Isaca CRISC Certified in Risk and Information Systems Control Exam Practice Test

 Establishing clear accountability for risk is the best way for an organization to enable risk treatment decisions, as it ensures that the risk owners and stakeholders have the authority and responsibility to manage and mitigate the risks that they are assigned to. Establishing clear accountability for risk also facilitates communication and collaboration among the risk owners and stakeholders, and enables them to monitor and report the risk status and performance. Establishing clear accountability for risk also supports the risk governance and culture of the organization, and aligns the risk management process with the organization’s strategy and objectives. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 250. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 250. CRISC Sample Questions 2024, Question 250. CRISC by Isaca Actual Free Exam Q&As, Question 9.

An effective risk management program is a systematic and consistent process of identifying, analyzing, evaluating, treating, monitoring, and communicating risks that may affect the achievement of the organization’s objectives12.

The best indication of an effective risk management program is that the residual risk, which is the risk remaining after risk treatment, is within the organizational risk appetite, which is the amount and type of risk that the organization is willing to accept in pursuit of its objectives12.

This indicates that the organization has successfully implemented appropriate risk responses that align with its risk strategy and criteria, and that the organization is able to balance the potential benefits and costs of taking risks12.

The other options are not the best indication, but rather components or outcomes of an effective risk management program. For example:

Risk action plans are approved by senior management is an outcome of an effective risk management program that demonstrates the commitment and accountability of the leadership for risk management12.

Mitigating controls are designed and implemented is a component of an effective risk management program that involves reducing the likelihood or impact of a risk event12.

Risk is recorded and tracked in the risk register is a component of an effective risk management program that involves documenting and updating the risk information and status12. References =

1: Risk IT Framework, ISACA, 2009

2: IT Risk Management Framework, University of Toronto, 2017

Several network user accounts were recently created without the required management approvals. This indicates that there is a risk of unauthorized access, use, disclosure, modification, or destruction of the network resources or data, which may affect the confidentiality, integrity, and availability of the network.

The best recommendation to address this situation is to investigate the root cause of noncompliance. This means that the risk practitioner should analyze the factors or reasons that led to the creation of the network user accounts without the required management approvals, such as human error, negligence, malice, system failure, process flaw, etc.

Investigating the root cause of noncompliance helps to identify and correct the source of the problem, prevent or reduce the recurrence of the problem, and improve the compliance and security of the network user accounts.

The other options are not the best recommendations to address this situation. They are either secondary or not effective for noncompliance.

The references for this answer are:

Risk IT Framework, page 31

Information Technology & Security, page 25

Risk Scenarios Starter Pack, page 23

 A risk portfolio is a collection of risks that an organization faces or may face in the future. Analyzing trends in key control indicators (KCIs) best enables a risk practitioner to proactively identify impacts on an organization’s risk portfolio, as KCIs measure and monitor the performance and effectiveness of the risk controls that are implemented to mitigate the risks. By analyzing the trends in KCIs, a risk practitioner can assess the current and potential risk exposure of the organization, and identify any changes or emerging risks that may affect the risk portfolio. Analyzing trends in KCIs can also help to evaluate the cost and benefit of the risk controls, and to determine the need for enhancing, modifying, or implementing new controls. References = CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 246. Most Asked CRISC Exam Questions and Answers, Question 10. ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 246. CRISC by Isaca Actual Free Exam Q&As, Question 9.

According to the ISACA Risk and Information Systems Control study guide and handbook, the most comprehensive approach to capture the risk scenario of collecting and storing credit card information is event tree analysis (ETA). ETA is a forward, top-down, logical modeling technique that explores the responses and outcomes of a single initiating event, such as a data breach or a cyberattack. ETA can help to identify all possible consequences of the scenario, such as financial losses, reputational damages, legal liabilities, regulatory penalties, and customer dissatisfaction. ETA can also help to assess the probabilities of the outcomes and the effectiveness of the controls and mitigation strategies12

1: ISACA Risk and Information Systems Control Study Guide, 4th Edition, page 33 2: ISACA Risk and Information Systems Control Handbook, 1st Edition, page 25

A critical patch is a software update that fixes a security vulnerability or a bug that may affect the performance, functionality, or reliability of a system or a network. A critical patch implementation is a process that applies the software update to the system or network in a timely and effective manner. The failure of a critical patch implementation is a situation where the software update is not applied or not applied correctly, which may expose the system or networkto various threats, such as data theft, data corruption, data leakage, or denial of service. The failure of a critical patch implementation would be reflected in an organization’s risk profile by increasing the residual risk. Residual risk is the risk that remains after the risk response, which means the risk that is not avoided, transferred, or mitigated by the existing controls or measures. The failure of a critical patch implementation would increase the residual risk, as it would reduce the effectiveness or efficiency of the existing controls or measures that are supposed to address the security vulnerability or the bug. The failure of a critical patch implementation would also increase the likelihood or impact of the potential threats, as well as the exposure or consequences of the system or network. The other options are not the correct changes that would be reflected in an organization’s risk profile after the failure of a critical patch implementation, although they may be affected or related. Risk tolerance is the degree of variation from the risk appetite that the organization is not willing to accept. Risk tolerance may be decreased by the failure of a critical patch implementation, as the organization may become more cautious or conservative in accepting the risk, but it is not a direct or immediate change in the risk profile. Inherent risk is the risk that exists in the absence of any controls or measures, which means the risk that is inherent to the system or network or the environment. Inherent risk may be increased by the failure of a critical patch implementation, as the system or network may become more vulnerable or susceptible to the threats, but it is not a change in the risk profile, as the risk profile considers the existing controls or measures. Risk appetite is the amount and type of risk that the organization is willing to accept in pursuit of its objectives. Risk appetite may be decreasedby the failure of a critical patch implementation, as the organization may become less willing orable to accept the risk, but it is not a change in the risk profile, as the risk profile reflects the actual or current risk level, not the desired or expected risk level. References = CRISC Review Manual, pages 32-331; CRISC Review Questions, Answers & Explanations Manual, page 972; What is a Critical Patch? - Definition from Techopedia3; What is Residual Risk? - Definition from Techopedia4

A risk awareness program is a set of activities and communication methods that aim to increase the understanding and knowledge of risk among the stakeholders of an organization. The primary objective of a risk awareness program is to enhance the organizational risk culture, which is the shared values, beliefs, and attitudes that influence how risk is perceived and managed in the organization. A risk awareness program can help to promote a risk-aware culture by:

•Educating stakeholders on the concepts and benefits of risk management

•Aligning risk management with the organization’s vision, mission, and objectives

•Encouraging stakeholder participation and collaboration in risk management processes

•Fostering a positive attitude towards risk taking and learning from failures

•Reinforcing risk management roles and responsibilities

•Recognizing and rewarding good risk management practices

 The control environment is the set of standards, processes, and structures that provide the basis for carrying out internal control across the organization. The control environment is most effective when the controls perform as intended, meaning that they achieve their objectives, mitigate the risks, and comply with the policies and regulations. The other options are desirable attributes of the controls, but they do not necessarily indicate the effectiveness of the control environment. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.3: IT Control Assessment, page 69.

A heat map is a graphical representation of the organization’s risk profile that shows the relative level of risk for each risk category or event. A heat map uses colors, shapes, or symbols to indicate the magnitude and likelihood of each risk, as well as its trend and status. A heat map offers the simplest overview of changes in the organization’s risk profile, as it allows the risk decision-makers to quickly identify the most significant risks, theareas of improvement or deterioration, and the gaps or overlaps in risk management. A heat map can also be used to communicate the risk profile to senior management and other stakeholders in a clear and concise manner. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.3: IT Risk Assessment Methods and Techniques, Page 77; Future Risks: How organizations see changes in risk management - Aon.

Inherent risk is the most likely to increase as a result of the new initiative, because it is the risk that exists before any controls or mitigating factors are applied. Inherent risk reflects the natural or raw level of exposure that the organization faces from a given risk source or scenario. Accepting credit card payments from customers via the corporate website introduces new sources and types of risk, such as fraud, theft, data breach, or non-compliance, that increase the inherent risk level of the organization. Risk tolerance, risk appetite, and residual risk are all related to the risk management process, but they are not the most likely to increase as a result of the new initiative, as they depend on the organization’s risk strategy, objectives, and controls. References = Risk and Information Systems Control Study Manual, Chapter 2, Section 2.3.1, page 51

 A compensating control is a temporary or alternative control that is implemented when the primary control for mitigating a risk is not feasible or available. A compensating control should provide a similar level of protection and assurance as the primary control, and should be aligned with the risk appetite and tolerance of the organization. The risk practitioner’s best course of action when a compensating control needs to be applied is to obtain the risk owner’s approval. The risk owner is the person who has the authority and accountability for managing a specific risk, and who is responsible for ensuring that the risk is within the acceptable level. The risk practitioner should consult with the risk owner to explain the situation, proposethe compensating control, and seek their approval before implementing it. This way, the risk practitioner can ensure that the compensating control is appropriate, effective, and acceptable for the risk owner, and that the risk owner is aware of and agrees with the change in the risk treatment. The other options are not the best course of action, as they do not involve the risk owner’s approval or input. Recording the risk as accepted in the risk register implies that the risk is not treated or reduced, which may not be the case with a compensating control. Informing senior management may be a good practice, but it does not ensure that the risk owner is involved or agrees with the compensating control. Updating the risk response plan may be a necessary step after implementing the compensating control, but it does not require the risk owner’s approval or consultation. References = 5 Key Risk Mitigation Strategies (With Examples), Risk Management 101: Process, Examples, Strategies

Key control indicators (KCIs) are metrics that measure the performance of a control in reducing the causes, consequences, or likelihood of a risk. They help to evaluate the adequacy and efficiency of the internal control environment, which is the set of policies, procedures, and practices that support the achievement of organizational objectives and the management of risks. By monitoring KCIs, organizations can identify and address any gaps or weaknesses in their internal controls and ensure that they are operating as intended.

References

•ISACA CRISC Review Manual, 7th Edition, Domain 3: Risk Response, Section 3.2.2: Control Design and Implementation

•KRI Framework for Operational Risk Management | Workiva

•What is the difference between key risk indicators and key control indicators?

When determining an appropriate risk assessment approach, the most important factor to understand is the value of information assets. This is because the value of information assets determines the potential impact of risks and the level of protection required. The value of information assets can be assessed based on their confidentiality, integrity, availability, and relevance to the business objectives and processes. A risk assessment approach should be aligned with the value of information assets and the risk appetite of the organization. The other options are not the most important factors to understand when determining a risk assessment approach, although they may influence the choice of methods and tools. The complexity of the IT infrastructure may affect the scope and depth of the risk assessment, but it does not indicate the level of risk or the priority of risk management. The management culture may affect the risk tolerance and the risk communication, but it does not reflect the value of information assets or the risk exposure. The threats and vulnerabilities may affect the likelihood and severity of risks, but they do not measure the value of information assets or the risk acceptance. References = CRISC Review Manual, pages 38-391; CRISC Review Questions, Answers & Explanations Manual, page 582

Mitigating technology risk to acceptable levels means that the organization implements and maintains appropriate controls to reduce the likelihood and impact of potential threats or losses that may arise from the use of technology, such as IT systems, applications, networks, devices, etc.

The primary factor that should guide the mitigation of technology risk is the organizational risk appetite. This means that the organization defines and communicates the amount and type of risk that it is willing to accept or pursue in order to achieve its objectives and strategy.

The organizational risk appetite helps to determine the risk tolerance and thresholds for different risk categories and scenarios, prioritize the risks, select the most suitable risk responses, allocate the resources and budget for risk management, and monitor and report the risk performance and outcomes.

The other options are not the primary factors that should guide the mitigation of technology risk. They are either secondary or not essential for risk management.

The references for this answer are:

Risk IT Framework, page 25

Information Technology & Security, page 19

Risk Scenarios Starter Pack, page 17

Security awareness training is a process of educating and informing the users about the security policies, procedures, and best practices of the organization, and the potential threats and risks that may affect the confidentiality, integrity, and availability of the information and systems.

The best indicator of whether security awareness training is effective is user behavior after training. This means that the users demonstrate and apply the knowledge and skills that they have learned from the training, such as following the security rules and guidelines, reporting any security incidents or issues, avoiding any risky or malicious actions, etc.

User behavior after training helps to measure the actual impact and outcome of the training, compare them with the expected or desired objectives and standards, identify any gaps or issuesthat may affect the training effectiveness or efficiency, and take appropriate actions to address them.

The other options are not the best indicators of whether security awareness training is effective. They are either subjective or not essential for security awareness training.

The references for this answer are:

Risk IT Framework, page 30

Information Technology & Security, page 24

Risk Scenarios Starter Pack, page 22

The migration to a jurisdiction with heavy fines for data leakage primarily affects the potential impact of a risk event. This change should be reflected in the risk impact factor, as the financial consequences of a risk event would be significantly higher.

The first step for the risk practitioner to address the situation of extended network outages that have exceeded tolerance is to recommend a root cause analysis of the incidents. A root cause analysis is a process of identifying and resolving the underlying causes of a problem or an event. By performing a root cause analysis, the risk practitioner can determine why the network outages occurred, what factors contributed to them, and how they can be prevented or reduced in the future. Recommending additional controls, updating the risk tolerance level, and updating the incident-related risk trend are possible steps that may follow the root cause analysis, but they are not the first step. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 4; CRISC Review Manual, 6th Edition, page 153.

A strong risk-aware culture is reflected by transparent communication about risks. Open discussions signify employee engagement and ownership of risk-related issues.

When selecting a risk mitigation option, management should consider the cost of control implementation, as well as the benefits and residual risks. The cost of control implementation includes the direct costs of acquiring, installing, and maintaining the control, as well as the indirect costs of potential side effects, suchas reduced performance, increased complexity, or decreased user satisfaction. The cost of control implementation should be balanced with theexpected reduction in risk exposure and the alignment with the enterprise’s risk appetite and tolerance. The maturity of the enterprise architecture, the reliability of key performance indicators (KPIs), and the reliability of key risk indicators (KRIs) are relevant factors for risk identification and assessment, but not for risk response selection. References = Risk and Information Systems Control Study Manual, Chapter 4: Risk Response, page 149.

The person who should be accountable for resolving the situation where a root cause analysis indicates a major service disruption due to a lack of competency of newly hired IT system administrators is the chief information officer (CIO). The CIO is the senior executive who is responsible for the overall management and governance of the IT function within the organization, including the IT strategy, objectives, policies, processes, and resources. The CIO is also accountable for the performance and value of the IT services and systems, and for ensuring that they meet the needs and expectations of the business and its stakeholders. The CIO should be accountable for resolving the situation, because it involves a major IT service disruption that could affect the organization’s operations and reputation, and because it is related to the IT staff competency and capability, which are under the CIO’s authority and responsibility. The other options are not as accountable as the CIO, although they may have some roles or involvement inthe situation. The HR training director, the business process owner, and the HR recruitment manager are not directly responsible for the IT function or the IT service delivery, and they may not have the authority or the expertise to resolve the situation. References = Risk and Information Systems Control Study Manual, Chapter 2, Section 2.1.1, page 2-3.

When likelihood is unknown, range-based estimates from subject-matter experts provideinformed and realistic insights into potential risk exposure. This approach helps approximate the inherent risk based on experience and expertise, supporting effective decision-making.

A recovery time objective (RTO) is the maximum acceptable time or duration that a business process or function can be disrupted or unavailable due to a disaster or incident, before it causes unacceptable or intolerable consequences for the organization. It is usually expressed in hours, days, or weeks, and it is aligned with the organization’s business continuity and disaster recovery objectives and requirements.

The primary factor in determining a RTO is the cost of downtime due to a disaster, which is the estimated loss or damage that the organization may suffer if a business process or function is disrupted or unavailable for a certain period of time. The cost of downtime can be expressed in terms of financial, operational, reputational, or legal consequences, and it can help the organization to assess the impact and urgency of the disaster, and to decide on the appropriate recovery strategy and resources.

The other options are not the primary factors in determining a RTO, because they do not address the fundamental question of how long the organization can tolerate the disruption or unavailability of a business process or function.

The cost of offsite backup premises is the cost of acquiring, maintaining, or using an alternative or secondary location or facility that can be used to resume or continue the business process or function in case of a disaster or incident. The cost of offsite backup premises is important to consider when selecting or implementing a recovery strategy, but it is not the primary factor in determining a RTO, because it does not indicate the impact or urgency of the disaster, and it may not reflect the organization’s business continuity and disaster recovery objectives and requirements.

The cost of testing the business continuity plan is the cost of conducting, evaluating, or improving the tests or exercises that are performed to verify or validate the effectiveness and efficiency of the business continuity plan, which is the document that describes the actions and procedures that the organization will take to recover or restore the business process or function in case of a disaster or incident. The cost of testing the business continuity plan is important to consider when developing or updating the business continuity plan, but it is not the primary factor in determining a RTO, because it does not indicate the impact or urgency of the disaster, and it may not reflect the organization’s business continuity and disaster recovery objectives and requirements.

The response time of the emergency action plan is the time or duration that it takes for the organization to initiate or execute the emergency action plan, which is the document that describes the immediate actions and procedures that the organization will take to protect the life, health, and safety of the people, and to minimize the damage or loss of the assets,in case of adisaster or incident. The response time of the emergency action plan is important to consider when preparing or reviewing the emergency action plan, but it is not the primary factor in determining a RTO, because it does not indicate the impact or urgency of the disaster, and it may not reflect the organization’s business continuity and disaster recovery objectives and requirements. References =

ISACA, CRISC Review Manual, 7th Edition, 2022, pp. 62-63, 66-67, 70-71, 74-75, 78-79

ISACA, CRISC Review Questions, Answers & Explanations Database, 2022, QID 165

CRISC Practice Quiz and Exam Prep

Multi-factor authentication is the most effective way to mitigate the risk of unauthorized access to the system, as it requires the users to provide more than one piece of evidence to prove their identity, such as a password, a token, a biometric feature, etc. This reduces the likelihood of compromising the credentials and ensures that only authorized users can perform maintenance on the system.

Single sign-on is a convenience feature that allows users to access multiple systems with one set of credentials, but it does not address the risk of sharing credentials among multiple users.

Audit trail review is a detective control that can help identify and investigate unauthorized access to the system, but it does not prevent or mitigate the risk of credential compromise.

Data encryption at rest is a security measure that protects the data stored on the system from unauthorized access, but it does not prevent or mitigate the risk of credential compromise. References = CRISC Review Manual, 7th Edition, ISACA, 2020, page 107-108.

The likelihood rating in the risk register is a measure of how probable it is that a risk event will occur, given the current conditions and controls. The risk practitioner should change the likelihood rating if there is a significant change in the effectiveness of the controls that are implemented to prevent or reduce the risk. For example, if a control becomes obsolete, ineffective, or bypassed, the likelihood rating should increase, as the risk event becomes more likely to happen. Conversely, if a control becomes more efficient, reliable, or robust, the likelihood rating should decrease, as the risk event becomes less likely to happen. The other options are not likely to cause a change in the likelihood rating, as they are not directly related to the probability of the risk event. Risk appetite is the amount of risk that an organization is willing to accept in pursuit of its objectives. Control cost is the amount of resources that are required to implement and maintain a control. Risk tolerance is the acceptable level of variation that an organization is willing to allow for a risk to deviate from its desired level or expected outcome. These factors may influence the risk response or the risk acceptance, but not the likelihood rating. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.4: Risk Register, p. 25-26.

A maturity model is a framework that describes the stages or levels of development and improvement of a certain domain, such as a process, a function, or an organization. A maturity model is most useful to an organization when it provides a reference for progress, meaning that it helps the organization to assess its current state, identify its strengths and weaknesses, set its goals and objectives, and measure itsperformance and improvement over time. A maturity model can also help the organization to compare itself with best practices and standards, but benchmarking against other organizations is not its primary purpose. A maturity model can also help the organization to manage its risks, but defining a qualitative measure of risk or providingrisk metrics is not its main function. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.3.2.1, p. 118-119

Ensuring senior management understands the organization’s risk universe in relation to the IT risk management program is primarily to define effective enterprise IT risk appetite andtolerance levels. This understanding is essential for setting the boundaries within which the organization is willing to operate regarding IT risks.

Defining Effective IT Risk Appetite and Tolerance Levels (Answer A):

Purpose: Senior management needs to understand the range and nature of IT risks to set appropriate risk appetite and tolerance levels.

Impact: This enables the organization to make informed decisions about which risks to accept, mitigate, transfer, or avoid.

Alignment: It ensures that the IT risk management strategy is aligned with the overall business objectives and risk posture of the organization.

Comparison with Other Options:

B. To execute the IT risk management strategy in support of business objectives:

Purpose: While important, it follows the definition of risk appetite and tolerance.

Limitation: Without understanding the risk universe, execution may be misaligned.

C. To establish business-aligned IT risk management organizational structures:

Purpose: Structural alignment is crucial but secondary to setting risk appetite and tolerance.

D. To assess the capabilities and maturity of the organization’s IT risk management efforts:

Purpose: This is part of the ongoing process but not the primary purpose of understanding the risk universe.

 Process owners are the best suited to help a risk practitioner understand the impact of IT-related events on business objectives, as they have the responsibility and authority over the design, execution, and performance of business processes. Process owners are also accountable for the risks and controls associated with their processes, and they can provide valuable input and feedback on the likelihood and impact of IT-related events on the process outcomes and objectives.

The other options are not the best suited to help a risk practitioner understand the impact of IT-related events on business objectives. IT management is responsible for the delivery and support of IT services and solutions, but they may not have the full visibility or understanding of the business objectives and processes. Internal audit is responsible for providing independent and objective assurance and consulting services on the effectiveness and efficiency of governance, risk management, and control processes, but they may not have the direct involvement or influence on the business objectives and processes. Senior management is responsible for settingthe strategic direction and objectives of the organization, but they maynot have the detailed knowledge or experience of the business processes and their risks and controls. References = IT Risk Manager: Skills and Roles & Responsibilities, IT Risk Resources | ISACA, Managing information technology risk | Business Queensland

Alignment to business objectives is the most important factor when developing a business case for a proposed security investment, because it demonstrates how the investment will support the enterprise’s mission, vision, and goals. A business case should show how the security investment will contribute to the value creation, risk reduction, and performance improvement of the enterprise. The other options are not the most important factors, although they may also be included in the business case. The identification of control requirements, the consideration of new business strategies, and the inclusion of strategy for regulatory compliance are secondary factors that depend on the alignment to business objectives. References = Most Asked CRISC Exam Questions and Answers

Risk limits, thresholds, and indicators provide the most useful information to determine risk exposure following control implementations, as they help to measure and monitor the current and residual risk levels and compare them with the desired and acceptable risk levels. Risk limits, thresholds, and indicators are defined as follows:

Risk limits are the maximum amount of risk that an organization is willing to accept for a given activity, process, or objective. Risk limits are derived from the organizational risk appetite and tolerance, and they help to guide the risk response and control selection.

Risk thresholds are the points or levels at which the risk or performance is acceptable or unacceptable. Risk thresholds are used to trigger alerts, actions, or escalation when the risk or performance deviates from the expected or planned range.

Risk indicators are metrics or measures that provide information on the current or potential risk exposure or performance. Risk indicators can be classified into key risk indicators (KRIs), whichmeasure the likelihood and impact of risk events, and key performance indicators (KPIs), which measure the effectiveness and efficiency of controls and processes.

