of its performance. Financial risks typically involve uncertainties related to monetary transactions and market fluctuations.

Credit risk, for example, relates to the possibility that a borrower will default on their obligations, affecting the financial health of the lender. Liquidity risk refers to the risk that an entity will not be able to meet its short-term financial obligations due to an inability to convert assets into cash quickly. Equity price risk encompasses the potential losses associated with declines in the value of equity securities.

In contrast, regulatory compliance involves ensuring that an organization adheres to laws and regulations, which, while important for overall risk management, does not directly impact the financial valuation or performance. Thus, regulatory compliance is more focused on governance and operational integrity than on financial risk, making it the correct answer in this context.