Risk limits, thresholds, and indicators help to determine risk exposure following control implementations by providing quantitative and qualitative data and feedback on the risk and control environment. They also help to identify and prioritize the areas for improvement and enhancement of the risk and control environment. Risk limits, thresholds, and indicators also facilitate the communication, collaboration, and accountability among the stakeholders involved in the risk management and control processes.

The other options are not the most useful information to determine risk exposure following control implementations. Strategic plan and risk management integration is the process of aligning the organizational strategy and objectives with the risk management framework and activities, but it does not provide specific information on the risk exposure or control effectiveness. Risk escalation and process for communication is the process of reporting and escalating the risk issues and incidents to the appropriate authority and stakeholders, but it doesnot provide comprehensive information on the risk exposure or control performance. Policies, standards, and procedures are the documents that define the principles, rules, and guidelines for the risk management and control processes, but they do not provide actual information on the risk exposure or control implementation. References = Risk Limits, Thresholds and Indicators - ISACA, IT Risk Resources | ISACA, Risk Management: Risk Indicators and Risk Appetite

The risk practitioner’s best course of action is to review the design of the machine learning model against the control objectives, because this will help to evaluate the suitability, effectiveness, and reliability of the model as a control measure. A machine learning model is a type of artificial intelligence that can learn from data and make predictions or decisions based on the data. A machine learning model can be used to automate or enhance the access management process, such as by identifying excessive access privileges, detecting unauthorized access, or recommending access rights. However, a machine learning model also introduces new risks and challenges, such as data quality, model accuracy, model bias, model explainability, model security, and model governance. Therefore, the risk practitioner should review the design of the machine learning model against the control objectives, which are the specific goals or outcomes that the control is intended to achieve. The control objectives can be derived from the IT riskmanagement strategy, the IT governance framework, the IT policies and standards, and the regulatory requirements. The review of the machine learning model should cover the following aspects: - The data sources and inputs: The risk practitioner should verify that the data used to train and test the machine learning model is relevant, complete, accurate, consistent, and representative of the access management process and the access rights. The risk practitioner should also check that the data is collected, stored, processed, and transmitted in a secure and compliant manner, and that the data privacy and confidentiality are protected. - The model algorithms and outputs: The risk practitioner should validate that the model algorithms are appropriate, robust, and transparent for the access management process and the control objectives. The risk practitioner should also evaluate that the model outputs are accurate, reliable, and interpretable, and that they provide meaningful and actionable insights orrecommendations for the access management process and the control objectives. - The model performance and monitoring: The riskpractitioner should measure and monitor the model performance and effectiveness against the control objectives and the predefined metrics and indicators. The risk practitioner should also ensure that the model is updated and maintained regularly to reflect the changes in the access management process and the access rights, and that the model is audited and reviewed periodically to ensure its compliance and quality. By reviewing the design of the machine learning model against the control objectives, the risk practitioner can ensure that the model is fit for purpose and adds value to the access management process and the control objectives. The risk practitioner can also identify and mitigate any potential risks or issues that may arise from the use of the machine learning model as a control measure. References = Risk and Information Systems Control Study Manual, Chapter 3: Risk Response and Mitigation, Section 3.3: Control Design and Implementation, pp. 124-1271, Manage roles in your workspace - Azure Machine Learning2, Dataset Inference: Ownership Resolution in Machine Learning3

Residual risk exceeds acceptable limits, because it indicates that the risk level is higher than the organization’s risk appetite or tolerance, and that the risk responses and controls are insufficient or ineffective. Residual risk is the level of risk remaining in a process or procedure following the implementation of risk controls to limit or remove it. Escalation is a process that increases theawareness and involvement of higher-level stakeholders or authorities in a risk issue or situation. Escalation is appropriate when the risk issue or situation is outside the scope or authority of the current risk owner or manager, and requires the attention or action of the senior management or the board of directors. Residual risk exceeding acceptable limits is the best situation to justify escalation, as it implies that the current risk owner or manager cannot manage the risk within the predefined boundaries or expectations, and that the senior management or the board of directors need to intervene or approve the risk acceptance or transfer.

Residual risk being inadequately recorded, residual risk remaining after controls have been applied, and residual risk equaling current risk are all possible situations that may require escalation, but they are not the best situations, as they do not necessarily indicate that the risk level is higher than the acceptable limits, and that the senior management or the board of directors need to be involved.

The risk practitioner’s first course of action when an assessment of information security controls has identified ineffective controls should be A. Determine whether the impact is outside the risk appetite1

According to the CRISC Review Manual, risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Risk appetite reflects the organization’s risk culture, strategy, and values2

When an assessment of information security controls has identified ineffective controls, it means that the controls are not providing the expected level of protection or assurance for the information assets or processes. This may result in increased exposure or vulnerability to threats, or reduced ability to achieve objectives. Therefore, the risk practitioner should first determine whether the impact of the ineffective controls is outside the risk appetite, as this would indicate the need for urgent action or escalation3

The other options are not the first course of action when an assessment of information security controls has identified ineffective controls, because:

•B. Requesting a formal acceptance of risk from senior management may be appropriate if the impact of the ineffective controls is within the risk appetite, and the organization decides to accept the risk as it is. However, this should not be the first course of action, as it may not address the root cause of the ineffective controls, or the potential consequences or opportunities for improvement4

•C. Reporting the ineffective control for inclusion in the next audit report may be part of the risk communication and reporting process, but it should not be the first course of action, as it may delay the resolution or mitigation of the issue, or the implementation of corrective actions. Moreover, the next audit report may not be timely or relevant for the decision-makers or stakeholders who need to be informed of the ineffective controls5

•D. Deploying a compensating control to address the identified deficiencies may be a possible risk response option, but it should not be the first course of action, as it may require further analysis, evaluation, and approval. Moreover, deploying a compensating control may not be the most effective or efficient solution, as it may introduce additional complexity, cost, or risk.

1: CRISC Review Questions, Answers & Explanations Database, Question ID: 100003 2: CRISC Review Manual, 7th Edition, page 28 3: CRISC Review Manual, 7th Edition, page 223 4: CRISC Review Manual, 7th Edition, page 224 5: CRISC Review Manual, 7th Edition, page 225 : CRISC Review Manual, 7th Edition, page 226

According to the CRISC Review Manual, an enterprise-wide ethics training and awareness program is one of the key elements of a strong risk culture, as it helps to promote ethical behavior, raise awareness of risk management principles and practices, and foster a culture of accountability and transparency2

1: Developing Collective Risk Leadership Through CRISC - ISACA 2: CRISC Review Manual, 7th Edition, page 23

Control effectiveness is the degree to which a control achieves its intended objective and mitigates the risk that it is designed to address. It is measured by comparing the actual performance and outcome of the control with the expected or desired performance and outcome.

The best method for assessing control effectiveness is continuous monitoring, which is the process of collecting, analyzing, and reporting on the performance and outcome of the controls on an ongoing basis. Continuous monitoring provides timely and accurate information on the status and results of the controls, and enables the identification and correction of any issues or gaps in the control environment.

Continuous monitoring can be performed using various techniques, such as automated tools, dashboards, indicators, metrics, logs, audits, reviews, etc. Continuous monitoring can also be integrated with the risk management process, and aligned with the organization’s objectives and risk appetite.

The other options are not the best methods for assessing control effectiveness, because they do not provide the same level of timeliness, accuracy, and completeness of information on the performance and outcome of the controls.

Ad hoc control reporting is the process of collecting, analyzing, and reporting on the performance and outcome of the controls on an irregular or occasional basis. Ad hoc control reporting may be triggered by specific events, requests, or incidents, and it may not cover all the relevant or critical controls. Ad hoc control reporting may not provide sufficient or consistentinformation on the control effectiveness, and it may not enable the timely and proactive identification and correction of any issues or gaps in the control environment.

Control self-assessment is the process of allowing the control owners or operators to evaluate and report on the performance and outcome of their own controls. Control self-assessment can provide useful insights and feedback from the control owners or operators, and it can enhance their awareness and accountability for the control effectiveness. However, control self-assessment may not be objective, reliable, or independent, and it may not cover all the relevant or critical controls. Control self-assessment may not provide sufficient or consistent information on the control effectiveness, and it may not enable the timely and proactive identification and correction of any issues or gaps in the control environment.

Predictive analytics is the process of using statistical techniques and models to analyze historical and current data, and to make predictions or forecasts about future events or outcomes. Predictive analytics can provide useful insights and trends on the potential performance and outcome of the controls, and it can support the decision making and planning for the control effectiveness. However, predictive analytics may not be accurate, valid, or reliable, and it may not reflect the actual or current performance and outcome of the controls. Predictive analytics may not provide sufficient or consistent information on the control effectiveness, and it may not enable the timely and proactive identification and correction of any issues or gaps in the control environment. References =

ISACA, CRISC Review Manual, 7th Edition, 2022, pp. 40-41, 47-48, 54-55, 58-59, 62-63

ISACA, CRISC Review Questions, Answers & Explanations Database, 2022, QID 150

CRISC Practice Quiz and Exam Prep

Occurrences of specific events are the most likely to cause a key risk indicator (KRI) to exceed thresholds, as they represent the actual or potential realization of the risk. A KRI is a metric that measures the level of risk exposure and the effectiveness of risk response strategies, and it has predefined thresholds that indicate the acceptable or unacceptable risk status. When a specific event occurs that affects the risk, such as a security breach, a system failure, or a compliance violation, the KRI value may change and exceed the thresholds, triggering an alert or an action. A performance measurement, the risk tolerance level, and risk scenarios are not the most likely to cause a KRI to exceed thresholds, as they do not reflect the actual or potential occurrence of the risk, but rather the expected or desired outcome, limit, or simulation of the risk. References = [CRISC Review Manual (Digital Version)], page 121; CRISC by Isaca Actual Free Exam Q&As, question 217.

A risk factor is a condition or event that may increase the likelihood or impact of a risk, which is the effect of uncertainty on objectives1. An information systems review is a process that involves examining and evaluating the adequacy and effectiveness of the information systems and their related controls, policies, and procedures2. The purpose of an information systems review is to identify and report the risk factors that may affect the confidentiality, integrity, availability, and performance of the information systems and their outputs3. The best way to ensure that the risk factors identified during an information systems review are addressed is to assign action items and deadlines to specific individuals, who are responsible and accountable for implementing the appropriate risk responses. A risk response is an action taken or plannedto mitigate or eliminate the risk, such as avoiding, transferring, reducing, or accepting the risk4. By assigning action items and deadlines to specific individuals, the organization can ensure that the risk factors are properly and promptly addressed, and that the progress and results of the risk responses are monitored and reported5. Informing business process owners of the risk, reviewing and updating the risk register, and implementing new control technologies are not the best ways to ensure that the risk factors identified during an information systems review are addressed, as they do not provide the same level of accountability and effectiveness as assigning action items anddeadlines to specific individuals. Informing business process owners of the risk is a process that involves communicating and sharing the risk information with the persons who have the authority and accountability for a business process that is supported or enabled by the information systems6. Informing business process owners of the risk can help to raise their awareness and understanding of the risk, but it does not ensure that they will take the necessary actions to address the risk. Reviewing and updating the risk register is a process that involves checking and verifying that the risk register, which is a document that records and tracks the risks and their related information, is current, complete, and consistent7. Reviewing and updating the risk register can help to reflect the changes and updates in the risk factors and their status, but it does not ensure that the risk factors are resolved or reduced. Implementing new control technologies is a process that involves introducing or applying new software or hardware that can help to prevent, detect, or correct the risk factors affecting the information systems8. Implementing new control technologies can help to improve the security and performance of the information systems, but it does not ensure that the risk factors are eliminated or mitigated. References = 1: Risk Factors - an overview | ScienceDirect Topics2: InformationSystems Audit and Control Association (ISACA) - ISACA3: Information Systems Audit: The Basics4: Risk Response Strategy and Contingency Plans - ProjectManagement.com5: Risk and Information Systems Control Study Manual, Chapter 3: Risk Response, Section 3.1: Risk Response Options, pp. 113-115.6: [Business Process Owner - Gartner IT Glossary] 7: Risk Register: A Project Manager’s Guide with Examples [2023] • Asana8: Technology Control Automation: Improving Efficiency, Reducing … - ISACA : [Business Process Owner - Roles and Responsibilities] : [Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.1: Risk Identification, pp. 57-59.] : [Risk and Information Systems Control Study Manual, Chapter 4: Risk and Control Monitoring and Reporting, Section 4.2: Risk Monitoring, pp. 189-191.]

Acost-benefit analysisevaluates the financial implications of acquiring cyber insurance versus the potential loss exposure. This approach enables informed decision-making by comparing the insurance cost with the potential savings from covered risks.

Regular reviewshelp detect inappropriate, outdated, or excessive access rights. This is a fundamental part of access control governance and supports the principle of least privilege.

A risk assessment is a process of identifying, analyzing, and evaluating the risks that may affect the enterprise’s objectives and operations. It involves determining the likelihood and impact of various risk scenarios, and prioritizing them based on their significance and urgency.

A WiFi access point is a device that allows wireless devices to connect to a wired network using radio signals. It can provide convenience and flexibility for users, but it can also introduce security risks, such as unauthorized access, data leakage, malware infection, or denial of service attacks.

If departments have installed their own WiFi access points on the enterprise network, without proper authorization, configuration, or monitoring, it means that they have bypassed the network security policy and controls, and created potential vulnerabilities and exposures for the enterprise.

The most important information to include in a report to senior management is the potential business impact of this risk, which is the estimated loss or damage that the enterprise may suffer if the risk materializes. The potential business impact can be expressed in terms of financial, operational, reputational, or legal consequences, and it can help senior management to understand the severity and urgency of the risk, and to decide on the appropriate risk response and allocation of resources.

The other options are not the most important information to include in a report to senior management, because they do not convey the magnitude and significance of the risk, and they may not be relevant or actionable for senior management.

The network security policy is the set of rules and guidelines that define the security objectives, requirements, and responsibilities for the enterprise network. It is important to have a clear and comprehensive network security policy, and to ensure that it is communicated, enforced, and monitored across the enterprise, but it is not the most important information to include in a report to senior management, because it does not indicate the actual or potential impact of the risk, and it may not reflect the current or desired state of the network security.

The WiFi access point configuration is the set of parameters and settings that define the functionality, performance, and security of the WiFi access point. It is important to have a secure and consistent WiFi access point configuration, and to follow the best practices and standards for wireless network security, but it is not the most important information to include in a report to senior management, because it does not indicate the actual or potential impact of the risk, and it may not be relevant or understandable for senior management.

The planned remediation actions are the steps and measures that are intended to mitigate, transfer, avoid, or accept the risk, and to restore the normal operation and security of the enterprise network. It is important to have a feasible and effective plan for remediation actions, and to implement and monitor them in a timely and efficient manner, but it is not the most important information to include in a report to senior management, because it does not indicate the actual or potential impact of the risk, and it may not be feasible or appropriate without senior management’s approval or support. References =

ISACA, CRISC Review Manual, 7th Edition, 2022, pp. 19-20, 23-24, 27-28, 31-32, 40-41, 47-48

ISACA, CRISC Review Questions, Answers & Explanations Database, 2022, QID 146

 The primary reason for establishing various threshold levels for a set of key risk indicators (KRIs) is to take appropriate actions in a timely manner. KRIs are metrics that provide information on the level of exposure to a given risk or the effectiveness of the controls in place. Threshold levels are predefined values that indicate when the risk level is acceptable, tolerable, or unacceptable. By establishing various threshold levels for a set of KRIs, the enterprise can monitor the risk situation and trigger the necessary responses before the risk becomes too severe or costly to mitigate. The other options are not the primary reasons for establishing various threshold levels, although they may be secondary benefits or outcomes of doing so. References = Risk and Information Systems Control Study Manual, Chapter 5: Risk and Control Monitoring and Reporting, page 189.

 Customer behavior data is the information that reflects how customers interact with a brand, product, or service, such as their preferences, needs, motivations, and feedback1. Collecting customer behavior data through social media advertising can help an organization to understand its target market, improve its customer experience, and optimize its marketing strategies2.

However, collecting customer behavior data through social media advertising also poses significant business risks, especially for a global organization that operates in different countries. Among the four options given, the most important business risk to be considered is the regulatory requirements that may differ in each country. This means that the organization should:

Be aware of the different laws and regulations that govern the collection, processing, storage, and transfer of personal data in each country, such as the GDPR in the EU, the CCPA in California, or the PDPA in Singapore3

Ensure that the organization complies with the relevant data protection and privacy rules and standards in each country, such as obtaining consent, providing notice, ensuring security, and respecting rights4

Avoid or mitigate the potential legal, financial, reputational, or operational consequences of violating the data protection and privacy laws and regulations in each country, such as fines, lawsuits, sanctions, or loss of trust5

References = What is Customer Behavior Data?, How to Collect Customer Behavior Data for Marketing, Data Protection Laws Around the World, Data Protection and Privacy: The Age of Intelligent Machines, The Risks of Non-Compliance with Data Protection Laws

Architecture is the design and structure of a system or a process, such as an IT system or a business process. Architecture documentation is the document that describes and explains the architecture, such as its components, functions, relationships, requirements, constraints, orstandards. Architecture documentation can help to understand, communicate, and improve the system or the process1.

An environment that lacks documentation of the architecture faces a great risk of unknown vulnerabilities, which are the weaknesses or flaws in the system or the process that could be exploited by threats or attackers, but are not identified or addressed by the organization. Unknown vulnerabilities can pose a serious risk to the organization, because they can:

Compromise the confidentiality, integrity, and availability of the system or the process, and the information or resources that it handles or supports

Cause financial, operational, reputational, or legal damages or losses to the organization, such as data breaches, fraud, errors, delays, or fines

Remain undetected or unresolved for a long time, and increase the exposure or impact of the risk over time

Require more resources or efforts to mitigate or recover from the risk, and reduce the efficiency or effectiveness of the risk management process23

Lack of documentation of the architecture can increase the risk of unknown vulnerabilities, because it can:

Prevent or hinder the identification and assessment of the vulnerabilities, and the evaluation and prioritization of the risks

Impede or delay the implementation and enforcement of the controls or safeguards to prevent or reduce the vulnerabilities, and the monitoring and reporting of the risk status and progress

Obstruct or limit the communication and coordination among the stakeholders, and the awareness and accountability of the risk owners and users

Restrict or hamper the review and improvement of the system or the process, and the learning and feedback of the risk management4

The other options are not the greatest risks associated with an environment that lacks documentation of the architecture, but rather some of the possible causes or consequences of it.Legacy technology systems are outdated or obsolete systems that are still in use by the organization, but are no longer supported or maintained by the vendors or developers. Legacy technology systems can be a cause of lack of documentation of the architecture, as they may have been developed or acquired without proper documentation, or the documentation may have been lost or discarded over time. Network isolation is the separation or segregation of a network or a system from other networks or systems, either physically or logically, to prevent or limit the access or communication between them. Network isolation can be a consequence of lack of documentation of the architecture, as it may result from the inability or difficulty to integrate or connect the system or the process with other systems or processes. Overlapping threats are threats that affect more than one system or process, or have similar or related sources or causes, such as natural disasters, cyberattacks, or human errors. Overlapping threats can be a consequence of lack of documentation of the architecture, as they may arise from the lack of understanding or coordination of the system or the process with other systems or processes. References =

Architecture Documentation - ISACA

Vulnerability - ISACA

The Risks of Not Having a Vulnerability Management Program

The Importance of Architecture Documentation - ISACA

[The Risk of Poor Document Control - ComplianceBridge]

[CRISC Review Manual, 7th Edition]

According to the CRISC Review Manual1, the application owner is the person who has the authority and accountability for the achievement of the application objectives and the management of the associated risks. The application owner is responsible for defining the level of resiliency needed for the application, which is the ability of the application to recover from disruptions and continue to operate. The application owner is also responsible for accepting or rejecting the residual risks after the implementation of the disaster recovery controls, which are the measures to restore the application functionality and data in the event of a disaster. Therefore, the risk owner in this scenario is the application owner, as they are the ones who will be affected by the potential impact of the disaster on the application and its objectives. References = CRISC Review Manual1, page 194.

A risk register is a tool that records and tracks the identified risks, their causes, impacts, likelihood, responses, and owners. The owner for each risk scenario is the person or group whohas the authority and accountability to manage the risk and its response. The best way to identify the owner for each risk scenario in a risk register is to map the identified risk factors tospecific business processes. Risk factors are the internal and external variables that influence the occurrence and impact of risks. Business processes are the activities that produce value for the enterprise, such as sales, marketing, production, or delivery. By mapping the risk factors to the business processes, the risk practitioner can determine which business process is affected by or contributes to the risk, and who is responsible for the business process. The owner for each risk scenario should be the person or group who is responsible for the business process that is associated with the risk. The other options are not the best way to identify the owner for each risk scenario, as they involve different criteria or methods:

Determining which departments contribute most to risk means that the risk practitioner evaluates the degree of involvement or exposure of each department to the risk. This may not be a reliable or consistent way to identify the owner for each risk scenario, as the risk may span across multiple departments, or the department may not have the authority or accountability to manage the risk.

Allocating responsibility for risk factors equally to asset owners means that the risk practitioner assigns the same level of responsibility to each person or group who owns an asset that is affected by or contributes to the risk. An asset is a resource that has value for the enterprise, such as hardware, software, data, or people. This may not be a fair or effective way to identify the owner for each risk scenario, as the asset owners may have different levels of involvement or exposure to the risk, or may not have the authority or accountability to manage the risk.

Determining resource dependency of assets means that the risk practitioner analyzes the relationship and interdependence of the assets that are affected by or contribute to the risk. This may help to identify the potential impact or likelihood of the risk, but it does not directly help to identify the owner for each risk scenario, as the resource dependency may not reflect the authority or accountability to manage the risk. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 3, Section 3.1.1.1, pp. 95-96.

The most important risk consideration when the global company’s business continuity plan (BCP) requires the transfer of its customer information to a cloud computing environment in the event of a disaster is that the cloud computing environment is shared with another company. A cloud computing environment is a service model that provides on-demand access to a shared pool of computing resources, such as servers, storage, networks, and applications. A shared cloud computing environment means that the same computing resources are used by multiple customers or tenants, and that the data and activities of one customer may affect or be affected by the data and activities of another customer. This may pose a significant risk to the security, privacy, and availability of the customer information, as it may be exposed, accessed, modified, or deleted by unauthorized or malicious parties. The other options are not as important as the cloud computing environment being shared with another company, as they are related to the differences, agreements, or cultures of the company or the country, not the environment or the platform of the customer information transfer. References = Risk and Information Systems Control Study Manual, Chapter 3: IT Risk Response, Section 3.3: IT Risk Response Implementation, page 145.

A virus transmitted on a USB thumb drive is a scenario that represents a threat, as it involves a malicious or harmful event that could compromise the confidentiality, integrity, or availability of an information system. A virus is a type of malware that can infect and damage files, programs, or devices by replicating itself and spreading to other systems or networks. A USB thumb drive is a portable storage device that can be used to transfer data between computers or devices. Avirus transmitted on a USB thumb drive can occur when a user inserts an infected USB thumb drive into a computer or device, or when a user downloads or copies an infected file from a USB thumb drive to a computer or device. A virus transmitted on a USB thumb drive can pose a serious risk to the information system, as it can corrupt or delete data, disrupt or degrade performance, steal or leak information, or allow unauthorized access or control.

The other options are not scenarios that represent a threat, but rather vulnerabilities or weaknesses that could increase the likelihood or impact of a threat. Connecting a laptop to a free, open, wireless access point (hotspot) is a vulnerability, as it exposes the laptop to potential eavesdropping, interception, or manipulation by malicious actors on the same network. Visitorsnot signing in as per policy is a vulnerability, as it creates a gap in the physical security and access control of the premises, and could allow unauthorized or malicious visitors to enter or access sensitive areas or assets. Storing corporate data in unencrypted form on a laptop is a vulnerability, as it reduces the protection and security of the data, and could enable unauthorized or malicious access, disclosure, or modification of the data in case of loss, theft, or compromise of the laptop. References = What is a Computer Virus? | McAfee, What is a USB Flash Drive? | Kingston Technology, Threats, Vulnerabilities, and Exploits – oh my!

Involve the development team in planning is the best recommendation to help reduce IT risk associated with scheduling overruns when starting a new application development project. This is because involving the development team in planning can help ensure that the project scope, requirements, resources, and timeline are realistic, feasible, and agreed upon by all stakeholders. It can also help improve the communication, collaboration, and commitment of the development team, as well as identify and mitigate potential risks and issues early in the project life cycle. According to the CRISC Review Manual 2022, one of the key risk identification techniques for IT projects is to involve the project team and other relevant parties in the risk assessment process1. According to the CRISC Review Questions, Answers & Explanations Manual 2022, involving the development team in planning is the correct answer to this question2.

Implementing a tool to track the development team’s deliverables, reviewing the software development life cycle, and assigning more developers to the project team are not the best recommendations to help reduce IT risk associated with scheduling overruns. These are possible actions that can be taken during or after the planning phase, but they do not address the root cause of the risk, which is the lack of involvement of the development team in planning. Implementing a tool to track the development team’s deliverables can help monitor the project progress and performance, but it does not guarantee that the deliverables are aligned with the project objectives and expectations. Reviewing the software development life cycle can help ensure that the project follows a structured and standardized process, but it does not account for the specific needs and challenges of the project. Assigning more developers to the project team can help increase the project capacity and productivity, but it can also introduce new risks such as coordination, communication, and quality issues.

The best approach is tocollaborate with the control ownerto understand root causes and determine next steps. This respects ownership and enables targeted, informed decision-making before implementing drastic changes.

 The best recommendation to address the situation where personal information from the production environment is required for testing purposes in non-production environments is to de-identify data before being transferred to the test environment. De-identification is the process of removing or modifying any personally identifiable information (PII) or other sensitive data from the data sets, such as names, addresses, phone numbers, email addresses, etc., so that the data cannot be traced back to specific individuals. De-identification protects the privacy and confidentiality of the data, while still allowing for testing, analysis, or training purposes. Enabling data encryption, preventing the use of production data, and enforcing multi-factor authentication are also useful measures, but they do not eliminate the risk of data breaches or unauthorized access to PII. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.3.1, page 3-21.

Scenario analysis and stress testing are the best methods to enable an organization to determine whether external emerging risk factors will impact the organization’s risk profile, as they help to simulate and evaluate the potential outcomes and effects of various risk events and scenarios on the enterprise’s objectives and operations. Scenario analysis and stress testing can help to identify and assess the impact of external emerging risk factors, such as changes in the market, technology, regulation, or environment, and to measure the resilience and preparedness oftheenterprise to cope with these factors. Control identification and mitigation, adoption of a compliance-based approach, and prevention and detection techniques are not the best methods to enable an organization to determine whether external emerging risk factors will impact the organization’s risk profile, as they do not help to simulate and evaluate the potential outcomes and effects of various risk events and scenarios, but rather to manage and monitor the existing or known risks. References = CRISC: Certified in Risk & Information Systems Control Sample Questions, question 223.

The risk practitioner’s best course of action after identifying risk scenarios related to noncompliance with new industry regulations is to escalate to senior management, as they have the authority and responsibility to decide on the appropriate risk response and allocate the necessary resources. Transferring the risk, implementing monitoring controls, and recalculating the risk are possible risk responses, but they require senior management approval and direction. References = Risk Scenarios Toolkit, page 19; CRISC Review Manual, 7th Edition, page 107.

The best way is toassess the loss impactif information is compromised. This aligns with ISACA’s risk management approach, which prioritizes the potential impact on business objectives and regulatory compliance when valuing information assets.

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 An IT risk appetite statement is a document that expresses the amount and type of IT risk that an organization is willing to accept or pursue in order to achieve its objectives. An IT risk appetite statement can help guide the IT risk management process, by setting the boundaries, criteria, andtargets for IT risk identification, assessment, response, and reporting. An IT risk appetite statement should be aligned with the organization’s overall risk appetite and strategy, and should be reviewed and updated periodically to reflect the changes in the internal and external environment. One of the factors that would most likely result in updates to an IT risk appetite statement is changes in senior management. Senior management is the group of executives who have the authority and responsibility for the strategic direction and performance of the organization. Changes in senior management can affect the IT risk appetite statement, as they may introduce new perspectives, priorities, expectations, or preferences for IT risk taking or avoidance. Changes in senior management can also affect the IT risk appetite statement, as they may require new or revised IT objectives, goals, or initiatives, which may entail different levelsor types of IT risk. Therefore, changes in senior management should trigger a review and update of the IT risk appetite statement, to ensure that it is consistent and compatible with the new leadership and direction of the organization. References = Organisations must define their IT risk appetite and tolerance, Risk Appetite Statements - Institute of Risk Management, Develop Your Technology Risk Appetite - Gartner.

The MOST effective way to help ensure an organization’s current risk scenarios are relevant is to involve the stakeholders in the risk assessment process, because they are the ones who have the knowledge, experience, and interest in the risk scenarios that affect their domains and objectives. The involvement of stakeholders can help to identify and validate the risk scenarios, to provide input and feedback on the risk analysis and evaluation, and to ensure the alignment andintegration of the risk scenarios with the business processes and goals. The other options are not as effective as the involvement of stakeholders, because:

Option A: Adoption of industry best practices is a good way to improve the quality and consistency of the risk scenarios, but it does not ensure their relevance to the organization’s specific context and environment. Industry best practices are general and standardized guidelines that may not reflect the organization’s unique risks and needs.

Option C: Review of risk scenarios by independent parties is a useful way to verify and enhance the accuracy and reliability of the risk scenarios, but it does not ensure their relevance to the organization’s internal and external stakeholders. Independent parties are objective and impartial reviewers who may not have the same knowledge, experience, and interest as the stakeholders.

Option D: Documentation of potential risk in business cases is a helpful way to communicate and justify the importance and value of the risk scenarios, but it does not ensure their relevance to the organization’s current and future state. Business cases are concise and persuasive documents that may not capture all the aspects and dimensions of the risk scenarios. References = Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, p. 104.

Identifying stakeholders ensures that all perspectives are considered, contributing to a holistic view of risk and improving communication and response planning.

The management action that will most likely change the likelihood rating of a risk scenario related to remote network access is implementing multi-factor authentication. Multi-factor authentication is a technique that requires the user to provide two or more pieces of evidence to verify their identity, such as a password, a token, or a biometric factor. Multi-factor authentication can help to reduce the likelihood of unauthorized or malicious access to theremote network, as it adds an extra layer of security and makes it harder for the attackers to compromise the user credentials. The other options are not as likely to change the likelihood rating of the risk scenario, as they are related to the update, creation, or maintenance of the remote network access, not the verification or protection of the remote network access. References = Risk and Information Systems Control Study Manual, Chapter 3: IT Risk Response, Section 3.3: IT Risk Response Implementation, page 145.

The completion of a project for implementing a new control would most likely require a risk practitioner to update the risk register. The risk register is a document that records the identified risks, their analysis, and their responses. The completion of a project for implementing a new control means that a risk response has been executed and a new control has been established. This may affect the likelihood and/or impact of the related risks, and the residual risk level. Therefore, the risk practitioner should update the risk register to reflect the current status and outcome of the risk response and the new control. The other options are not as likely to require a risk practitioner to update the risk register, as they are related to the reporting, planning, or assessment of the risks or the controls, not the implementation or completion of the risk response or the new control. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.4: IT Risk Response, page 87.

Defining recovery time objectives (RTOs) and acceptable data loss thresholds is critical for effective disaster response, ensuring recovery activities are aligned with business priorities. This supportsBusiness Continuity Planning.

Communicating risk assessments to senior management is crucial for ensuring that key decision-makers are aware of the organization's risk landscape. This awareness enables informed decision-making regarding risk responses, resource allocation, and strategic planning. It also fosters a risk-aware culture throughout the organization.

Classifying IT assets during a risk assessment is a process of assigning values to the IT assets based on their importance, sensitivity, and criticality to the enterprise. The best reason to classify IT assets is todetermine the appropriate level of protection that each IT asset requires, based on its value and the potential impact of its loss or compromise. This helps the enterprise to allocate resources and implement controls that are proportional to the risk exposure of the IT assets, and to optimize the cost and benefit of risk mitigation. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 233. CRISC by Isaca Actual Free Exam Q&As, Question 9. CRISC Sample Questions 2024, Question 233. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 233.

The primary objective of risk management is to achieve business objectives, as risk management involves identifying, assessing, responding, and monitoring the risks that may affect the desired outcomes and performance of the organization, and aligning them with the risk tolerance and appetite of the organization. Identifying and analyzing risk, minimizing business disruptions, andidentifying threats and vulnerabilities are not the primary objectives, as they are more related to the process, outcome, or source of risk management, respectively, rather than the purpose or value of risk management. References = CRISC Review Manual, 7th Edition, page 99.

 The greatest benefit of identifying appropriate risk owners is that accountability is established for risk treatment decisions. Risk owners are the individuals or groups who are responsible and accountable formanaging a specific risk and its associated actions and outcomes. By identifying appropriate risk owners, the organization can ensure that the risk treatment decisions are made by the people who have the authority, knowledge, and interest in the risk. Stakeholders beingconsulted, risk owners being informed, and responsibility being established are other possible benefits, but they are not as great as accountability being established. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 8; CRISC Review Manual, 6th Edition, page 97.

The most significant risk to an organization when updating the incident response plan is the undefined assignment of responsibility. An incident response plan is a document that defines the roles, responsibilities, procedures, and resources for responding to an incident that could disrupt the normal operations of the organization, or compromise its assets, reputation, or compliance. An incident response plan should clearly assign the responsibility for each task and activity involved in the incident response process, such as detection, containment, analysis, eradication, recovery, and reporting. Undefined assignment of responsibility could lead to confusion, duplication, conflict, or omission among the stakeholders, and impair the effectiveness and efficiency of the incident response process. Undefined assignment of responsibility could also increase the risk of escalation, recurrence, or impact of the incident, and affect the accountability and performance of the organization. Obsolete response documentation, increased stakeholder turnover, and failure to audit third-party providers are also risks, but they are not as significant as undefined assignment of responsibility, as they do not directly affect the execution and outcome of the incident response process. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 130.

The primary reason to implement a formalized risk taxonomy is to reduce subjectivity in risk management, as it provides a common and consistent language and structure for identifying, classifying, and reporting risks, and facilitates the comparison and aggregation of risks across the organization. The other options are not the primary reasons, as they are more related to the outcomes, benefits, or drivers of risk management, respectively, rather than the reason for risk management. References = CRISC Review Manual, 7th Edition, page 100.

According to the CRISC Review Manual, the primary purpose of periodically reviewing an organization’s risk profile is to enable risk-based decision making, because it helps to ensure thatthe risk information is current, relevant, and accurate. The risk profile is a snapshot of the organization’s risk exposure at a given point in time, based on the risk identification, analysis, and evaluation processes. Periodically reviewing the risk profile allows the organization tomonitor the changes in the risk environment, the effectiveness of the risk responses, and the impact of the risk events. This enables the organization to make informed decisions about the risk management strategies and priorities. The other options are not the primary purpose of periodically reviewing the risk profile, as they are related to other aspects of the risk management process. Aligning business objectives with risk appetite is the purpose of establishing the risk context, which defines the scope and boundaries of the risk management activities. Designing and implementing risk response action plans is the purpose of the risk response process, which involves selecting and executing the appropriate risk responses. Updating risk responses in the risk register is the outcome of the risk monitoring and reporting process, which involves tracking the risk performance and communicating the risk information to the stakeholders. References = CRISC Review Manual, 7th Edition, Chapter 2, Section 2.2.4, page 86.

 Implementing controls to bring the risk to a level within appetite and accept the residual risk is the best recommendation to senior management when the results of a risk and control assessment indicate a risk scenario can only be partially mitigated, as it helps to balance the costs and benefits of the risk management and control processes, and to align them with the organizational strategy and objectives. A risk and control assessment is a process of identifying, analyzing, and evaluating the risks and controls associated with a specific activity, process, or objective. A risk scenario is a description of a possible event or situation that could cause harm or loss to the organization or its stakeholders. A risk scenario can only be partially mitigated when the existing or proposed controls are not sufficient or effective to reduce the risk to an acceptable level. A risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. A residual risk is the risk that remains after the implementation of controls or risk treatments.

Implementing controls to bring the risk to a level within appetite and accept the residual risk helps to provide the following benefits:

It enables a data-driven and evidence-based approach to risk management and reporting, rather than relying on subjective or qualitative judgments.

It facilitates a consistent and standardized way of measuring and communicating risk levels and exposure across the organization and to the external stakeholders.

It supports the development and implementation of effective and efficient risk response and mitigation strategies and actions that are aligned with the business risk appetite and objectives.

It provides feedback and learning opportunities for the risk management and control processes, and helps to foster a culture of continuous improvement and innovation.

The other options are not the best recommendations to senior management when the results of a risk and control assessment indicate a risk scenario can only be partially mitigated. Implementing a key performance indicator (KPI) to monitor the existing control performance is a useful method to measure and monitor the effectiveness and efficiency of the controls, but it does not address the residual risk or the risk appetite. Accepting the residual risk in its entirety andobtaining executive management approval is a possible option to deal with the risk scenario, but it may expose the organization to excessive or unacceptable risk, and it may not comply with the legal or regulatory obligations or requirements. Separating the risk into multiple components and avoiding the risk components that cannot be mitigated is a possible option to deal with the risk scenario, but it may not be feasible or practical, and it may create new or additional risks or challenges. References = Risk and Control Self-Assessment (RCSA) - Management Study Guide, IT Risk Resources | ISACA, Risk Mitigation: What It Is and How to Implement It (Free Templates …

Residual risk is the level of risk that remains after applying controls or other risk treatments. A critical patch is a type of control that aims to reduce the risk of a known vulnerability being exploited by attackers. If the patch implementation fails, the control is ineffective and the risk is not reduced. Therefore, the residual risk is increased, as the organization is still exposed to the potential negative consequences of the vulnerability.

The most helpful information to review when determining a system’s criticality is the associated business impact analysis (BIA). A BIA is a process of identifying and evaluating the potential effects of disruptions to the organization’s critical business functions and processes. A BIA can help to determine the system’s criticality by assessing its impact on the organization’s objectives, performance, and value. Process flow, service level agreement (SLA), and system architecture are other possible information sources, but they are not as helpful as the BIA. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 4; CRISC Review Manual, 6th Edition, page 153.

The primary objective for selecting risk response options is to reduce risk to an acceptable level. Risk response options are the possible actions that can be taken to address the risks that have been identified and analyzed in the risk management process. Risk response options can be classified into four categories: avoid, transfer, mitigate, and accept for negative risks (or threats), and exploit, share, enhance, and accept for positive risks (or opportunities). The selection of the risk response options depends on various factors, such as the risk level, the risk appetite and tolerance, the cost and benefit, and the feasibility and availability of the options. The main goal of selecting the risk response options is to reduce the risk to a level that is acceptable to the organization, which means that the risk exposure is within the boundaries of the risk criteria and the risk appetite. The other options are not the primary objective for selecting risk response options, although they may be related or beneficial. Identifying compensating controls is a technique to implement additional or alternative controls when the existing controls are not effective or sufficient to reduce the risk to an acceptable level. Minimizing residual risk is a result of selecting and implementing the risk response options, but it is not the main purpose. Residual risk is the risk that remains after the risk response, and it may or may not be acceptable depending on the risk appetite and tolerance. Reducing risk factors is a method to decrease the likelihood or impact of the risk by addressing the root causes or sources of the risk. However,reducing risk factors does not necessarily mean that the risk is reduced to an acceptable level,as there may be other factors or uncertainties that affect the risk. References = CRISC Review Manual, pages 32-331; CRISC Review Questions, Answers & Explanations Manual, page 862

The risk management process is the systematic and continuous process of identifying, analyzing, evaluating, and treating the risks that may affect the organization’s objectives, operations, or assets1. The risk management process should be aligned with the organization’s overall risk management framework and strategy, and support the organization’s value creation and protection2.

Having the risk management process reviewed by a third party is a good practice that can provide various benefits for the organization, such as:

Enhancing the credibility and reliability of the risk management process and outcomes

Identifying and addressing any weaknesses, gaps, or errors in the risk management process and controls

Providing independent and objective feedback and recommendations for improving the risk management process and performance

Ensuring compliance with the relevant laws, regulations, and standards for risk management3

Among the four options given, the primary reason to have the risk management process reviewed by a third party is to obtain an objective view of process gaps and systemic errors. This means that the third party can help to:

Assess the adequacy and effectiveness of the risk management process and its alignment with the organization’s risk appetite and tolerance

Detect and report any inconsistencies, inefficiencies, or inaccuracies in the risk identification, analysis, evaluation, or treatment activities

Identify and prioritize the root causes and consequences of the process gaps and systemic errors, and their impact on the organization’s risk exposure and acceptance

Suggest and implement corrective or preventive actions that can resolve or mitigate the process gaps and systemic errors, and prevent their recurrence

References = Risk Management Process - ISO 31000, Enterprise Risk Management - Wikipedia, How to Select a Third-Party Risk Management Framework

A key performance indicator (KPI) is a measurable value that demonstrates how effectively an organization is achieving its objectives. In the context of disaster recovery planning (DRP), a KPI should reflect the ability of the organization to recover its critical business processes and applications within the predefined time frames and service levels. One of the most important KPIs for DRP is the percentage of applications that met the recovery time objective (RTO) during DRP testing. The RTO is the maximum acceptable length of time that a business process or application can be down after a disaster. By measuring the percentage of applications that met the RTO during DRP testing, the organization can evaluate the performance and reliability of its DRP, identify any gaps or weaknesses, and implement corrective actions to improve its readiness and resilience. The other options are not the best KPIs for DRP, as they do not directly measure the effectiveness of the recovery process. The number of users that participated in the DRP testing is a measure of the involvement and awareness of the staff, but not of the outcome of the testing. The number of issues identified during DRP testing is a measure of the quality and completeness of the DRP, but not of the actual recovery time. The percentage of issues resolved as a result of DRP testing is a measure of the improvement and maturity of the DRP, but not of the current recovery capability. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 3, Section 3.2.3.3, Page 138.

A standardized risk taxonomy is a common language and structure for identifying, analyzing, and reporting risks across the enterprise. It enables consistent and comparable risk assessment and aggregation, as well as clear communication and coordination among different divisions. A list of control deficiencies, an enterprise risk ownership policy, and an updated risk tolerance metric are not sufficient to enable management of risk at the enterprise level, as they do not address the issue of risk alignment and integration among divisions. References = [CRISC Review Manual (Digital Version)], page 42; CRISC by Isaca Actual Free Exam Q&As, question 197.

User accounts provisioning is the process of creating, managing, and modifying user accounts within a system or an application, based on the user’s roles, responsibilities, and requirements. User accounts provisioning is an essential part of identity and access management (IAM), which aims to ensure the confidentiality, integrity, and availability of the system or the application, and the information or resources that it handles or supports1.

The best key performance indicator (KPI) for monitoring adherence to an organization’s user accounts provisioning practices is the percentage of accounts without documented approval, because it can help to measure how well the organization follows the policies, standards, and procedures for user accounts provisioning, and how effectively the organization controls andaudits the user accounts provisioning activities. The percentage of accounts without documented approval can indicate:

The level of compliance and accountability of the user accounts provisioning process, and the extent to which the user accounts provisioning requests and actions are authorized and verified by the appropriate parties, such as managers, IT staff, or security officers

The level of risk and exposure of the user accounts provisioning process, and the likelihood and impact of unauthorized or inappropriate user accounts provisioning, such as granting excessive or unnecessary access privileges, creating duplicate or fraudulent accounts, or violating legal or regulatory requirements

The level of quality and efficiency of the user accounts provisioning process, and the ability and capacity of the organization to manage and maintain the user accounts provisioning records and documents, such as forms, logs, or reports23

The other options are not the best KPIs for monitoring adherence to an organization’s user accounts provisioning practices, but rather some of the factors or outcomes of it. User accountswith default passwords are user accounts that have not changed their passwords from the initial or default values that are assigned by the system or the application. User accounts with default passwords are a factor that can increase the risk of unauthorized or malicious access to the system or the application, as the default passwords may be easily guessed or compromised by attackers. Active accounts belonging to former personnel are user accounts that have not been deactivated or deleted after the users have left the organization. Active accounts belonging to former personnel are an outcome of ineffective or inefficient user accounts deprovisioning, which is the process of revoking or removing the user accounts and access privileges when they are no longer needed or valid. Accounts with dormant activity are user accounts that have not been used or accessed for a long period of time. Accounts with dormant activity are an outcome of poor or inconsistent user accounts management, which is the process of updating or modifying the user accounts and access privileges according to the changes or needs of the users or the organization4. References =

User Provisioning for SaaS Apps: Top 10 Best Practices | Resmo

Top Identity and Access Management Metrics

KPI-driven approach to Identity & Access Management - Elimity

[CRISC Review Manual, 7th Edition]

In addition to the risk register, which is a tool to document and monitor the risks that affect the organization, a risk practitioner should review the business objectives of the organization to develop an understanding of its risk profile. The risk profile is a description of the set of risks that the organization faces in relation to its goals and strategies. By reviewing the business objectives, the risk practitioner can identify the sources, drivers, and consequences of the risks, as well as the alignment, prioritization, and tolerance of the risks. The business objectives also provide the context and criteria for evaluating and managing the risks. The other options are not the best choices to review for developing an understandingof the organization’s risk profile, as they do not capture the full scope and nature of the risks. The control catalog is a list of the existing controls that are implemented to mitigate the risks, but it does not reflect the effectiveness, efficiency, or sufficiency of the controls. The asset profile is a description of the resources and capabilities that the organization possesses or relies on, but it does not indicate the value, vulnerability, or interdependency of the assets. The key risk indicators (KRIs) are metrics that measure the level and trend of the risks, but they do not explain the causes, impacts, orresponses to the risks. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.1.2, Page 49.

A cause-and-effect diagram, also known as a fishbone diagram or an Ishikawa diagram, is a graphical tool that helps to identify and analyze the potential causes and effects of a problem or an event. A cause-and-effect diagram can be used to develop technical risk scenarios related to a recently developed ERP system, because it can help to:

Break down the complex problem or event into manageable and measurable categories and subcategories of causes and effects

Visualize the relationships and interactions among the various factors that contribute to the problem or event

Identify the root causes and the most significant effects of the problem or event

Generate ideas and hypotheses for testing and validating the problem or event

Communicate and present the problem or event clearly and logically to the stakeholders1

A cause-and-effect diagram can be constructed by following these steps:

Define the problem or event and write it in a box on the right side of the diagram

Draw a horizontal line from the box to the left side of the diagram, representing the main spine of the fishbone

Identify the major categories of causes that affect the problem or event, such as people, process, technology, environment, etc., and write them on the branches of the spine

For each category, brainstorm and list the possible subcategories and specific causes that influence the problem or event, and write them on the sub-branches of the spine

For each cause, identify and list the possible effects or consequences that result from the problem or event, and write them on the sub-sub-branches of the spine

Analyze the diagram and prioritize the causes and effects based on their frequency, severity, and controllability

Develop technical risk scenarios based on the most critical causes and effects, and describe how they could affect the ERP system and the organization1

 Performing a gap analysis is the best recommendation for a risk practitioner upon learning of an updated cybersecurity regulation that could impact the organization. A gap analysis can help identify the current state of compliance, the desired state of compliance, and the actions needed to achieve compliance. Conducting system testing, implementing compensating controls, and updating security policies are possible actions that may result from the gap analysis, but they arenot the best initial recommendation. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 1; CRISC Review Manual, 6th Edition, page 143.

 A change in the risk profile would be the most important information to communicate to stakeholders after an annual risk assessment is completed, as it indicates how the risk landscape of the organization has changed over time, and how it affects the achievement of the business goals and objectives. A decrease in threats, an increase in reported vulnerabilities, and an increase in identified risk scenarios are also important information, but they are not the most important, as they are specific aspects of the risk profile, and do not provide a holistic view of the risk exposure and appetite of the organization. References = CRISC Review Manual, 7th Edition, page 109.

The most effective practice in protecting personally identifiable information (PII) from unauthorized access in a cloud environment is to utilize encryption with logical access controls. Encryption is a technique that transforms the data into an unreadable or unintelligible form, making it inaccessible or unusable by unauthorized parties. Logical access controls are the mechanisms or rules that regulate who can access, view, modify, or delete the data, based on their identity, role, or privilege. By utilizing encryption with logical access controls, the PII can be protected from unauthorized access, disclosure, or theft, both in transit and at rest, in a cloud environment. The other options are not as effective as utilizing encryption with logical access controls, as they are related to the classification, separation, or audit of the data, not the protection or security of the data. References = Risk and Information Systems Control Study Manual, Chapter 3: IT Risk Response, Section 3.3: IT Risk Response Implementation, page 145.

Noncompliance cost reflects the impact or penalties from deviating from policies. Per ISACA governance best practices, exceptions should only be granted when this cost is understood and deemed acceptable relative to business needs.

The main benefit of using a top-down approach to develop risk scenarios is that it establishes the relationship between risk events and organizational objectives. A top-down approach is a method of risk identification and analysis that starts with the organization’s strategic objectives and then identifies the potential risk events that could affect or prevent the achievement of those objectives. A top-down approach helps to establish the relationship between risk events and organizational objectives, because it links the risk scenarios to the organization’s mission, vision, values, and strategy, and it prioritizes the risk scenarios based on their impact and relevance to the organization’s objectives. A top-down approach also helps to align and communicate the risk scenarios with the organization’s stakeholders, such as the board, management, and business units, and to facilitate the risk response and monitoring activities. The other options are not the main benefit of using a top-down approach, although they may be part of or derived from the top-down approach. Describing risk events specific to technology used by the enterprise, using hypothetical and generic risk events specific to the enterprise, and helping management and the risk practitioner to refine risk scenarios are all activities or outcomes that could be performed or achieved by using a top-down approach, but they are not the primary purpose or result of the top-down approach. References = Risk and Information Systems Control Study Manual, Chapter 4, Section 4.2.1, page 4-13.

 Scenario analysis is a technique that helps to identify significant events that could impact an organization by creating and exploring plausible alternative futures. Scenario analysis can help anticipate and prepare for potential changes, opportunities, or threats in the internal or external environment, such as technological, economic, social, political, legal, or environmental factors.Scenario analysis can also help evaluate the impact and likelihood of different risk scenarios, and test the effectiveness and robustness of various risk response strategies. Scenario analysis can provide a comprehensive and holistic view of risks and their interrelationships, and support the decision making and planning process for risk management. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.4: IT Risk Scenarios, p. 49-50.

The best tool for communicating strategic risk priorities is a heat map. A heat map is a graphical representation of the risk profile of an enterprise, showing the likelihood and impact of various risks on a matrix. A heat map can help to highlight the most significant risks that require attention, as well as the risk appetite and tolerance levels of the enterprise. A heat map can also facilitate the comparison of risks across different business units, processes, or objectives, and enable the communication of risk information to stakeholders in a clear and concise manner. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 5, Section 5.3.1, page 240.

According to the CRISC Review Manual (Digital Version), the first course of action when a risk practitioner discovers several key documents detailing the design of a product currently in development have been posted on the Internet is to invoke the established incident response plan, which is a set of policies, procedures, and resources that enable the organization to respond to and recover from an incident that affects the confidentiality, integrity, or availability of its IT assets and processes. Invoking the incident response plan helps to:

Contain and isolate the incident and prevent further damage or loss

Identify and analyze the source, cause, and impact of the incident

Eradicate and eliminate the incident and restore normal operations

Communicate and coordinate the incident response activities and roles with the relevant stakeholders, such as the business owner, the risk owner, the senior management, and the external parties

Learn and improve from the incident and update the incident response plan and the risk register

References = CRISC Review Manual (Digital Version), Chapter 4: IT Risk Monitoring and Reporting, Section 4.1: IT Risk Monitoring, pp. 219-2201

Key risk indicators (KRIs) are metrics that provide information on the level of exposure to a given risk. They enable ongoing monitoring of emerging risk by alerting the organization when the risk level exceeds thepredefined threshold or tolerance. By using KRIs, the organization can track the changes in the risk environment and take timely and appropriate actions to mitigate or avoid the risk.

Helping an organization identify emerging threats, benchmarking the organization’s risk profile, and identifying trends in the organization’s vulnerabilities are all possible uses of KRIs, but they are not the primary benefit. The primary benefit is to enable ongoing monitoring of emerging risk, which encompasses all these aspects and more. References = CRISC Review Manual, 7th Edition, ISACA, 2020, page 27-281

Key performance indicators (KPIs) are metrics used to measure and evaluate the achievement of the organization’s objectives and strategies1. KPIs for critical IT assets are KPIs that focus onthe performance and value of the IT assets that are essential for the organization’s operations and functions2. KPIs for critical IT assets may include metrics such as availability, reliability, utilization, cost, and security of the IT assets3. The need to review and update KPIs for critical IT assets may be driven by various factors, such as changes in the business environment, customer expectations, or regulatory requirements. However, the most likely factor that would drive the need to review and update KPIs for critical IT assets is the outcomes of periodic risk assessments. A risk assessment is a process that involves identifying, analyzing, and evaluating the risks and their potential impacts on the organization’s objectives and performance4. A periodic risk assessment is a risk assessment that is performed at regular intervals, such as monthly, quarterly, or annually, to capture the changes and updates in the risk environment and the risk profile5. The outcomes of periodic risk assessments would most likely drive the need to review and update KPIs for critical IT assets, as they would provide insights into the current and emerging risks that may affect the performance and value of the critical IT assets, as well as the effectiveness and efficiency of the existingand planned controls and responses. By reviewing and updating the KPIs for critical IT assets based on the outcomes of periodic risk assessments, the organization can ensure that the KPIs are relevant, realistic, and aligned with the organization’s risk appetite and tolerance, and that they provide accurate and timely information for decision making and reporting. The outsourcing of related IT processes, changes in service level objectives, and findings from continuous monitoring are not the most likely factors that would drive the need to review and update KPIs for critical IT assets, as they do not provide the same level of information and impact as the outcomes of periodic risk assessments. The outsourcing of related IT processes is a decision that involves transferring some or all of the IT processes that support or enable the critical IT assets to an external service provider. The outsourcing of related IT processes may affect the performance and value of the critical IT assets, but it does not necessarily require a review and update of the KPIs for critical IT assets, as the KPIs may still be valid and applicable for the outsourced IT processes. Changes in service level objectives are changes in the expected or agreed level of quality or performance of the IT services that support or enable the critical IT assets. Changes in service level objectives may affect the performance and value of the critical IT assets, but they do not necessarily require a review and update of theKPIs for critical IT assets, as the KPIs may still be consistent and compatible with the changed service level objectives. Findings from continuous monitoring are the results or outcomes of the ongoing observation and measurement of the performance and compliance of the IT processes and systems that support or enable the critical IT assets. Findings from continuous monitoring may affect the performance and value of the critical IT assets, but they do not necessarily require a review and update of the KPIs for critical IT assets, as the KPIs may still be relevant and reliable for the continuously monitored IT processes and systems. References = Risk and Information Systems Control Study Manual, Chapter 4: Risk and Control Monitoring and Reporting, Section 4.2: Risk Monitoring, pp. 189-191.

Residual risk is the level of risk remaining after controls and mitigation are applied. An effective awareness program reduces the likelihood of incidents (e.g., phishing, human error), thereby lowering residual risk. Inherent risk remains unchanged, as it is independent of controls.

External audit reports are independent and objective, typically conducted under standard frameworks (e.g., SOC 2). They assess the third party’s controls in a structured and verifiable manner, offering the highest assurance of confidentiality protections.

Enforcing segregation of duties between the vendor master file and invoicing is the best process control to mitigate the risk of an employee issuing fraudulent payments to a vendor. This is because segregation of duties is a key internal control that prevents or detects errors, fraud, orabuse by ensuring that no single person can perform incompatible or conflicting tasks. The vendor master file is a database that contains the information and settings for each vendor, such as name, address, bank account, payment terms, etc. Invoicing is the process of generating and sending bills to the vendors for the goods or services they provide. If the same person can access and modify the vendor master file and issue invoices, he or she could create fictitious vendors, alter vendor information, or generate false or duplicate invoices, and then divert the payments to his or her own account. By segregating these duties, the organization can reduce the opportunity and likelihood of such fraudulent activities. According to the CRISC Review Manual 2022, segregation of duties is one of the key IT control objectives and practices1. According to the web search results, segregation of duties between the vendor master file and invoicing is a common and recommended control to prevent vendor fraud

A security log is a record of security-related events or activities that occur in an IT system, network, or application, such as user authentication, access control, firewall activity, or intrusion detection1. Security logscan help to monitor and audit the security posture and performance of the IT environment, and to detect and investigate any security incidents, breaches, or anomalies2.

The integrity of a security log refers to the accuracy and completeness of the log data, and the assurance that the log data has not been modified, deleted, or tampered with by unauthorized or malicious parties3. The integrity of a security log is essential for ensuring the reliability and validity of the log analysis and reporting, and for providing evidence and accountability for security incidents and compliance4.

Among the four options given, the most important factor to the integrity of a security log is the inability to edit. This means that the security log data should be protected from any unauthorized or accidental changes or alterations, such as adding, deleting, or modifying log entries, or changing the log format or timestamps5. The inability to edit can be achieved by implementing various controls and measures, such as:

Applying digital signatures or hashes to the log data to verify its authenticity and integrity

Encrypting the log data to prevent unauthorized access or disclosure

Implementing least privilege access to the log data to restrict who can view, modify, or delete the log data

Using write-once media or devices to store the log data, such as CD-ROMs or WORM drives

Sending the log data to a secure and centralized log server or repository, and using syslog or other protocols to ensure secure and reliable log transmission

Performing regular backups and archiving of the log data to prevent data loss or corruption

References = Security Log: Best Practices for Logging and Management, Security Audit Logging Guideline, Confidentiality, Integrity, & Availability: Basics of Information Security, Steps for preserving the integrity of log data, Guide to Computer Security Log Management

Determining Controls:

Acceptable Risk Level: The level of acceptable risk to the organization is the most important consideration because it directly influences the type and extent of controls implemented. Controls must be designed to keep risk within acceptable levels.

Risk Management Strategy: Aligning controls with the organization's risk appetite ensures that resources are used effectively and that critical information systems are adequately protected.

Comparison with Other Options:

Number of Threats: Important for understanding risk exposure but secondary to determining acceptable risk levels.

Available Budget: Budget constraints are important but should not compromise the implementation of necessary controls.

Number of Vulnerabilities: Identifying vulnerabilities is part of the risk assessment process, but controls are prioritized based on the acceptable risk level.

Best Practices:

Risk Assessment: Conduct thorough risk assessments to understand the potential impact of threats and vulnerabilities.

Control Effectiveness: Implement controls that are both cost-effective and capable of reducing risk to acceptable levels.

Continuous Monitoring: Regularly monitor and review controls to ensure they remain effective and aligned with the organization's risk tolerance.

A risk management program is a systematic and structured approach to identify, analyze, evaluate, treat, monitor, and communicate the risks that may affect the organization’s objectives and performance.

The greatest advantage of implementing a risk management program is enabling risk-aware decisions. This means that the organization incorporates the risk information and analysis into its decision making process, such as strategic planning, resource allocation, project management, etc.

Enabling risk-aware decisions helps to optimize the outcomes and benefits of the decisions, balance the opportunities and threats of the decisions, and align the decisions with the organization’s risk appetite and tolerance.

The other options are not the greatest advantages of implementing a risk management program. They are either secondary or not essential for risk management.

The references for this answer are:

Risk IT Framework, page 25

Information Technology & Security, page 19

Risk Scenarios Starter Pack, page 17

The group that has primary ownership of reputational risk stemming from unethical behavior within the organization is A. Board of directors. According to the CFA Institute, the board of directors is responsible for setting the tone at the top and ensuring that the company adheres to high ethical standards and values. The board of directors also oversees the company’s culture, governance, and risk management practices, and holds the management accountable for any misconduct or breach of trust1 The board of directors may delegate some of its oversight functions to other committees, such as the human resources, risk management, or audit committee, but ultimately, the board of directors bears the ultimate responsibility for the company’s reputation and integrity

According to the CRISC Review Manual (Digital Version), the risk register is the most useful component of the review of the overall risk profile from the targeted organization, as it providesa comprehensive and up-to-date record of the identified risks, their likelihood and impact, their risk response actions, and their residual risk levels. The risk register helps to:

Understand the current and potential threats and vulnerabilities that may affect the targeted organization’s objectives and performance

Evaluate the effectiveness and efficiency of the risk management processes and controls implemented by the targeted organization

Identify the gaps or weaknesses in the risk management practices and capabilities of the targeted organization

Assess the compatibility and alignment of the risk appetite and risk tolerance of the targeted organization with the acquiring organization

Estimate the value and benefits of the acquisition and the potential risks and costs involved

References = CRISC Review Manual (Digital Version), Chapter 1: IT Risk Identification, Section 1.5: IT Risk Identification Methods and Techniques, pp. 38-391

The percentage of projects with developed controls on scope creep is the best key performance indicator (KPI) to measure how effectively risk management practices are embedded in the project management office (PMO), as it reflects the ability of the PMO to identify, assess, and respond to the risk of project scope changes that may affect the project objectives, budget, and schedule. The other options are not the best KPIs, as they do not directly measure the effectiveness of risk management practices in the PMO, but rather the outcomes or consequences of risk management decisions. References = CRISC Review Manual, 7th Edition, page 110.

The primary reason for prioritizing risk scenarios is to facilitate risk response decisions. Risk scenarios are hypothetical situations that describe the possible causes, events, and consequences of a risk. Prioritizing risk scenarios is the process of ranking the risk scenarios according to their level of importance, urgency, or impact. Prioritizing risk scenarios helps to facilitate risk response decisions, which are the choices made to address the risks, such as avoiding, transferring, mitigating, or accepting the risks. Prioritizing risk scenarios helps to allocate the resources and efforts to the most significant or critical risk scenarios, and to select the most appropriate and effective risk responses. Prioritizing risk scenarios also helps to communicate and justify the risk response decisions to the stakeholders, and to monitor and report the risk status and performance. Providing an enterprise-wide view of risk, supporting risk response tracking, and assigning risk ownership are not the primary reasons for prioritizing risk scenarios, as they are either theinputs or the outputs of the risk prioritization process, and they do not address the primary need of responding to the risks. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 50.

A noncompliant control is a control that does not meet the requirements or standards of an audit, regulation, or policy. A noncompliant control can expose the organization to risks such as errors, fraud, or breaches. When a noncompliant control is identified, the service provider and the client should work together to resolve the issue as soon as possible. However, sometimes the resolution may not be feasible or cost-effective, and the client may decide to accept the risk associated with the noncompliant control.

In this case, the service provider’s most appropriate action would be to ask the client to document the formal risk acceptance for the provider. This means that the client should acknowledge the existence and consequences of the noncompliant control, and provide a written justification for accepting the risk. The risk acceptance document should also specify the roles and responsibilities of the service provider and the client, and the duration and conditions of the risk acceptance. The risk acceptance document should be signed by the client’s senior management and the service provider’s management, and kept as part of the audit evidence.

The other options are not appropriate actions for the service provider. Developing a risk remediation plan overriding the client’s decision would be disrespectful and unprofessional, as it would ignore the client’s authority and preference. Making a note for this item in the next audit explaining the situation would be insufficient and misleading, as it would imply that the issue is still unresolved and that the service provider is responsible for it. Insisting that the remediation occur for the benefit of other customers would be unreasonable and impractical, as it woulddisregard the client’s business needs and constraints, and potentially harm the relationship between the service provider and the client. References =

Risk Acceptance - Institute of Internal Auditors

New Guidance on the Evaluation of Non-compliance with the Risk Assessment Standard and its Peer Review Impact - REVISED

The Impact of Non-compliance: Understanding The Risks And Consequences

The control owner is the person who is responsible for designing, implementing, monitoring, and maintaining a control. The control owner is best suited to determine whether a new control properly mitigates data loss risk within a system, as they have the most knowledge and authority over the control. The control owner should also evaluate the effectiveness and efficiency of the control and report any issues or gaps to the risk owner.

The other options are not the best suited to determine whether a new control properly mitigates data loss risk within a system. The data owner is the person who has the accountability and authority over the data and its classification. The data owner may not have the technical expertise or access to evaluate the new control. The risk owner is the person who has the accountability and authority to manage a specific risk. The risk owner may not have the detailed knowledge orinvolvement in the new control. The system owner is the person who has the accountability and authority over the system and its operation. The system owner may not have the direct responsibility or oversight of the new control. References = CRISC TOPIC 3 EXAM SHORT Flashcards, CRISC-1-50 topic3 Flashcards, CRISC Certified in Risk and Information Systems Control – Question609

 Risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Risk appetite can be expressed in qualitative or quantitative terms, and can vary depending on the context and the stakeholder. Risk appetite should be defined and communicated by the senior management or the board of directors, and should guide the risk management decisions and actions throughout the organization. When a project team has accepted a risk outside the established risk appetite, the risk practitioner’s best course of action is to escalate the risk decision to the project sponsor for review, meaning that the risk practitioner should report the risk acceptance and its rationale to the project sponsor, who is the person or group that provides the resources and support for the project, and is accountable for its success. The project sponsor should review the risk decision and determine whether it is aligned with the organization’s objectives and strategy, and whether it requires any further approval oraction. References = Risk and Information Systems Control Study Manual, Chapter 1, Section 1.3.1, p. 25-26

User recertification is the most effective control to ensure user access is maintained on a least-privilege basis, as it involves a periodic review and validation of user access rights and privileges by the appropriate authority. User recertification helps to identify and remove any unnecessary, excessive, or obsolete access rights and privileges that may pose a security risk or violate the principle of least privilege. User recertification also helps to ensure that user access rights and privileges are aligned with the current business needs, roles, and responsibilities of the users.

The other options are not the most effective controls to ensure user access is maintained on a least-privilege basis. User authorization is the process of granting or denying access rights and privileges to users based on their identity, role, and credentials, but it does not verify or update the existing access rights and privileges of the users. Change log review is the process of examining and analyzing the records of changes made to the system, configuration, or data, but it does not directly address the user access rights and privileges. Access log monitoring is the process of tracking and auditing the user activities and actions on the system or network, but it does not validate or modify the user access rights and privileges. References = What Is the Principle of Least Privilege and Why is it Important?, Principle of Least Privilege: Definition, Methods & Examples, IT Risk Resources | ISACA

According to the CRISC Review Manual (Digital Version), the organization’s culture is the most important factor affecting risk management in an organization, as it influences the riskawareness, risk attitude, risk behavior and risk communication of all stakeholders. The organization’s culture is defined as the shared values, beliefs, norms and expectations that guide the actions and interactions of the members of the organization. The organization’s culture affects how risk management is perceived, supported, implemented and integrated within the organization. A strong risk culture is one that:

Aligns with the organization’s vision, mission, strategy and objectives

Promotes a common understanding of risk and its implications for the organization

Encourages the identification, assessment, response and monitoring of risks at all levels

Fosters a proactive, collaborative and transparent approach to risk management

Empowers and rewards the stakeholders for taking ownership and accountability of risks

Enables continuous learning and improvement of risk management capabilities and maturity

References = CRISC Review Manual (Digital Version), Chapter 1: IT Risk Identification, Section 1.3: IT Risk Culture, pp. 23-251

A third-party security assessment report is the most helpful to ensure effective security controls for a cloud service provider, because it provides an independent and objective evaluation of the cloud provider’s security posture, policies, and practices. A third-party security assessment report can help to verify and validate the cloud provider’s compliance with the relevant standards, regulations, and best practices, such as ISO 27001, PCI DSS, NIST, or CSA. A third-party security assessment report can also help to identify and address any gaps, weaknesses, or vulnerabilities in the cloud provider’s security controls, and to provide recommendations and guidance for improvement. A third-party security assessment report can also help to increase the trust and confidence of the cloud customers, and to facilitate the due diligence and risk management processes. The other options are less helpful to ensure effective security controls for a cloud service provider. A control self-assessment is a process that enables the cloud provider to assess its own security controls, using a predefined framework or questionnaire. However, a control self-assessment may not be as reliable or comprehensive as a third-party security assessment report, as it may be biased, incomplete, or inaccurate, and it may not cover all the aspects or dimensions of security. Internal audit reports from the vendor are documents that provide the results and findings of the internal audits conducted by the cloud provider’s ownauditors, to verify and validate the effectiveness and efficiency of the securitycontrols. However, internal audit reports from the vendor may not be as credible or trustworthy as a third-party security assessment report, as they may be influenced by the cloud provider’s interests, objectives, or agenda, and they may not follow the same standards or criteria as the external auditors. Service level agreement monitoring is a process that measures and evaluates the performance and availability of the cloud services, based on the predefined metrics and targets agreed between the cloud provider and the cloud customer. However, service level agreement monitoring may not be sufficient or relevant to ensure effective security controls for a cloud service provider, as it may not address the security aspects or requirements of the cloud services, such as confidentiality, integrity, or accountability, and it may not reflect the actual security risks or incidents that may occur in the cloud environment. References = Cloud Security Controls: Key Elements and 4 Control Frameworks 1

A change management process is a set of procedures and activities that ensure that any changes to the IT systems or applications are planned, approved, tested, implemented, and documented in a consistent and controlled manner.

A change management process has recently been updated with new testing procedures. This means that the process has been improved or modified to include new or additional steps or methods for verifying and validating the changes before they are deployed to the production environment.

The next course of action after updating the change management process with new testing procedures is to communicate to those who test and promote changes. This means that the change management team or function should inform and educate the people who are involved or affected by the changes, such as the developers, testers, users, customers, etc., about the new testing procedures, their purpose, benefits, requirements, and expectations.

Communicating to those who test and promote changes helps to ensure that the new testing procedures are understood and followed by all the parties, that the changes are tested and promoted in accordance with the process standards and criteria, and that the changes are delivered with the expected quality and performance.

The other options are not the next courses of action after updating the change management process with new testing procedures. They are either secondary or not essential for change management.

The references for this answer are:

Risk IT Framework, page 27

Information Technology & Security, page 21

Risk Scenarios Starter Pack, page 19

Key risk indicators (KRIs) are metrics used by organizations to monitor and assess potential risks that may impact their objectives and performance. KRIs also provide early warning signals that help organizations identify, analyze, and address risks before they escalate into significant issues1. Effective KRIs are thosethat are relevant, measurable, predictable, comparable, and informational2. The most important factor for developing effective KRIs is including input from risk and business unit management, as they are the persons who have the best understanding of the risk environment, the risk appetite and tolerance, and the risk factors and impacts of the organization. By including input from risk and business unit management, the organization can ensure that the KRIs are aligned with the organization’s strategy, vision, and mission, and that they reflect the current and emerging risks and their potential consequences. Engaging sponsorship by senior management, utilizing data and resources internal to the organization, and developing in collaboration with internal audit are not the most important factors for developing effective KRIs, as they do not provide the same level of insight and relevance as including input from risk and business unit management. Engaging sponsorship by senior management is a factor that involves obtaining the support and approval of the senior leaders who have the authority and accountability for the organization’s performance and governance. Engaging sponsorship by senior management can help to promote the importance and value of KRIs, and to ensure their communication and implementation across the organization, but it does not ensure that the KRIs are appropriate and accurate for the organization’s risk profile. Utilizing data and resources internal to the organization is a factor that involves using the information and assets that are available within the organization to support or enable the development of KRIs. Utilizing data and resources internal to the organization can help to enhance the quality and reliability of KRIs, and to reduce the cost and complexity of obtaining external data and resources, but it does not ensure that the KRIs are comprehensive and consistent with the organization’s risk environment. Developing in collaboration with internal audit is a factor that involves working with the internal audit function that provides independent and objective assurance and advice on the adequacy and effectiveness of the organization’s risk management. Developing in collaboration with internal audit can help to improve the validity and compliance of KRIs, and to provide feedback and recommendations for improvement, but it does not ensure that the KRIs are relevant and realistic for the organization’s risk objectives and strategies. References = 1: Key Risk Indicators: A Practical Guide | SafetyCulture2: KRI Framework for Operational Risk Management | Workiva3: [Risk and Information Systems Control Study Manual, Chapter 4: Risk and Control Monitoring and Reporting, Section 4.1: Key Risk Indicators, pp. 181-185.]

According to the CRISC 351-400 topic3 Flashcards, the administrative access represents a segregation of duties conflict, which should be of greatest concern to a risk practitioner. Segregation of duties is a principle that aims to prevent fraud, errors, or abuse of power by ensuring that no single person can perform incompatible functions, such as development, testing, and production. By having administrative access to a production application, a software developer can potentially modify the code, bypass the testing and approval process, and deploy the changes without proper authorization or documentation. This can compromise the integrity, availability, and security of the application, and expose the organization to operational, financial, legal, or reputational risks. Therefore, the answer is D. The administrative access represents a segregation of duties conflict. *References

According to the definition of key control indicators (KCIs), they are metrics that provide information on the extent to which a given control is meeting its intended objectives in terms of loss prevention, reduction, etc.1 Therefore, option D is the correct answer, as it reflects the purpose and function of KCIs. The other options are not accurate descriptions of KCIs, as they do not directly relate to the performance or outcome of the control. Option A is more relevant to the efficiency or productivity of the control, not its effectiveness. Option B is more relevant to the role of key risk indicators (KRIs), which measure the level of risk exposure or potentialimpact of risk events2. Option C is also more related to KRIs, as they monitor changes in the likelihood or frequency of adverse events due to risk factors2.

Unapproved changes to firewall rules can lead tocritical security vulnerabilitiesordisruptions to business services, representing adirect impact on the business. This is more critical than documentation or governance concerns.

 The business application owner should have the authority to accept the associated risk, because they are responsible for the performance and outcomes of the critical application, and they understand the business requirements, expectations, and impact of the application. The business application owner can also evaluate the trade-offs between the potential benefits and costs of the application, and the potential risks and consequences of a disruption or failure of the application. The business application owner can also communicate and justify their risk acceptance decision to the senior management and other stakeholders, and ensure that the risk is monitored and reviewed regularly. The other options are less appropriate to have the authority to accept the associated risk. The business continuity director is responsible for overseeing the planning and execution of the business continuity strategy, which includes ensuring the availability andresilience of the critical business processes and applications. However, they are not the owner of the application, and they may not have the full knowledge or authority to accept the risk on behalf of the business. The disaster recovery manager is responsible for managing the recovery and restoration of the IT systems and applications in the event of a disaster or disruption. However, they are not the owner of the application, and they may not have the full knowledge or authority to accept the risk on behalf of the business. The data center manager is responsible for managing the operation and maintenance of the data center infrastructure, which includes providing the physical and environmental security, power, cooling, and network connectivity for the IT systems and applications. However, they are not the owner of the application, and they may not have the full knowledge or authority to accept the risk on behalf of the business. References = Risk IT Framework, ISACA, 2022, p. 181

Comprehensive and Detailed Explanation From Exact Extract:

The business process manager is best suited to own business continuity controls because they have direct responsibility for the continuity of the business process and understand the criticality of maintaining operations during disruptions. While security officers and operations managers have important roles, the business process manager is accountable for ensuring the process continues to meet business objectives and should lead continuity efforts【5:513, 5:514†CRISC_SentenceinNOTE30.pptx】.

The most effective way to reduce risk associated with an increase of online transactions on a retailer website is to implement website activity monitoring. Website activity monitoring can help to detect and prevent fraudulent transactions, unauthorized access, data breaches, and other cyber threats that may compromise the security and integrity of the website and its data. Scalable infrastructure, a hot backup site, and transaction limits are other possible ways to reduce risk, but they are not as effective as website activity monitoring. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 7; CRISC Review Manual, 6th Edition, page 202.

According to the CRISC Review Manual1, a risk action plan is a document that defines the specific actions, resources, responsibilities, and timelines for implementing the risk responses. A risk action plan should be developed after the results of a vulnerability assessment are shared with the relevant stakeholders, such as the business manager, to address the identified vulnerabilities and mitigate the associated risks. Developing a risk action plan is the next step in the risk management process, as it helps to ensure that the risk responses are executed effectively and efficiently, and that the residual risks are within the acceptable levels. References = CRISC Review Manual1, page 201.

 According to the Data Roles and Responsibilities article, the business owner is the person who has authority over the business process that is supported by the data. The business owner is responsible for defining the access roles to protect the sensitive data within the application, as well as approving the access requests and ensuring the compliance with the data policies andstandards. The business owner may delegate this responsibility to a data steward, who is a person who acts on behalf of the business owner to manage the data quality, security, and usage. Therefore, the answer is D. Business owner. References = Data Roles and Responsibilities

 The most effective way to promote organization-wide awareness of data security in response to an increase in regulatory penalties for data leakage is to require training on the data handling policy, as it educates the employees on the importance, requirements, and procedures of data protection, and enhances their knowledge and skills to prevent, detect, and respond to data leakage incidents. Enforcingsanctions for noncompliance with security procedures, conducting organization-wide phishing simulations, and requiring regular testing of the data breach response plan are not the most effective ways, as they are more related to the enforcement, evaluation, or improvement of the data security, respectively, rather than the promotion of the data security awareness. References = CRISC Review Manual, 7th Edition, page 155.

Using cloud-based backup tominimize the impactof a potential data loss event is a classic example ofrisk mitigation, which involves reducing risk to an acceptable level through proactive controls.

The business manager is best suited to assess the impact of potential data loss when outsourcing a key database to an external service provider.

Role of the Business Manager:

Understanding Business Impact:The business manager has a comprehensive understanding of the business processes, the criticality of the data, and the potential impact of data loss on business operations.

Decision Making:They are responsible for making decisions regarding risk tolerance, business continuity, and aligning the risk management practices with business objectives.

Assessment of Data Loss Impact:

Operational Impact:The business manager can evaluate how data loss would affect day-to-day operations and overall business continuity.

Financial and Reputational Impact:They can also assess the financial repercussions and potential damage to the organization’s reputation, providing a holistic view of the impact.

Authentication is a control that verifies the identity of a user or a system that tries to access a computer system or network. Authentication can be based on something the user or system knows (such as a password or a PIN), something the user or system has (such as a token or asmart card), or something the user or system is (such as a fingerprint or a retina scan). Authentication is a crucial control for preventing unauthorized or malicious access to a system or network, as well as for ensuring the accountability and traceability of the actions performed by the user or system. If the authentication control is compromised, it means that the user or system can bypass or break the verification process and gain access to the system or network without being identified or authorized. This can expose the system or network to various threats, such as data theft, data corruption, data leakage, or denial of service. Therefore, the authentication control has most likely been compromised if a system administrator identifies unusual activity indicating an intruder within a firewall. A firewall is a device or a software that monitors and filters the incoming and outgoing network traffic based on predefined rules and policies. A firewall can help to protect the system or network from external or internal attacks by blocking or allowing the traffic based on the source, destination, protocol, or content. However, a firewall cannot prevent an intruder from accessing the system or network if the intruder has already authenticated or impersonated a legitimate user or system. The other options are not the most likely controls to be compromised if a system administrator identifies unusual activity indicating an intruder within a firewall, although they may be affected or related. Data validation is a control that checks the accuracy, completeness, and quality of the data that is entered, processed,or stored by a system or anetwork. Data validation can help to prevent or detect data errors, anomalies, or inconsistencies that may affect the performance, functionality, or reliability of the system or network. However, data validation does not prevent or detect unauthorized or malicious access to the system or network, as it only focuses on the data, not the user or system. Identification is a control that assigns a unique identifier to a user or a system that tries to access a computer system or network. Identification can be based on a username, an email address, a phone number, or a certificate. Identification is a necessary but not sufficient control for preventing unauthorized or malicious access to a system or network, as it only declares who or what the user or system is, but does not prove it. Identification needs to be combined with authentication to verify the identity of the user or system. Data integrity is a control that ensures that the data is accurate, consistent, and complete throughout its lifecycle. Data integrity can be achieved by implementing various controls, such as encryption, hashing, checksum, digital signature, or backup. Data integrity can help to protect the data from unauthorized or accidental modification, deletion, or corruption that may affect the value, meaning, or usability of the data. However, data integrity does not prevent or detect unauthorized or malicious access to the system or network, as it only protects the data, not the user or system. References = CRISC Review Manual, pages 164-1651; CRISC Review Questions, Answers &Explanations Manual, page 952; What is Authentication? - Definition from Techopedia3; What is a Firewall? - Definition from Techopedia4

The most important element of an organization’s risk register to update following the commissioning of a new financial reporting system is the risk rating of affected financial processes. A risk rating is a measure of the level and nature of the risk exposure, based on the impact and likelihood of the risk events. A risk rating can help to prioritize and respond to the risks, and to monitor and report the risk status. A new financial reporting system may introduce new or different risks, or change the existing risks, that could affect the financial processes of the organization, such as data quality, accuracy, timeliness, compliance, or security. Therefore, the risk rating of affected financial processes should be updated to reflect the current risk situation and to ensure that the risk register is accurate and complete. Key risk indicators (KRIs), the owner of the financial reporting process, and the list of relevant financial controls are not asimportant as the risk rating of affected financial processes, as they are not directly affected by the commissioning of a new financial reporting system, and they do not measure the risk exposure and impact of the financial processes. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 48.

The best way to ensure that identified risk scenarios are addressed is to review the implementation of the risk response. The risk response is the action or plan that is taken to reduce, avoid, transfer, or accept the risk, depending on the chosen risk treatment option1. Reviewing the implementation of the risk response means checking whether the risk response actions are executed as planned, whether they are effective and efficient in mitigating the risk, and whether they are aligned with the organization’s objectives and risk appetite2. Reviewing the implementation of the risk response helps to monitor and control the risk, identify any gaps or issues, and make any necessary adjustments or improvements. The other options are not the best ways to ensure that identified risk scenarios are addressed, as they are either less comprehensive or less specific than reviewing the implementation of the risk response. Creating a separate risk register for key business units is a way of documenting and tracking the risks that affect different parts of the organization. However, this is not the same as addressing the risk scenarios, as it does not indicate how the risks are treated or resolved. Performing real-time monitoring of threats is a way of detecting and responding to any changes or events that may increase the likelihood or impact of the risks. However, this is not the same as addressing theriskscenarios, as it does not measure the effectiveness or efficiency of the risk response actions. Performing regular risk control self-assessments is a way of evaluating and testing the design and operation of the controls that are implemented to mitigate the risks. However, this is not the same as addressing the risk scenarios, as it does not cover the other aspects of the risk response, such as risk avoidance, transfer, or acceptance. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.1.7, Page 59.

The best way to provide assurance of the effectiveness of vendor security controls is to require independent control assessments. Independent control assessments are evaluations of thevendor’s security controls by a third-party auditor or assessor, such as an external auditor, a certification body, or a testing laboratory. Independent control assessments provide an objective and unbiased opinion on the adequacy and performance of the vendor’s security controls, as well as the compliance with relevant standards and regulations. Independent control assessments can also provide evidence and assurance to the customers of the vendor’s security posture and capabilities. Reviewing vendor control self-assessments (CSA), vendor service level agreement(SLA) metrics, or vendor references from existing customers are not as reliable or credible as independent control assessments, because they may be biased, incomplete, or outdated.

•External sources of emerging threats are sources that provide information about the latest cyberattacks, hacking techniques, malware, and vulnerabilities that can affect an organization’s IT systems and data. Examples of external sources are security blogs, forums, newsletters, reports, and alerts from reputable organizations such as ISACA, Imperva, Aura, and BitSight123.

•The most useful information an organization can obtain from external sources is the indicators for detecting the presence of threats. Indicators are observable signs or patterns that can help identify, prevent, or mitigate cyberattacks. Examples of indicators are IP addresses, domain names, file hashes, network traffic, system logs, and user behavior4.

•Indicators for detecting the presence of threats are more useful than the other options because they can help an organization to:

oMonitor and analyze its IT environment for any suspicious or malicious activity

oRespond quickly and effectively to any potential or actual incidents

oReduce the impact and damage of cyberattacks

oImprove its security posture and resilience

•Solutions for eradicating emerging threats are not the most useful information because they may not be applicable or effective for every organization, depending on its specific context, needs,and resources. Moreover, solutions may not be available or known for some new or sophisticated threats.

•Cost to mitigate the risk resulting from threats is not the most useful information because it does not help an organization to identify or prevent cyberattacks. Cost is only one factor to consider when deciding how to manage IT risk, and it may not reflect the true value or impact of the threats.

•Source and identity of attackers are not the most useful information because they may not be relevant or accurate for every organization. Source and identity of attackers are often difficult to trace or verify, and they may not affect the organization’s risk level or response strategy.

References =

•Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, Chapter 2: IT Risk Assessment, Section 2.3: Risk Identification, pp. 83-84

•Risk and Information Systems Control Review Questions, Answers & Explanations Database, 12 Month Subscription, ISACA, 2020, Question ID: 100000

Risk treatment options are the actions or plans that are implemented to modify or reduce the risk exposure of the organization. Risk treatment options receive adequate funding when the organization allocatessufficient resources and budget to support the risk response actions, and to ensure that the risk controls are effective and efficient. This is the best evidence that risk management is driving business decisions in the organization, as it shows that the organizationprioritizes and values the risk management process, and that it aligns its risk strategy and objectives with its business goals and value creation. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 245. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 245. CRISC Sample Questions 2024, Question 245.

Obfuscating customer information ensures data privacy by rendering sensitive details unintelligible to unauthorized parties, reducing the risk of exposure during transit or processing. This aligns withData Protection and Privacy Regulationsunder risk management frameworks, emphasizing safeguarding personally identifiable information.

The type of risk that is most likely to materialize as a result of allowing several employees to retire early in order to avoid layoffs is institutional knowledge loss, as it represents the loss of valuable information, experience, and expertise that the employees have accumulated over time, and that may not be easily transferred or replaced. Confidentiality breach, intellectual property loss, and unauthorized access are not the most likely types of risk, as they are more related to the security, ownership, or access of information, respectively, rather than the retention or transfer of knowledge. References = CRISC Review Manual, 7th Edition, page 100.

IT control self-assessments are techniques that involve identifying and evaluating the effectiveness and efficiency of the IT controls that are designed and implemented to mitigate the IT risks, by the managers and staff within the organization12.

An ineffective control is a control that does not achieve its intended objective or purpose, or does not operate as designed or expected34.

A low residual risk scenario is a situation or occurrence that has a low likelihood and impact of affecting the organization’s objectives, performance, or value creation, after considering the existing controls and their effectiveness56.

The next course of action when reviewing management’s IT control self-assessments and noting an ineffective control that links to several low residual risk scenarios is to recommend management accept the low-risk scenarios, which is a risk response strategy that involves acknowledging and tolerating the level of risk exposure, and not taking any further action to reduce or eliminate it78.

Recommending management accept the low-risk scenarios is the next course of action because it is the most cost-effective and reasonable option, given that the level of risk exposure is low andacceptable, and the cost and effort of implementing or improving the control may outweigh the potential benefits or value78.

Recommending management accept the low-risk scenarios is also the next course of action because it is consistent with the risk management process and objectives, which are to identifyand address the risks that may affect the achievement of the organization’s goals and the delivery of value to the stakeholders, and to optimize the balance between risk and reward78.

The other options are not the next course of action, but rather possible alternatives or steps that may be considered or followed in different circumstances or scenarios. For example:

Assessing management’s risk tolerance is a step that involves determining and communicating the acceptable or tolerable level of risk exposure for the organization or its business units, based on the organization’s risk appetite, criteria, and objectives78. However, this stepis not the next course of action because it is usually done before or during the risk assessment process, and not after noting an ineffective control that links to several low residual risk scenarios78.

Proposing mitigating controls is a course of action that involves suggesting or recommending additional or alternative controls that can reduce or eliminate the level of risk exposure, and improve the effectiveness and efficiency of the risk management process78. However, this course of action is not the next course of action because it is not necessary or appropriate for low residual risk scenarios, as the cost and effort of implementing or improving the controls may outweigh the potential benefits or value78.

Re-evaluating the risk scenarios associated with the control is a course of action that involves revising and updating the likelihood and impact of the risk scenarios, and the level of risk exposure or tolerance for the organization, based on the current or changed conditions or factors that influence the risk landscape78. However, this course of action is not the next course of action because it is not required or relevant for low residual risk scenarios, as the level of risk exposure is already low and acceptable, and the ineffective control does not significantly affect the risk assessment78. References =

1: Control Self Assessments - PwC1

2: Control self-assessment - Wikipedia2

3: Ineffective Controls: What They Are and How to Identify Them3

4: Ineffective Controls: What They Are and How to Identify Them4

5: Residual Risk - Definition and Examples5

6: Residual Risk: Definition, Formula & Management6

7: Risk IT Framework, ISACA, 2009

8: IT Risk Management Framework, University of Toronto, 2017

 The business owner is the person who is responsible for approval when a change in an application system is ready for release to production. The business owner is the person who has the authority and accountability for the business process or function that is supported by the application system. The business owner should approve the change to ensure that it meets the business requirements, objectives, and expectations, and that it does not introduce any adverse impacts or risks to the business operations. The information security officer, the IT risk manager, and the chief risk officer (CRO) are not responsible for the approval of the change, although they may provide input, feedback, or oversight. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.4.1, page 3-32.

According to the CRISC Review Manual (Digital Version), the primary reason a risk practitioner would be interested in an internal audit report is to evaluate the maturity of the risk management process, as it provides an independent and objective assessment of the effectiveness and efficiency of the risk management activities and controls. An internal audit report helps to:

Identify and evaluate the strengths and weaknesses of the risk management process and its alignment with the organization’s objectives and strategy

Detect and report any gaps, errors, or deficiencies in the risk identification, assessment, response, and monitoring processes and controls

Recommend and implement corrective actions or improvement measures to address the issues or findings in the risk management process

Communicate and coordinate the audit results and recommendations with the relevant stakeholders, such as the risk owners, the senior management, and the board

Enhance the accountability and transparency of the risk management process and its outcomes

References = CRISC Review Manual (Digital Version), Chapter 4: IT Risk Monitoring and Reporting, Section 4.2: IT Risk Reporting, pp. 223-2241

A KRI is a measure used by an organization to measure the health of a particular risk. In this case, the risk practitioner is developing a metric to measure the risk associated with security threats that were not identified by antivirus software12.

References

1Standardized Scoring for Security and Risk Metrics - ISACA

2Key Performance Indicators for Security Governance, Part 1 - ISACA

Risk tolerance refers to the acceptable level of variation in outcomes related to specific risks that an organization is willing to withstand. It defines the boundaries within which the organization can operate safely and is often set by senior leadership to guide decision-making processes. In the context of integrating a new acquisition, allowing for variation in the level of risk-taking directly pertains to the organization's risk tolerance.

The data custodian is the person who is responsible for implementing and maintaining security controls to protect the data entrusted to them by the data owner. The data custodian is typically a system administrator or a security systems administrator who has the technical skills and access rights to manage the security systems and processes that safeguard the data. The data custodian’s responsibilities include, but are not limited to: Installing, configuring, and updating security systems such as firewalls, anti-virus software, encryption tools, etc. Monitoring network trafficand system logs to detect and respond to security incidents. Conducting regular security assessments and audits to ensure compliance with security policies and standards. Implementing backup and recovery procedures to ensure data availability and integrity. The data custodian works under the direction and guidance of the data owner, who is the person who has the authority and accountability for the data and its use. The data owner defines the data classification, the data retention period, and the data access rights and privileges. The data owner also approves any changes to the security controls or the data itself. The data owner is typically a senior manager or a business unit leader who has the business knowledge and responsibility for the data. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.3: Data Classification, pp. 11-131

The most effective approach to prioritize risk scenarios is by assessing the impact to the strategic plan, because this will help to align the risk management process with the organization’s vision, mission, and goals. The strategic plan is the document that defines the organization’s direction, priorities, and objectives, and guides the allocation of resources and efforts. By assessing theimpact to the strategic plan, the organization can determine which risk scenarios pose the greatest threat or opportunity to the achievement of the strategic objectives, and prioritize them accordingly. The other options are not as effective as assessing the impact to the strategic plan, because they do not directly relate to the organization’s specific context, needs, and expectations, as explained below:

B. Aligning with industry best practices is an approach that involves following the standards, norms, and expectations for risk management that are established and followed by the peers or competitors in the same industry or sector. Aligning with industry best practices can help to benchmark and compare the organization’s risk management performance and maturity, and identify areas for improvement or innovation. However, this approach is not as effective as assessing the impact to the strategic plan, because it does not account for the organization’s unique and customized risk scenarios, which may differ from the industry average or standard.

C. Soliciting input from risk management experts is an approach that involves seeking advice, guidance, or feedback from the professionals or specialists who have the knowledge, experience, or skills in risk management. Soliciting input from risk management experts can help to enhance the quality and validity of the risk analysis and evaluation, and provide insights and recommendations for risk mitigation. However, this approach is not as effective as assessing the impact to the strategic plan, because it does not reflect the organization’s risk appetite, preferences, and expectations, which may differ from the risk management experts’ opinions or perspectives.

D. Evaluating the cost of risk response is an approach that involves estimating the resources and efforts required to implement the risk response strategies, such as avoiding, reducing, transferring, or accepting the risk. Evaluating the cost of risk response can help to optimize the risk management efficiency and effectiveness, and balance the potential benefits and costs of taking risks. However, this approach is not as effective as assessing the impact to the strategic plan, because it does not consider the potential consequences and outcomes of the risk scenarios, which may affect the organization’s performance and reputation. References = Risk and Information Systems Control Study Manual, Chapter 2, Section 2.3.1, page 45. The Ultimate Guide to Risk Prioritization - Hyperproof, Risk Prioritization: What Is It? [2021 Guide & Matrix] - ERM Software, What is Risk Prioritization | Centraleyes, Scenario Planning in Risk Management: Why It is Needed - SmartCompliance

The first step in assessing the current risk level of data loss is to identify where the sensitive data is stored, such as servers, databases, laptops, mobile devices, etc. This will help to determine the scope and boundaries of the risk assessment, as well as the potential exposure and impact of data loss. Identifying staff members who have access to the data, risk scenarios and owners, and existing controls are important steps, but they should be done after identifying the data locations. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.1.1.1, page 51.

When prioritizing risk treatment plans under budget constraints, the focus should be onresidual risk relative to appetite and tolerance. This ensures that resources are allocated to risks that exceed the organization’s risk appetite, aligning treatment efforts with strategic objectives and minimizing critical exposure.

A private cloud is a type of cloud computing deployment that provides the consumer exclusive access to a pool of computing resources that are owned, managed, and operated by the consumer or a third-party provider on behalf of the consumer.

A private cloud provides the consumer the greatest degree of control over the environment, because the consumer can customize and configure the resources according to their specific needs and preferences, and can apply their own security and governance policies and standards.

The other options are not the types of cloud computing deployment that provide the consumer the greatest degree of control over the environment. They are either shared or limited by the provider’s settings and rules.

The references for this answer are:

Risk IT Framework, page 23

Information Technology & Security, page 17

Risk Scenarios Starter Pack, page 15

KRIs provide measurable indicators that flag when risks exceed predefined thresholds, enabling swift and effective risk response. This supports theMonitoring and Reportingfunction in risk management, ensuring risks are managed proactively.

Comparing risk rating against appetite is the most helpful criterion when prioritizing action plans for identified risk, as it helps to determine the urgency and importance of addressing the risk. Risk rating is the level of risk after considering the likelihood and impact of a risk event, and risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. By comparing risk rating against appetite, an organization can identify which risks are above, within, or below its tolerance level, and prioritize the action plans accordingly. Risks that are above the appetite level should be treated with the highest priority, as they pose asignificant threat to the organization’s objectives and performance. Risks that are within the appetite level should be monitored and controlled regularly, as they are acceptable but still require attention. Risks that are below the appetite level should be reviewed periodically, as they are negligible or insignificant.

The best way to protect company sensitive information from being exposed when an organization allows employee use of social media accounts for work purposes is to require employees to sign nondisclosure agreements. Nondisclosure agreements are legal contracts that prohibit the employees from disclosing or sharing the company sensitive information with unauthorized parties, such as competitors, media, or regulators. Nondisclosure agreements also specify the scope, duration, and conditions of the nondisclosure obligation, and the penalties or remedies for breaching the agreement. Requiring employees to sign nondisclosure agreements is the best way to protect company sensitive information, as it helps to prevent or deter the employees from exposing or leaking the company sensitive information on social media, and to hold the employees accountable and liable for their actions. Requiring employees to signnondisclosure agreements also helps to comply with the legal and regulatory requirements for data protection and privacy. Educating employees on what needs to be kept confidential, implementing a data loss prevention (DLP) solution, and taking punitive action against employees who expose confidential data are also useful ways, but they are not as effective as requiring employees to sign nondisclosure agreements, as they are either dependent on the employees’ awareness or behavior, or reactive or corrective measures, rather than proactive or preventive measures. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 217.

The best way to justify the risk mitigation actions recommended in a risk assessment would be to focus on the business drivers, which are the factors that influence the organization’s objectives, performance, and value creation12.

Focusing on the business drivers means aligning the risk mitigation actions with the organization’s strategic goals, priorities, and values, and demonstrating how the actions will support or enhance the organization’s capabilities, opportunities, and competitive advantage12.

Focusing on the business drivers also means communicating the benefits, costs, and trade-offs of the risk mitigation actions to the relevant stakeholders, and showing how the actions will address the organization’s risk appetite, tolerance, and exposure12.

The other options are not the best way to justify the risk mitigation actions, but rather possible sources of information or guidance that may support the justification. For example:

Aligning with audit results is a way to validate the effectiveness and efficiency of the risk mitigation actions, and to identify any gaps or weaknesses that need improvement34. However, audit results may not reflect the organization’s current or future business drivers, and may not capture the full scope or impact of the risk mitigation actions34.

Benchmarking with competitor’s actions is a way to compare the organization’s risk mitigation actions with the best practices or standards of the industry or market, and to identify any areas of improvement or differentiation56. However, competitor’s actions may not be suitable or applicable for the organization’s specific context, needs, or challenges, and may not align with the organization’s business drivers56.

Referencing best practice is a way to adopt the proven or accepted methods or techniques for risk mitigation, and to ensure the quality and consistency of the risk mitigation actions78. However, best practice may not be the most optimal or innovative solution for the organization’s unique situation, and may not address the organization’s business drivers78. References =

1: Risk IT Framework, ISACA, 2009

2: IT Risk Management Framework, University of Toronto, 2017

3: IT Audit and Assurance Standards, ISACA, 2014

4: IT Audit and Assurance Guidelines, ISACA, 2014

5: Benchmarking IT Risk Management Practices, ISACA Journal, Volume 4, 2017

6: Benchmarking: A Tool for Improving IT Risk Management, ISACA Now Blog, March 27, 2017

7: IT Risk Management Best Practices, ISACA Journal, Volume 1, 2018

8: IT Risk Management Best Practices, ISACA Now Blog, January 9, 2018

Risk appetite is the amount and type of risk that an organization is willing to accept in order to achieve its objectives. Risk appetite reflects the organization’s risk attitude and its willingness to take on risk in specific scenarios. Risk appetite is usually expressed in a qualitative statement approved by the board of directors1.

Risk capacity is the maximum amount of risk that an organization can responsibly take on without jeopardizing its financial stability or other key objectives. Risk capacity is determined by objective factors like income, assets, liabilities, debts, insurance coverage, dependents, and time horizon. Risk capacity is usually expressed in a quantitative measure that sets the limit of how much risk the organization can handle2.

Prudent business practice requires that risk appetite not exceed risk capacity, because this would mean that the organization is taking on more risk than it can afford or sustain. If the risk appetiteis higher than the risk capacity, the organization may face serious consequences such as insolvency, bankruptcy, reputational damage, legal liability, or regulatory sanctions. Therefore, the organization should align its risk appetite with its risk capacity, and ensure that its risk exposure is within its risk tolerance3.

The other options are not correct. Inherent risk is the level of risk that exists in the absence of controls or mitigations. It is the natural level of risk inherent in a process or activity. Residual risk is the level of riskthat remains after the controls or mitigations have been applied. It is the remaining risk after the risk response has been implemented. Risk tolerance is the acceptable variation in the outcomes related to specific objectives or risks. It is the range of risk exposure that the organization is prepared to accept4. None of these concepts are directly comparable torisk appetite, and none of them represent the limit of how much risk the organization can take on. References =

Risk Appetite vs. Risk Tolerance: What is the Difference? - ISACA

What Is the Difference Between Risk Tolerance and Risk Capacity? - Investopedia

Risk Management: Understanding Risk Capacity, Appetite, and Tolerance - Consulting Edge

[CRISC Review Manual, 7th Edition]

 The areas to address first when classifying and prioritizing risk responses are those with high cost effectiveness ratios and high risk levels, as they represent the most optimal and urgent risk responses that can reduce the risk exposure and impact significantly with a reasonable cost. Theother options are not the areas to address first, as they may indicate suboptimal or less urgent risk responses that may not align with the risk tolerance and appetite of the organization. References = CRISC Review Manual, 7th Edition, page 109.

According to the CRISC Review Manual1, risk tolerance is the acceptable level of variation that management is willing to allow for any particular risk as it pursues its objectives. Risk tolerance provides a helpful reference point when communicating the results of a risk assessment to stakeholders, as it helps to compare the current level of risk exposure with the desired level of risk exposure, and to prioritize and allocate resources for risk response. Risk tolerance also helps to align the risk assessment results with the stakeholder expectations and preferences, and to facilitate risk-based decision making. References = CRISC Review Manual1, page 192.

An IT risk register is a document that records and tracks the IT risks that have been identified and assessed by the risk practitioner. It contains information such as the risk description, the risk owner, the risk level, the risk response, the risk status, and the risk monitoring and reporting activities. An IT risk register is a dynamic document that needs to be updated regularly to reflect the changes in the IT environment and the risk landscape. When a software upgrade renders an existing key control ineffective, the risk practitioner should update the IT risk register to indicate the new risk level, the new risk response, and the new risk monitoring and reporting activities. This will ensure that the IT risk register remains accurate, relevant, and useful for IT risk management. Updating the IT risk register is more important than updating the audit engagement letter, the risk profile, or the change control documentation, because the IT risk register is the primary source of information and guidance for managing IT risks. The audit engagement letter is a formal agreement between the auditor and the auditee that defines the scope, objectives, and terms of the audit. The risk profile is a summary of the organization’s risk appetite, risk tolerance, and risk exposure. The change control documentation is a record of the changes that have been made to the IT systems and processes. These documents are important for IT risk management, but they are not as critical as the IT risk register for updating when a key controlbecomes ineffective. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.4: Risk Register, pp. 69-711

A risk profile is a summary of the nature and level of risk that an organization faces. It includes information such as the sources, causes, and consequences of the risks, their likelihood and impact, their interrelationships and dependencies, and their alignment with the risk appetite and tolerance. A risk profile is influenced by various factors, such as the organization’s objectives, strategies, activities, processes, resources, capabilities, culture, etc. When defining a risk profile during the selection process for a new third party application, the stakeholder that is most important to include is the business process owner, who is the person who has the authority and responsibility for the design, execution, and performance of a business process. The business process owner can provide valuable input and insight into the requirements, expectations, and dependencies of the business process that will use the new third party application, and the potential risks and opportunities that may arise from the selection of the application. The business process owner can also help to prioritize and address the risks, and ensure that the risk profile is aligned with the business objectives and strategies. References = 5

When disposing of storage media, the best way to prevent the loss of highly sensitive data is physical destruction. Here’s why:

Physical Destruction:

Physical destruction involves destroying the storage media so that the data it contains cannot be recovered or reconstructed.

Methods include shredding, crushing, incinerating, or using industrial-grade degaussers that destroy the magnetic fields on the media.

Comparison with Other Methods:

Degaussing:This method erases data by disrupting the magnetic fields of the storage media. While effective for some types of media, it may not work on all (e.g., solid-state drives) and does not provide a visual confirmation that the data is irrecoverable.

Data Anonymization:This process involves altering data to prevent identification of individuals, but it does not destroy the data itself and is not applicable for disposing of storage media.

Data Deletion:Simply deleting data does not remove it permanently. Deleted data can often be recovered using specialized software unless it is overwritten multiple times, which is still less reliable than physical destruction.

Security Best Practices:

Physical destruction is considered the most secure method because it ensures that the media is rendered completely unusable and the data cannot be retrieved by any means.

This method is recommended by various standards and frameworks, including NIST Special Publication 800-88 Guidelines for Media Sanitization.

Risk culture is the foundation upon which ERM is built. It dictates how employees perceive, communicate, and act on risk. A strong risk culture ensures consistency in risk behaviors, supports governance, and sustains long-term effectiveness of the ERM.

The main purpose of reviewing a control after implementation is to validate that the control operates as intended, as this can help to ensure that the control is effective and efficient in mitigating the risk, and that it meets the control objectives and requirements. Reviewing a control after implementation can also help to identify and address any issues or gaps that may arise during the control operation, and to monitor and evaluate the performance and impact of the control. Reviewing a control after implementation can also provide feedback and information to the control owners and stakeholders, and enable them to adjust the control design and implementation accordingly. References = Most Asked CRISC Exam Questions andAnswers. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question254. ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 254. CRISC by Isaca Actual Free Exam Q&As, Question 9.

The best indicator of an effective IT security awareness program is the decreased success rate of internal phishing tests. Phishing is a type of social engineering attack that attempts to trick the users into revealing their personal or confidential information, or clicking on malicious links or attachments, by impersonating a legitimate entity or person. Internal phishing tests are simulated phishing attacks that are conducted by the enterprise to test the awareness and behavior of the employees in response to phishing emails. A decreased success rate of internal phishing tests means that fewer employees fall victim to the phishing attempts, and that they are more aware and vigilant of the phishing threats and techniques. A decreased success rate of internal phishing tests also implies that the IT security awareness program has effectively educated and trained the employees on how to recognize and report phishing emails, and how to protect themselves and the enterprise from phishing attacks. A decreased number of reported security incidents, a number of disciplinary actions issued for security violations, and a number of employees that complete security training are not as good indicators of an effective IT security awareness program as a decreased success rate of internal phishing tests, as they do not directly measure theawareness and behavior of the employees in relation to phishing, and may be influenced by otherfactors such as reporting mechanisms, enforcement policies, and training availability. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 220.

Obtaining a holistic view of IT strategy risk is the primary benefit of conducting a risk workshop using a top-down approach instead of a bottom-up approach, because it helps to identify and assess the risks that may affect the alignment and integration of IT with the organization’s objectives and strategy. A risk workshop is a collaborative and interactive method of conducting a risk assessment, where the risk practitioner facilitates a group discussion with the relevant stakeholders to identify, analyze, and evaluate the risks and their controls. A top-down approach is a method of conducting a risk workshop that starts from the high-level or strategic perspective, and then drills down to the lower-level or operational details. A bottom-up approach is a methodof conducting a risk workshop that starts from the low-level or operational details, and then aggregates them to the higher-level or strategic perspective. A top-down approach can offer a holistic view of IT strategy risk, as it helps to understand the big picture and the interrelationships of the risks and their impacts across the organization. A bottom-up approach can offer a detailed view of specific project or process risk, as it helps to capture the granular and technical aspects of the risks and their controls. Therefore, obtaining a holistic view of IT strategy risk is the primary benefit of using a top-down approach, as it supports the strategic alignment and integration of IT with the organization. Identifying specific project risk, understanding risk associated with complex processes, and incorporating subject matter expertise are all possible benefits of conducting a risk workshop, but they are not the primary benefit of using a top-down approach, as they are more suitable for a bottom-up approach. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.2.2, page 87

 Information security policies are the foundation of an organization’s security program, as they define the objectives, roles, responsibilities, and standards for protecting the information assets and systems. However, information security policies are not static, and they need to be reviewed and updated regularly to reflect the changes in the organization’s environment, risk profile, and compliance requirements. Therefore, the best course of action when conducting an organization-wide risk assessment is to review the policies against current needs to determine adequacy. This means comparing the policies with the current threats, vulnerabilities, controls, and best practices, and identifying any gaps or weaknesses that need to be addressed. The other options are not the best course of action, as they do not consider the current needs of the organization. Reviewing and updating the policies to align with industry standards may not be sufficient, as the organization may have specific or unique needs that are not covered by the standards. Determining that the policies should be updated annually may not be realistic, as the frequency of updates may depend on the nature and complexity of the policies and the organization. Reporting that the policies are adequate and do not need to be updated frequently may not be accurate, as the policies may be outdated or ineffective, and may expose the organization to unnecessary risks. References = Risk Assessment and Analysis Methods: Qualitative and Quantitative - ISACA, Does Your Organization Need a Security Risk Assessment? - ISACA, SP 800-39, Managing Information Security Risk: Organization, Mission …

A risk assessment indicates the residual risk associated with a new bring your own device (BYOD) program is within organizational risk tolerance. This means that the potential benefits of BYOD outweigh the potential risks, and that the controls in place are adequate to mitigate those risks.

The next step for the risk practitioner is to identify log sources to monitor BYOD usage and risk impact. Log sources are records of events or activities that occur in a system or network, such as file access, network traffic, user behavior, etc. Log sources can provide valuable information about how BYOD devices are used, what data they access, what applications they run, what threats they encounter, etc.

By monitoring log sources, the risk practitioner can track and measure the actual performance and security of BYOD devices, compare them with the expected outcomes and standards,identify any deviations or anomalies that may indicate a breach or a vulnerability, and take appropriate actions to address them.

Therefore, identifying log sources to monitor BYOD usage and risk impact is a recommended action after a successful risk assessment.

The references for this answer are:

Risk IT Framework, page 10

Information Technology & Security, page 4

Risk Scenarios Starter Pack, page 2

The MOST critical requirement to include in the contract is the confidentiality of customer data, because it is a legal and ethical obligation of the bank to protect the privacy and security of its customers’ personal and financial information. Outsourcing the statement printing function to an external service provider exposes the customer data to potential unauthorized access, disclosure, or misuse by the service provider or its sub-contractors. Therefore, the contract should specify the terms and conditions for the handling, storage, and disposal of the customer data, as well as the penalties for any breach of confidentiality. The other options are not as critical as the confidentiality of customer data, because:

Option A: Monitoring of service costs is an important requirement to ensure that the service provider delivers the statement printing function within the agreed budget and scope, but it is not as critical as the confidentiality of customer data, which has legal and reputational implications for the bank.

Option B: Provision of internal audit reports is a useful requirement to verify that the service provider complies with the internal and external standards and regulations for the statement printing function, but it is not as critical as the confidentiality of customer data, which is a core value of the bank and its customers.

Option C: Notification of sub-contracting arrangements is a relevant requirement to ensure that the service provider does not delegate the statement printing function to another party without the bank’s consent and oversight, but it is not as critical as the confidentiality of customer data, which is the primary responsibility of the bank and its service provider. References = Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, p. 197.

According to the CRISC Review Manual1, access controls are the policies, procedures, practices, and technologies that are designed and implemented to prevent unauthorized or inappropriate access to IT resources and data. Access controls are essential for ensuring the confidentiality, integrity, and availability of data, especially personally identifiable information (Pll), which is any information that can be used to identify, locate, or contact an individual. Insufficient access controls are the greatest concern related to data privacy when implementing an Internet of Things (loT) solution that collects Pll, as they can expose the data to various risks and threats, such asdata leakage, theft, loss, corruption, manipulation, or misuse. Insufficient access controls can also cause legal, regulatory, ethical, or reputational issues for the organization, if the data privacy rights and expectations of the individuals are violated or compromised. References = CRISC Review Manual1, page 240, 253.

Reviewing historical risk events is most useful for the risk assessment process within the risk management life cycle. Risk assessment is the process of identifying, analyzing, and evaluating the risks that may affect the project or the organization1. Reviewing historical risk events can help to:

Identify the sources, causes, and consequences of past risks and learn from the successes and failures of previous projects or organizations

Analyze the likelihood and impact of potential risks based on historical data and trends, and use statistical methods or models to estimate the probability and severity of risk scenarios

Evaluate the level of risk exposure and compare it with the risk appetite and tolerance of the project or the organization, and prioritize the risks that need further attention or action

Use historical risk events as inputs or examples for risk identification and analysis techniques, such as brainstorming, checklists, interviews, surveys, SWOT analysis, root cause analysis, or Monte Carlo simulation2

References = Risk and Information Systems Control Study Manual, Chapter 5: Risk Assessment Process3

The primary focus of a risk owner once a decision is made to mitigate a risk is to ensure that the control design reduces the risk to an acceptable level. This means that the risk owner shouldverify that the control objectives, specifications, and implementation are aligned with the risk mitigation plan, and that the control is effective in reducing the risk exposure to within the risk appetite and tolerance of the enterprise. The risk owner should also ensure that the control design is consistent with the enterprise’s policies, standards, and procedures, and that it complies with any relevant laws, regulations, or contractual obligations. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 4, Section 4.2.4, page 185.

While responsibility and accountability generally remain with the enterprise, financial impact (e.g., via insurance or outsourcing) can be transferred to a third party.

Establishing a code of conduct for employee behavior is the most important factor for managing ethical risk, because it defines the standards and expectations for ethical conduct and decision making within the organization, and provides guidance and direction for employees to act in a responsible and ethical manner. Ethical risk is the risk of violating the moral principles or values that govern the behavior and actions of individuals or organizations, such as honesty, integrity, fairness, or respect. A code of conduct is a document that outlines the ethical principles, values, and rules that the organization and its employees must follow, and the consequences of non-compliance. A code of conduct helps to promote a positive and ethical culture within the organization, and to prevent or mitigate the ethical risks that may arise from conflicts of interest, fraud, corruption, discrimination, or other misconduct. Involving senior management in resolving ethical disputes, developing metrics to trend reported ethics violations, and identifying the ethical concerns of each stakeholder are all useful factors for managing ethical risk, but they are not the most important factor, as they do not directly address the ethical conduct and decision making of employees. References = Risk and Information Systems Control Study Manual, Chapter 2, Section 2.5.1, page 67

The potential impact of events is the estimated magnitude and likelihood of the consequences that may result from a risk scenario. The potential impact of events can help key stakeholders understand the severity and urgency of the risk, and prioritize the appropriate response actions. The potential impact of events can be expressed in quantitative or qualitative terms, such as financial loss, operational disruption, reputational damage, legal liability, etc. The potential impact of events is the most important information to include when reporting on an increasing trend of ransomware attacks in the industry, as it can help stakeholders assess the level of risk exposure and the adequacy of the existing controls. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.3: Risk Analysis, p. 87-89.

Key performance indicators (KPIs) are metrics or measures that provide information on the progress and performance of an organization or a team toward an intended result orobjective. KPIs can help to monitor and evaluate the achievement of strategic, operational, or tactical goals, and to support the decision making and improvement of the organization or the team1.

Key control indicators (KCIs) are metrics or measures that provide information on the status and effectiveness of the controls or safeguards that are implemented to manage the risks or threats that an organization or a team faces. KCIs can help to identify and assess the strengths and weaknesses of the controls or safeguards, and to ensure the compliance and accountability of the organization or the team2.

The statement that best illustrates the relationship between KPIs and KCIs is that KPIs and KCIs both contribute to understanding of control effectiveness, because they can help to:

Measure and compare the actual and expected outcomes and impacts of the controls or safeguards, and to determine the gaps or deviations

Analyze and understand the causes and consequences of the gaps or deviations, and to identify the root problems or issues

Evaluate and report the performance and compliance of the controls or safeguards, and to communicate the results and feedback to the stakeholders

Improve and optimize the design and implementation of the controls or safeguards, and to enhance the efficiency and effectiveness of the risk management process34

The other statements do not illustrate the relationship between KPIs and KCIs accurately, but rather some of the differences or misconceptions between them. KPIs measure manual controls, while KCIs measure automated controls is a difference between KPIs and KCIs, but not a general one. KPIs and KCIs can measure both manual and automated controls, depending on the type and nature of the controls or safeguards.A robust KCI program will replace the need to measure KPIs is a misconception about KPIs and KCIs, as they are not mutually exclusive or substitutable. KPIs and KCIs complement and support each other, as they provide different but related information on the performance and risk management of the organization or the team. KCIs are applied at the operational level while KPIs are at the strategic level is a difference between KPIs and KCIs, but not a universal one. KPIs and KCIs can be applied at different levels of the organization or the team, depending on the scope and purpose of the measurement and evaluation. References =

Key Performance Indicator (KPI): Definition, Types, and Examples

Key Control Indicators - ISACA

Key Control Indicators: What They Are and How to Use Them

Key Performance Indicators vs. Key Control Indicators: What’s the Difference?

[CRISC Review Manual, 7th Edition]

Implementing multi-factor authentication (MFA) directly reduces the likelihood of unauthorized access by adding an extra layer of verification to remote network access. ISACA and CRISC materials emphasize that technical controls (e.g., MFA) meaningfully reduce the probability of threat scenarios involving remote access

Customizing the risk profile presentation ensures that stakeholders receive information in a format and context relevant to their roles. Tailored communication improves understanding, aligns risk discussions with decision-making needs, and ensures the stakeholders are equipped to act on the information effectively.

Comprehensive and Detailed Explanation From Exact Extract:

When a risk treatment plan does not reduce residual risk as expected, the immediate next step is to evaluate whether the current level of residual risk remains within the organization's defined risk appetite. If the residual risk is acceptable per the risk appetite, it may be tolerable without further mitigation. If it exceeds risk appetite, additional measures should be considered. Changing the risk assessment method is not a direct response to residual risk management. Acceptance should only occur if the risk is within tolerance levels【5:230, 5:231†CRISC_SentenceinNOTE30.pptx】.

The best time to conduct a risk analysis in a software development project is at each stage of the development life cycle. This is because risks can emerge or change at any point of the project, and they need to be identified, assessed, and managed as soon as possible. By conducting a risk analysis at each stage, the project team can ensure that the risks are aligned with the project objectives, scope, and deliverables, and that the appropriate risk responses are implemented and monitored. Conducting a risk analysis at each stage can also help to avoid or reduce the impact of potential issues, such as schedule delays, cost overruns, quality defects, and customer dissatisfaction. The other options are not the best time to conduct a risk analysis, although they may be useful or necessary depending on the project context and nature. Conducting a risk analysis during the business requirement definitions phase is important, but it is not sufficient, as the risks may change or evolve as the project progresses. Conducting a risk analysis before periodic steering committee meetings is a good practice, but it is not the only time to do so, as the risks may arise or escalate between the meetings. Conducting a risk analysis during the business case development is a part of the project initiation process, but it is not the most effective time, as the risks may not be fully known or understood at that stage. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2: Risk Identification, Section 2.1: Risk Identification Process, p. 79-80.

 The best way to support risk-based decisions by senior management would be to map findings to objectives, because this would help them understand how the identified risks affect theachievement of the organization’s goals and priorities. Mapping findings to objectives would also help senior management evaluate the trade-offs between different risk responses and allocate resources accordingly. By linking risks to objectives, the risk practitioner can communicate the value and impact of risk management in a clear and relevant way. References = Risk IT Framework, ISACA, 2022, p. 17

The process owner is the stakeholder who is responsible for the business process that will be supported by the new IT solution. The process owner has the best knowledge of the businessrequirements, objectives, and risks associated with the process. The process owner can provide the most relevant information for analyzing the risk associated with the new IT solution, such as the expected benefits, costs, performance, functionality, security, and compliance of the solution. The process owner can also help to identify and evaluate the potential impact and likelihood of the risk scenarios related to the new IT solution. The other stakeholders may have some information or insights, but they are not as directly involved or affected by the new IT solution as the process owner. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.3.1.1, pp. 58-59.

Data usage exceeding individual consent presents the greatest risk to the organization’s reputation, as it violates the privacy and trust of the customers and exposes the organization to legal and regulatory liabilities. Customers have the right to know and control how their personal data is collected, processed, and shared by the organization, and they expect the organization to respect their preferences and comply with the applicable laws and standards. If the organization uses the data for purposes beyond the scope of the consent, or without obtaining the consent in the first place, it may damage its reputation and lose its customers’ loyalty and confidence. Third-party software used for data analytics, revenue generated from data analytics, and use of a data analytics system are not inherently risky to the organization’s reputation, as long as they are transparent, secure, and ethical. References = Most Asked CRISC Exam Questions and Answers - The Knowledge Academy; ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 203.

 Business process owners would provide the most important input when identifying IT risk scenarios. IT risk scenarios are the situations or events that may affect the organization’s objectives, operations, or performance due to the use of information andtechnology1. Identifying IT risk scenarios means finding,recognizing, and describing the IT risks that the organization faces, as well as their sources, drivers, consequences, and responses2. Business process owners are the persons or entities who are responsible for the design, implementation, and operation of the business processes that support the organization’s goals and values3. Business process owners would provide the most important input when identifying IT risk scenarios, because they can:

Provide the context and perspective of the business objectives, strategies, and requirements that are affected or supported by the IT risks and controls;

Identify and prioritize the IT risks that are relevant and significant to their business processes, as well as the IT assets and resources that are involved or impacted by the IT risks;

Evaluate and communicate the likelihood and impact of the IT risks on their business processes, as well as the risk appetite and tolerance of their business units;

Suggest and implement the most suitable and effective IT risk response actions or measures to mitigate the IT risks, as well as monitor and report on the IT risk and control performance;

Align and integrate the IT risk management activities and outcomes with the business risk management framework, policies, and standards. The other options are not the most important roles for providing input when identifying IT risk scenarios, as they are either less relevant or less specific than business process owners. Information security managers are the persons or entities who are responsible for the planning, implementation, and maintenance of the information security measures and controls that protect the confidentiality, integrity, and availability of the organization’s data and systems4. Information security managers can provide input when identifying IT risk scenarios, because they can:

Provide the expertise and guidance on the information security risks and controls that are related to the use of information and technology;

Identify and assess the information security vulnerabilities and threats that may affect the organization’s data and systems, as well as the information security assets and resources that are involved or impacted by the information security risks;

Recommend and implement the most appropriate and effective information security risk response actions or measures to reduce or eliminate the information security risks, as well as monitor and report on the information security risk and control performance;

Align and integrate the information security risk management activities and outcomes with the information security framework, policies, and standards. However, information security managers are not the most important roles for providing input when identifying IT risk scenarios, because they may not have the full understanding or visibility of the business objectives, strategies, and requirements that are affected or supported by the IT risks and controls, or the risk appetite and tolerance of the business units. Internal auditors are the persons or entities who areresponsible for theindependent and objective assurance and consulting on the effectiveness and efficiency of the organization’s governance, risk management, and internal control system5. Internal auditors can provide input when identifying IT risk scenarios, because they can:

Provide the assurance and validation on the design and operation of the IT risks and controls that are related to the use of information and technology;

Identify and evaluate the IT risk and control gaps or deficiencies that may affect the organization’s objectives, operations, or performance, as well as the IT risk and control objectives and activities that are involved or impacted by the IT risk and control gaps or deficiencies;

Report and recommend improvements or enhancements to the IT risks and controls, as well as follow up and verify the implementation and effectiveness of the IT risk and control improvements or enhancements;

Align and integrate the IT risk and control assurance and consulting activities and outcomes with the internal audit framework, policies, and standards. However, internal auditors are not the most important roles for providing input when identifying IT risk scenarios, because they may not have the authority or responsibility to implement or operate the IT risks and controls, or to decide or prioritize the IT risk response actions or measures. Operational risk managers are the persons or entities who are responsible for the identification, analysis, evaluation, and treatment of the risks that arise from the failures or inadequacies of the organization’s people, processes, systems, or external events6. Operational risk managers can provide input when identifying IT risk scenarios, because they can:

Provide the oversight and coordination of the operational risk management activities and performance across the organization, including the IT risks and controls that are related to the use of information and technology;

Identify and prioritize the operational risks that are relevant and significant to the organization, as well as the operational assets and resources that are involved or impacted by the operational risks;

Evaluate and communicate the likelihood and impact of the operational risks on the organization, as well as the risk appetite and tolerance of the organization;

Suggest and implement the most suitable and effective operational risk response actions or measures to mitigate the operational risks, as well as monitor and report on the operational risk and control performance;

Align and integrate the operational risk management activities and outcomes with the operational risk management framework, policies, and standards. However, operational risk managers are not the most important roles for providing input when identifying IT risk scenarios, because they may not have the specific knowledge or expertise on the IT risks and controls that are related to the use of information and technology, or the context and perspective of the business processes that are affected or supported by the IT risks and controls. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 3, Section 3.1.1, Page 85.

Key risk indicators (KRIs) are metrics that measure the exposure to a given risk at a particular time. They can also provide early warning signs of a potential change in risk level. By monitoring KRIs, risk practitioners can assess how quickly an exposure to a specific risk can affect the organization and take appropriate actions.

References

•Risk management at the speed of business - PwC

•Risk velocity measures how fast an exposure can affect an organization | Business Insurance

Awareness training is the most likely control that failed in this scenario, as it is designed to educate employees on the proper handling and protection of sensitive data, and the consequences of violating the organizational policy. Awareness training can help to prevent or reduce the occurrence of human errors, such as inadvertently removing a file from the premises, that may result in data loss or breach. The other options are not the most likely controls that failed, as they are either not directly related to the scenario or not sufficient to prevent the incident. Background checks are used to verify the identity, qualifications, and trustworthiness of potential or current employees, but they do not ensure that employees will always follow the policy or avoidmistakes. User access is used to restrict the access to information systems or resources based on the identity, role, or credentials of the user, but it does not prevent the user from copying or removing the data once they have access. Policy management is used to create, communicate, and enforce the organizational policy, but it does not ensure that employees will understand orcomply with the policy. References = Sensitive Data Essentials – The Lifecycle Of A Sensitive File; Personal data breach examples | ICO; How do I prevent staff accidentally sending personal information … - GCIT; 10 Ways to Protect Sensitive Employee Information; My personal data has been lost after a breach, what are my rights …

 Residual risk is the risk that remains after applying controls to mitigate the inherent risk. Inherent risk is the risk that exists before considering the controls. Risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Risk tolerance is the acceptable level of variation from the risk appetite. Improvements in the design and implementation of a control will most likely result in an update to the residual risk, because they will reduce the likelihood and impact of the risk event, and therefore lower the risk exposure and value. By improving the design and implementation of a control, the organization can enhance the effectiveness and efficiency of the control, and ensure that it is aligned with the risk objectives, expectations, and outcomes. The improvement can also address any gaps, overlaps, redundancies, or conflicts among the controls, and any changes or enhancements that are needed to optimize the controls. The other options are less likely to be updated due to improvements in the design and implementation of a control. The inherent risk will not change, as it is based on the nature and value of the asset and the threats and vulnerabilities that exist. The risk appetite and the risk tolerance will also not change, as they are based on the organization’s culture, strategy, and stakeholder expectations. Therefore, the most likely factor to be updated is the residual risk, as it reflects the actual risk level that the organization faces after applying the controls. References = Risk IT Framework, ISACA, 2022, p. 131

Internal audit provides independent assurance to the board and senior management regarding the effectiveness of risk management program implementation, consistent withGovernance and Assurance Principles.

The most important consideration when sharing risk management updates with executive management is ensuring relevance to organizational goals. This means that the risk information presented should align with the strategic objectives and priorities of the organization, and demonstrate how risk management supports the achievement of those goals. Executive management is responsible for setting the direction and vision of the organization, and therefore needs to understand how risk management contributes to the value creation and protection of the organization. By ensuring relevance to organizational goals, risk management updates can help executive management make informed decisions, allocate resources, and communicate with stakeholders.

Some of the ways to ensure relevance to organizational goals are:

Linking risk management updates to the organization’s mission, vision, values, and strategy

Highlighting the key risks and opportunities that affect the organization’s performance and competitiveness

Providing clear and concise risk reports that focus on the most critical and material risks

Using a common risk language and framework that is understood by executive management

Providing actionable recommendations and solutions to address the identified risks

Aligning risk management updates with the organization’s reporting cycle and governance structure

References =

The Importance of Integrating Risk Management with Strategy

Four steps for managing risk at the CEO level

5 Key Principles of Successful Risk Management

Facilitating the exception process ensures that any deviations from the standard risk assessment procedures are formally documented, reviewed, and approved by appropriate governance bodies. This approach maintains the integrity of the risk management process while addressing the business unit manager's concerns.

Unavailability of critical IT systems poses the greatest risk to an organization’s operations during a major IT transformation, because it can disrupt the business continuity, productivity, and performance of the organization. Unavailability of critical IT systems can also cause financial, reputational, or legal damages to the organization, and affect the quality and delivery of products or services to the customers. The other options are not the greatest risks, although they may also pose some challenges or threats to the organization during a major IT transformation. Lack of robust awareness programs, infrequent risk assessments of key controls, and rapid changes in IT procedures are examples of management or process risks that can affect the planning, execution,or monitoring of the IT transformation, but they do not have the same impact or severity as the unavailability of critical IT systems. References = CRISC: Certified in Risk & Information Systems Control Sample Questions

Key risk indicators (KRIs) are metrics that provide information about the level of exposure to a specific risk or a group of risks.

The most important factor to the effective monitoring of KRIs is determining threshold levels. This means that the acceptable or unacceptable values or ranges of the KRIs are defined and agreed upon by the relevant stakeholders.

Determining threshold levels helps to evaluate the actual performance and impact of the risks, compare them with the risk appetite and tolerance of the organization, identify any deviations or breaches that may require attention or action, and report them to the appropriate parties for decision making or improvement actions.

The other options are not the most important factors to the effective monitoring of KRIs. They are either secondary or not essential for KRIs.

The references for this answer are:

Risk IT Framework, page 15

Information Technology & Security, page 9

Risk Scenarios Starter Pack, page 7

The most critical factor when designing controls is the involvement of the process owner, who is the person responsible for the performance and outcomes of a business process. The process owner has the best knowledge and understanding of the process objectives, activities, inputs,outputs, resources, and risks. The process owner can provide valuable input and feedback on the design of controls that are relevant, effective, efficient, and aligned with the process goals. The process owner can also ensure that the controls are implemented, monitored, and improved as needed. The involvement of the process owner can also increase the acceptance and ownership of the controls by the process participants and stakeholders. The other options are less critical when designing controls. The involvement of internal audit can provide assurance and advice on the adequacy and effectiveness of the controls, but internal audit is not responsible for the design or implementation of the controls. The quantitative impact of the risk can help to prioritize and justify the controls, but it is not sufficient to determine the appropriate type and level of controls. The identification of key risk indicators can help to monitor and measure the risk and the performance of the controls, but it is not the main driver of the control design. References = Risk IT Framework, ISACA, 2022, p. 181

Control Self-Assessments (CSAs)provide an efficient way for process owners and staff to assess control effectiveness continuously. ISACA recognizes CSAs as a proactive approach that encourages accountability and early detection of control weaknesses, reducing the need for frequent external testing.

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The greatest concern for a risk practitioner with the use of a vulnerability scanning tool is the inaccurate reporting of results. A vulnerability scanning tool is a software that scans the network or system for known vulnerabilities and generates a report of the findings. However, the tool may produce false positives (reporting vulnerabilities that do not exist) or false negatives (missing vulnerabilities that do exist). This can lead to incorrect risk assessment, ineffective risk response, and wasted resources. Increased time to remediate vulnerabilities, increased number of vulnerabilities, and network performance degradation are other possible concerns, but they are not as critical as the inaccurate reporting of results. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 7; CRISC Review Manual, 6th Edition, page 202.

A risk assessment of a production system is a process of identifying, analyzing, evaluating, and treating the risks that may affect the performance, quality, or safety of the production system, which is a system that transforms inputs into outputs using various resources, processes, and technologies12.

The most appropriate action for the risk manager to take after undertaking a risk assessment of a production system is to inform the process owner of the concerns and propose measures to reduce them, which is a process of communicating and consulting with the person who is responsible for the design, operation, and improvement of the production system, and suggesting possible risk responses that can prevent, mitigate, transfer, or accept the risks34.

This action is the most appropriate because it ensures the involvement and collaboration of the process owner, who has the authority and accountability to implement and monitor the risk responses, and who can provide feedback and input on the feasibility and effectiveness of the proposed measures34.

This action is also the most appropriate because it supports the risk management process and objectives, which are to identify and address the risks that may affect the achievement of the organization’s goals and the delivery of value to the stakeholders34.

The other options are not the most appropriate actions, but rather possible alternatives or supplements that may have some limitations or drawbacks. For example:

Recommending a program that minimizes the concerns of the production system is an action that involves designing and planning a set of coordinated and interrelated activities and tasks that aim to reduce the likelihood or impact of the risks34. However, this action is notthe most appropriate because it does not involve the process owner, who is the key stakeholder and decision maker for the production system, and who may have different views or preferences on the risk responses34.

Informing the development team of the concerns, and together formulating risk reduction measures is an action that involves communicating and consulting with the group of people who are responsible for creating, testing, and deploying the products or services that are produced by the production system, and jointly developing possible risk responses34. However, this action is not the most appropriate because it does not involvethe process owner, who is the primary owner and user of the production system, and who may have different needs or expectations on the risk responses34.

Informing the IT manager of the concerns and proposing measures to reduce them is an action that involves communicating and consulting with the person who is responsible for managing and overseeing the IT resources, processes, and systems that support the production system, and suggesting possible risk responses34. However, this action is not the most appropriate because it does not involve the process owner, who is the main stakeholder and beneficiary of the production system, and who may have different requirements or constraints on the risk responses34. References =

1: Risk Assessment for the Production Process1

2: Risk Assessment for Industrial Equipment2

3: Risk IT Framework, ISACA, 2009

4: IT Risk Management Framework, University of Toronto, 2017

Events exceeding risk thresholds are situations or occurrences that result in the actual level of risk exceeding the acceptable or tolerable level of risk, as defined by the organization’s risk appetite, criteria, and objectives12.

The most effective way to enable a business operations manager to identify events exceeding risk thresholds is to implement continuous monitoring, which is a process that involves collecting and analyzing data and information on the performance and status of the business processes, systems, and controls, and detecting and reporting any deviations, anomalies, or issues that may indicate a risk event34.

Continuous monitoring is the most effective way because it provides timely and accurate visibility and insight into the risk landscape, and enables the business operations manager to identify and respond to the events exceeding risk thresholds before they escalate or cause significant harm or damage to the organization34.

Continuous monitoring is also the most effective way because it supports the risk management process and objectives, which are to identify and address the risks that may affect the achievement of the organization’s goals and the delivery of value to the stakeholders34.

The other options are not the most effective ways, but rather possible tools or techniques that may complement or enhance the continuous monitoring. For example:

A control self-assessment is a technique that involves engaging and empowering the business process owners and operators to evaluate and report on the effectiveness and efficiency of the controls that are designed and implemented to mitigate the risks56. However, this technique is not the most effective way because it is periodic rather than continuous, and it may not capture or communicate the events exceeding risk thresholds in a timely or consistent manner56.

Transaction logging is a tool that involves recording and storing the details and history of the transactions or activities that are performed by the business processes or systems, and providing an audit trail for verification or investigation purposes78. However, this tool is not the most effective way because it is passive rather than active, and it may not detect or report the events exceeding risk thresholds unless they are analyzed or queried78.

Benchmarking against peers is a technique that involves comparing and contrasting the performance and practices of the business processes or systems with those of the similar or leading organizations in the same or related industry, and identifying the gaps or opportunities for improvement . However, this technique is not the most effective way because it is external rather than internal, and it may not reflect or align with the organization’s specific risk appetite, criteria, and objectives . References =

1: Risk IT Framework, ISACA, 2009

2: IT Risk Management Framework, University of Toronto, 2017

3: Continuous Monitoring - ISACA1

4: Continuous Monitoring: A New Approach to Risk Management - ISACA Journal2

5: Risk and control self-assessment - KPMG Global3

6: Control Self Assessments - PwC4

7: Transaction Log - Wikipedia5

8: Transaction Logging - IBM6

Benchmarking - Wikipedia7

Benchmarking: Definition, Types, Process, Advantages & Examples

The best thing to include when communicating changes in the IT risk profile is the gaps between the current and desired states of the control environment, as this shows the stakeholders the extent and impact of the changes, and the actions and resources needed to address them. The control environment is the set of policies, processes, and systems that provide reasonableassurance that the IT risks are identified, assessed, and treated effectively and efficiently. The current state of the control environment reflects the existing level and performance of the controls, and the residual risk that remains after the controls are applied. The desired state of the control environment reflects the target level and performance of the controls, and the risk appetite and tolerance of the organization. The gaps between the current and desired states of the control environment indicate the areas of improvement or enhancement for the IT risk management process, and the priorities and strategies for risk response. The other options are not the best things to include when communicating changes in the IT risk profile, although they may be useful or relevant information. A list of recent incidents affecting industry peers can provide some context and comparison for the IT risk profile, but it does not measure or explain the changes in the IT risk level or the control environment. Results of external attacks and related compensating controls can demonstrate the security and resilience of the IT systems and networks, but they do not cover the entire scope or spectrum of the IT risk profile or the control environment. A review of leading IT risk management practices within the industry can provide some insights and benchmarks for the IT risk management process, but it does not reflect thespecific situation or needs of the organization or the stakeholders. References = Risk and Information Systems Control Study Manual, Chapter 5: Risk and Control Monitoring and Reporting, page 181.

Risk response strategy is the approach that an organization takes to address the risks that it faces across its various functions, processes, and activities. Risk response strategy involves selecting and implementingthe appropriate risk response options, such as avoidance, mitigation, transfer, or acceptance, for each risk, based on the risk level, the risk appetite, and the cost-benefit analysis1.

The most important consideration for senior management when developing a risk response strategy is the risk appetite of the organization. Risk appetite is the amount and type of risk that an organization is willing to accept in order to achieve its objectives. Risk appetite reflects the organization’s risk attitude and its willingness to take on risk in specific scenarios. Risk appetite is usually expressed in a qualitative statement approved by the board of directors2.

Considering the risk appetite of the organization is essential for developing a risk response strategy, because it can help to:

Align the risk response strategy with the overall business strategy and vision, and ensure that the risk response options support the achievement of the organizational objectives

Balance the risk response strategy with the expected benefits and opportunities, and ensure that the risk response options do not eliminate or reduce the potential value or performance of the organization

Enhance the risk response strategy with the stakeholder expectations and requirements, and ensure that the risk response options meet the needs and interests of the customers, suppliers, partners, regulators, and other parties

Optimize the risk response strategy with the available resources and capabilities, and ensure that the risk response options are feasible and cost-effective for the organization34

The other options are not as important as the risk appetite of the organization for developing a risk response strategy, but rather some of the factors or outcomes of it. Cost of controls is the amount of resources and funds that are required to implement and maintain the risk response controls, such as policies, procedures, or technologies, that aim to prevent or reduce the negative effects of the risks. Cost of controls is a factor that can affect the selection and implementation of the risk response options, but it is not the primary consideration for developing the risk response strategy. Risk tolerance is the acceptable variation in the outcomes related to specific objectives or risks. Risk tolerance is a factor that can measure the risk analysis and guide the risk response, but it is not the primary consideration for developing the risk response strategy. Probability definition is the process of estimating the likelihood or frequency of the risk events, based on historical data, statistical analysis, expert judgment, or other methods. Probability definition is anoutcome of the risk analysis that can inform the risk response, but it is not the primary consideration for developing the risk response strategy. References =

Risk Response - ISACA

Risk Appetite vs. Risk Tolerance: What is the Difference? - ISACA

Risk Response Strategies: Types & Examples (+ Free Template)

Risk Response Strategy - ISACA

[CRISC Review Manual, 7th Edition]

The first course of action for a risk practitioner when discovering a deficiency in a critical system that cannot be patched is to conduct a risk assessment. A risk assessment is a process of identifying, analyzing, and evaluating the risks that could affect the achievement of the objectives of the system or the organization. A risk assessment helps to determine the level and nature of the risk exposure, and to prioritize and respond to the risks. Conducting a risk assessment is the first course of action, as it helps to understand the source, cause, and impact of the deficiency, and to estimate the likelihood and consequences of the risk events that could exploit the deficiency. Conducting a risk assessment also helps to identify and evaluate the existing or potential controls or mitigations that could address the deficiency, and to recommend the appropriate risk treatment options. Reporting the issue to internal audit, submitting a request to change management, and reviewing the business impact assessment are not the first courses ofaction, as they are either the outputs or the inputs of the risk assessment process, and they do not address the primary need of assessing the risk situation and status. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 49.

Risk culture encompasses the values, beliefs, and attitudes towards risk within an organization. It significantly influences how risk appetite is defined and communicated. Understanding the organization's risk culture ensures that the established risk appetite aligns with stakeholder expectations and supports effective risk management practices.

According to the CRISC Review Manual, a risk owner is the person who is accountable for the risk and its associated mitigation actions. The risk owner is responsible for monitoring the risk, reporting the risk status, and implementing the risk response. Therefore, the most appropriate risk owner would be the individual who is accountable for loss if the risk materializes, as it implies that they have the authority and the incentive to manage the risk effectively. The other options are not the most appropriate risk owners, as they are not directly accountable for the risk or its consequences. The person who is in charge of information security is responsible for overseeing the IT security function and ensuring that the IT security policy is enforced, but they may not have the authority or the resources to manage the risk. The person who is responsible for enterprise risk management (ERM) is responsible for establishing and maintaining the ERM framework and processes, but they may not have the knowledge or the involvement to manage the risk. The person who can implement remediation action plans is responsible for executing the risk response, but they may not have the decision-making power or the accountability to manage the risk. References = CRISC Review Manual, 7th Edition, Chapter 3, Section 3.1.2, page 108.

The most important objective of information security controls is to provide measurable risk reduction. Information security controls are the policies, procedures, techniques, or technologies that are implemented to protect the confidentiality, integrity, and availability of information assets. The main purpose of information security controls is to reduce the risk of unauthorized access, use, disclosure,modification, or destruction of information assets, and to ensure that the information assets support the enterprise’s objectives and performance. Information security controls should be measurable, meaning that they should have clear and quantifiable criteria for evaluating their effectiveness and efficiency in reducing the risk exposure to an acceptable level. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 3, Section 3.1.1, page 1151

The number of validated transactions is a critical indicator of a blockchain network's security. It reflects the network's ability to accurately and securely process transactions, ensuring data integrity and trustworthiness. A higher number of validated transactions indicates robust consensus mechanisms and effective security controls within the blockchain infrastructure.

The business application owner is accountable for business impact and must approve any change that affects application availability. ISACA’s CRISC emphasis on ownership roles indicates business owners should approve changes with risk implications.

 A deterrent control is a type of control that has been implemented by displaying a poster that reads “Anyone caught taking photographs in the data center may be subject to disciplinary action.”, as it aims to discourage or prevent unauthorized or malicious activities by warning the potential perpetrators of the consequences or sanctions. The other options are not the correct types of control, as they are more related to the correction, detection, or prevention of unauthorized or malicious activities, respectively, rather than the deterrence of unauthorized or malicious activities. References = CRISC Review Manual, 7th Edition, page 154.

A business continuity plan (BCP) is a system of prevention and recovery from potential threats to a company. The plan ensures that personnel and assets are protected and are able to function quickly in the event of a disaster1. The first task when developing a BCP should be to identify critical business functions and resources, because this will help to determine the scope, objectives, and priorities of the plan. Critical business functions and resources are those that are essential for the continuity of the company’s operations, and that would cause significant disruption or damage if they were interrupted or lost. By identifying critical business functions and resources, the company can focus its efforts and resources on protecting and restoring them, and minimizing the impact of a disaster. The other options are not the first task when developing a BCP, because they depend on the identification of critical business functions and resources, as explained below:

A. Determine data backup and recovery availability at an alternate site is a task that relates to the recovery strategy of the BCP, which aims to restore the data and information systems that support the critical business functions and resources. However, this task cannot be performed without first identifying which data and information systems are critical, and what level of availability and recovery they require.

C. Define roles and responsibilities for implementation is a task that relates to the organization and governance of the BCP, which aims to assign and communicate the duties and expectations of the personnel involved in the plan. However, this task cannot be performed without first identifying which personnel are critical, and what functions and resources they are responsible for.

D. Identify recovery time objectives (RTOs) for critical business applications is a task that relates to the analysis and evaluation of the BCP, which aims to measure the acceptable downtime and recovery speed of the critical business functions and resources. However, this task cannot be performed without first identifying which business applications are critical, and what impact and likelihood they have. References = Risk and Information Systems Control Study Manual, Chapter 4, Section 4.2.1, page 115. What Is a Business Continuity Plan (BCP), and How Does It Work?, Business continuity plan (BCP) in 8 steps, with templates | BDC.ca, How Develop a Business Continuity Plan - Invenio IT, Business Continuity Planning | Ready.gov, Develop a Robust Business Continuity Plan | Wrike

 The best method of creating risk awareness in an organization is to ensure senior management commitment to risk training. Senior management plays a vital role in setting the tone and direction of the risk culture and governance in the organization. By demonstrating their support and participation in risk training, they can influence and motivate the employees to follow the risk policies and procedures, and to enhance their risk knowledge and skills. Marking the risk register available to project stakeholders, providing regular communication to risk managers, and appointing the risk manager from the business units are other methods of creating risk awareness, but they are not as effective as ensuring senior management commitment to risk training. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 12; CRISC Review Manual, 6th Edition, page 215.

The primary input when designing IT controls should be internal and external risk reports. IT controls are specific activities performed by persons or systems to ensure that business objectives are met, and thatthe confidentiality, integrity, and availability of data and the overall management of the IT function are ensured1. Designing IT controls means creating and implementing the appropriate measures or actions to reduce the likelihood or impact of the IT risks that may affect the organization2. Internal and external risk reports are documents that provide information and analysis on the current and potential IT risks that the organization faces, as well as their sources, drivers, consequences, and responses3. Internal risk reports are generated by the organization itself, such as by the IT risk management function, the internal audit function, or the business units. External risk reports are obtained from external sources, such as regulators, industry associations, or third-party service providers. Internal and external risk reports are the primary input when designing IT controls, because they help to:

Identify and prioritize the IT risks that need to be addressed by the IT controls;

Evaluate the likelihood and impact of the IT risks, and compare them against the organization’s risk appetite and tolerance;

Determine the most suitable and effective IT control objectives and activities to mitigate the IT risks;

Align the IT control design and implementation with the organization’s objectives, strategies, and values;

Monitor and measure the performance and effectiveness of the IT controls in reducing the IT risks. The other options are not the primary input when designing IT controls, as they are either less relevant or less specific than internal and external risk reports. Benchmark of industry standards is a comparison of the organization’s IT control practices and performance with those of other organizations in the same industry or sector4. Benchmark of industry standards can help to improve the quality and consistency of the IT control design and implementation, as well as to identify the best practices and gaps. However, benchmark of industry standards is not the primary input when designing IT controls, as it does not address the specific IT risks that the organization faces, or the IT control objectives and activities that are appropriate and effective for the organization. Recommendations from IT risk experts are the suggestions or advice from the professionals or specialists who have the knowledge and experience in IT risk management and IT control design and implementation5. Recommendations from IT risk experts can help to enhance the IT control design and implementation, as well as to provide guidance and support to the organization. However, recommendations from IT risk experts are not the primary inputwhen designing IT controls, as they are based on the opinions and perceptions of the experts, and may not reflect the actual or objective level and nature of the IT risks, or the IT control objectives and activities that are suitable and efficient for the organization. Outcome of control self-assessments is the result or conclusion of the evaluation and testing of the design and operation of the existingIT controls by the organization itself, such as by the IT control owners, the IT risk management function, or the business units6. Outcome of control self-assessments can help to improve the IT control design and implementation, as well as to detect and correct any issues or deficiencies. However, outcome of control self-assessments is not the primary input when designing IT controls, as it does not cover the new or emerging IT risks that the organization may face, or the IT control objectives and activities that are relevant and necessary for the organization. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 4, Section 4.2.1, Page 189.

Artificial intelligence (AI) is a branch of computer science that aims to create machines or systems that can perform tasks that normally require human intelligence, such as learning, reasoning, decision making, etc.

An organization that is considering adopting AI should be aware of the potential risks and challenges that may arise from using AI, such as ethical, legal, social, technical, operational, or security issues.

The most important course of action for the risk practitioner is to identify applicable risk scenarios. This means that the risk practitioner should analyze the context and objectives of theAI adoption, the stakeholders and their expectations, the data and information sources and quality, the AI models and algorithms and their reliability, the AI outputs and outcomes and their impact, and the AI governance and oversight mechanisms and their effectiveness.

Identifying applicable risk scenarios helps to assess the likelihood and impact of the risks, prioritize the risks, design and implement appropriate risk responses, monitor and evaluate the risk performance, and report and communicate the risk status and issues.

The other options are not the most important courses of action for the risk practitioner. They are either secondary or not essential for AI risk management.

The references for this answer are:

Risk IT Framework, page 24

Information Technology & Security, page 18

Risk Scenarios Starter Pack, page 16

The management’s primary consideration when approving risk response action plans should be the changes in residual risk after implementing the plans. Residual risk is the level of risk that remains after the implementation of risk responses1. It indicates the degree of exposure or uncertainty that the organization still faces, and the potential impact or consequences of the risk events. The management should evaluate the effectiveness and adequacy of the risk responses, and decide whether the residual risk is acceptable or not2. The management should also compare the residual risk with the risk appetite, which is the amount and type of risk that the organization is willing to accept or pursue in order to achieve its objectives3. The management should ensure that the residual risk is aligned with the risk appetite, and that the risk responses are consistent and proportional to the risk level4.

The other options are not the primary consideration when approving risk response action plans, because:

Ability of the action plans to address multiple risk scenarios is a desirable but not essential criterion for approving risk response action plans. Risk scenarios are hypothetical situations that describe how a risk event could occur and what the consequences could be5. They can help to understand and communicate the nature and impact of the risks, and to design and evaluate the risk responses6. However, not all risk scenarios are equally likely or relevant, and some risk scenarios may be too complex or improbable to address. Therefore, the ability of the action plansto address multiple risk scenarios is not the primary consideration, but rather a secondary or supplementary one.

Ease of implementing the risk treatment solution is a practical but not critical criterion for approving risk response action plans. Risk treatment is the process of selecting and applying appropriate measures to modify the risk7. It can involve different strategies, such as avoid, reduce, transfer, or accept the risk8. The ease of implementing the risk treatment solution depends on various factors, such as the availability of resources, the feasibility of the solution, or the cooperation of the stakeholders. However, the ease of implementation is not the primary consideration, but rather a supporting or facilitating one.

Prioritization for implementing the action plans is a useful but not vital criterion for approving risk response action plans. Prioritization is the process of ranking the action plans according to their importance, urgency, or impact. It can help to allocate the resources, schedule the activities, and monitor the progress of the action plans. However, prioritization is not the primary consideration, but rather a subsequent or follow-up one.

References =

Residual Risk - CIO Wiki

What is Residual Risk? - Definition from Techopedia

Risk Appetite - CIO Wiki

Risk Appetite: What It Is and Why It Matters - Gartner

Risk Scenarios Toolkit - ISACA

Risk Scenarios Starter Pack - ISACA

Risk Treatment - CIO Wiki

Risk Treatment Plan - CIO Wiki

[Prioritization - CIO Wiki]

The primary risk management responsibility of the first line of defense is to implement risk treatment plans. The first line of defense is the operational management and staff who are directly involved in the execution of the business activities and processes. They are responsible for identifying, assessing, and responding to the risks that affect their objectives and performance. Implementing risk treatment plans means applying the appropriate risk response strategies and actions to address the identified risks, and monitoring and reporting the results and outcomes of the risk treatment. The other options are not as primary as implementing risk treatment plans, as they are related to the validation, establishment, or review of the risk management process, not the execution of the risk management process. References = Risk andInformation Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.1: IT Risk Management Process, page 15.

The issue of greatest concern when evaluating existing controls during a risk assessment is the presence of successive assessments with the same recurring vulnerabilities. This indicates that the controls are ineffective or inadequate in addressing the identified risks, and that the risk management process is not functioning properly. Recurring vulnerabilities expose the enterprise to potential losses, breaches, or incidents that could harm its objectives, reputation, or compliance. Therefore, it is essential to identify the root causes of the recurring vulnerabilities, implement corrective actions, and monitor the effectiveness ofthe controls on a regular basis. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 4, Section 4.2.2, page 183.

The best course of action when an audit reveals that there are changes in the environment that are not reflected in the risk profile is to review the risk identification process. This is because the risk identification process is the first step in the risk management process and it is responsible for identifying and assessing the potential risks that may affect the organization’s objectives. If the risk identification process is not effective, it may result in incomplete, inaccurate, or outdated risk profiles that do not reflect the current environment and the associated risks. Therefore, reviewing the risk identification process will help to ensure that the risk profile is updated and aligned with the changes in the environment and the organization’s strategy. References = Responding to Audit Findings

Key risk indicators (KRIs) are metrics that provide information on the level of exposure to a given risk. Key control indicators (KCIs) are metrics that measure the performance or effectiveness of a control in mitigating a risk. KCIs provide input for KRIs, because they help to assess the residual risk after applying the control. For example, if the KRI is the number of security incidents, and the KCI is the percentage of incidents detected by the intrusion prevention system (IPS), then the KCI provides input for the KRI by showing how well the IPS is reducing the risk of security breaches. References = CRISC: Certified in Risk & Information Systems Control Sample Questions

•A risk owner is the person or entity that has the authority and responsibility to manage a specific risk1. The risk owner is accountable for the implementation and effectiveness of the risk response strategy and the risk treatment plan2.

•Identifying the risk owner is the first step when a new risk scenario has been identified, because the risk owner is the key stakeholder who will be involved in the subsequent steps of the risk management process, such as risk analysis, risk evaluation, risk treatment, and risk monitoring2.

•Identifying the risk owner also helps to clarify the roles and responsibilities of different parties involved in the risk management process, such as the risk manager, the risk analyst, the risk committee, and the risk auditor3. This can improve the communication, coordination, and collaboration among the risk management team and ensure that the risk is managed effectively and efficiently.

•Estimating the residual risk (option A) is not the first step when a new risk scenario has been identified, because the residual risk is the risk that remains after the risk treatment plan has been implemented2. Therefore, estimating the residual risk requires prior steps such as risk analysis, risk evaluation, and risk treatment.

•Establishing key risk indicators (KRIs) (option B) is not the first step when a new risk scenario has been identified, because KRIs are metrics or data points that provide early warning signals or information about the level or trend of a risk4. Therefore, establishing KRIs requires prior steps such as risk identification, risk analysis, and risk evaluation.

•Designing control improvements (option C) is not the first step when a new risk scenario has been identified, because control improvements are part of the risk treatment plan, which is the set of actions and resources needed to implement the chosen risk response strategy2. Therefore,designing control improvements requires prior steps such as risk analysis, risk evaluation, and risk response selection.

References =

•Risk Owner - Institute of Internal Auditors

•Risk Treatment Plan - ISACA

•Risk Management Roles and Responsibilities - 360factors

•Key Risk Indicators: A Practical Guide | SafetyCulture

 The first step when developing a business case to drive the adoption of a risk remediation project by senior management is to identify the objectives of the project. The objectives are the specific, measurable, achievable, relevant, and time-bound (SMART) goals that the project aims to accomplish. The objectives should be aligned with the organization’s vision, mission, and strategy, as well as the identified business problem or opportunity. The objectives should also reflect the expected benefits and outcomes of the project, such as reducing the risk exposure, enhancing the security posture, or improving the business performance. Identifying the objectives is the first step because it provides the direction, scope, and justification for the project, and it serves as the basis for evaluating the alternative solutions, estimating the costs and benefits, and communicating the value proposition to the senior management and other stakeholders. The other options are not the first step, although they may be subsequent or concurrent steps in the business case development process. Calculating the cost is a part of the financial analysis, which estimates the total expenditure and funding sources of the project, but it does not define the purpose or the scope of the project. Analyzing cost-effectiveness is a part of the economic analysis, which compares the costs and benefits of the alternative solutions and recommends the optimal one, but it does not specify the goals or the criteria of the project. Determining the stakeholders is a part of the stakeholder analysis, which identifies and assesses the interests, expectations, and influence of the parties involved in or affected by the project, but it does not establish the objectives or the rationale of the project. References = Business case: 7 key steps to build it and use it - Twproject: project …, Guide to developing the Project Business Case - GOV.UK, How to Write a Business Case: Template & Examples | Adobe Workfront

An IT risk threat analysis is best used to establish risk scenarios. A risk scenario is a description of a possible event or situation that may affect the achievement of the IT objectives. A riskscenario consists of three elements: a threat, a vulnerability, and an impact. A threat is a potential cause of an unwanted incident. A vulnerability is a weakness or flaw that can be exploited by a threat. An impact is the consequence or effect of the incident on the IT objectives. An IT risk threat analysis is a technique that identifies and evaluates the threats that may pose a risk to the IT assets and processes. An IT risk threat analysis can help to establish risk scenarios by providing the information and context for the threat element of the risk scenario. The other options are not as directly related to an IT risk threat analysis, as they are related to the outcomes, measures, or responsibilities of the IT risk management process, not the inputs or sources of the IT risk scenarios. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.3: IT Risk Scenarios, page 23.

The most important outcome of reviewing the risk management process is assuring that the risk profile supports the IT objectives, because this ensures that the organization is managing its IT-related risks in alignment with its business goals and priorities. The risk profile is a summary of the key risks that the organization faces, their likelihood, impact, and response strategies. The IT objectives are the specific and measurable outcomes that the organization expects to achieve from its IT investments and activities. Byreviewing the risk management process, the organization can evaluate whether the risk profile is accurate, complete, and up-to-date, and whether the risk responses are effective, efficient, and consistent with the IT objectives. The review can also identify any gaps, issues, or opportunities for improvement in the risk management process, and provide recommendations for enhancing the process and its outcomes. The review can also help to communicate and report the value and performance of the risk management process to the senior management, the board of directors, and other stakeholders. References = Risk IT Framework, ISACA, 2022, p. 17

Data anonymization is the most important control to ensure the privacy of customer information when participating in an industry benchmarking study that involves providing customer transaction records for analysis. Data anonymization is the process of removing or modifying personally identifiable information (PII) from data sets, such as names, addresses, phone numbers, email addresses, etc., so that the data cannot be traced back to specific individuals.Data anonymization protects the confidentiality and privacy of customers, while still allowing for meaningful analysis and comparison of data. Nondisclosure agreements (NDAs), data cleansing, and data encryption are also useful controls, but they do not eliminate the risk of data breaches or unauthorized access to PII. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.3.1, page 3-21.

Unvalidated AI outputs pose considerable integrity and operational risks, potentially leading to erroneous decisions or compliance lapses. ISACA CRISC guidance underscores that ensuring results validity is a highest-priority control for new technologies such as AI.

A risk heat map is a kind of risk matrix where risks are ranked based on their potential impact and their likelihood of occurring, which allows you to prioritize the risks that pose the greatest threat. The severity of each risk is indicated by color, usually green for low risk, red for high risk, and yellow for medium risk. Therefore, from a single data point on a risk heat map, one can interpret the risk magnitude, which is the product of impact and likelihood. The other options are not directly related to a single data point on a risk heat map, but rather to the overall risk management strategy and context. References = Risk Assessment and Analysis Methods: Qualitative and Quantitative; What Is a Risk Heat Map, and How Can It Help Your Risk Management Strategy; CRISC Certified in Risk and Information Systems Control – Question599

IT risk scenarios are hypothetical situations that describe how IT-related risks can affect the organization’s objectives, operations, or assets1. IT risk scenarios help to make IT risk more concrete and tangible, and to enable proper risk analysis and assessment2. IT risk scenarios are developed after IT risks are identified, and are used as inputs for risk analysis, where the frequency and impact of the scenarios are estimated3.

The most important factor to the successful development of IT risk scenarios is threat and vulnerability analysis. Threat and vulnerability analysis is the process of identifying and evaluating the potential sources and causes of IT risks, such as malicious actors, natural disasters, human errors, or technical failures4. Threat and vulnerability analysis can help to:

Define the scope and boundaries of the IT risk scenarios, and ensure that they are relevant and realistic

Identify the critical assets, processes, or functions that are exposed or affected by the IT risks, and assess their value and importance to the organization

Determine the likelihood and methods of the threat events, and the existing or potential weaknesses or gaps in the IT control environment

Estimate the potential consequences and impacts of the IT risks, such as financial losses, operational disruptions, reputational damages, or compliance violations5

References = IT Scenario Analysis in Enterprise Risk Management - ISACA, IT Risk Scenarios - Morland-Austin, Threat and Vulnerability Analysis - Wikipedia, Threat and Vulnerability Analysis - ISACA

The maturity of an IT risk management program is most influenced by the organization’s risk culture, as this reflects the shared values, beliefs, and attitudes that shape how the organization perceives and responds to risk. The risk culture determines the level of awareness, commitment, and involvement of the stakeholders in the IT risk management process, as well as the degree of integration and alignment with the enterprise’s objectives and strategy. A mature IT risk management program requires a strong and positive risk culture that fosters trust, collaboration, and accountability among the stakeholders, and supports continuous improvement and learning. The other options are not the most influential factors for the maturity of an IT risk management program, although they may have some impact or relevance. Benchmarking results against similar organizations can provide useful insights and comparisons, but they do not necessarily reflect the organization’s own risk culture or context. Industry-specific regulatory requirements can impose certain standards and expectations, but they do not guarantee the effectiveness or efficiency of the IT risk management program. Expertise available within the IT department can enhance the technical and operational aspects of the IT risk management program, but it does not ensure the strategic and cultural alignment with the enterprise. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, page 23.

Project Delta should be deferred by management, as it has the lowest return on investment (ROI) among the four competing projects. ROI is a measure of the profitability or efficiency of a project, calculated by dividing the net benefits by the total costs. Project Delta has a net benefit of $100,000 and a total cost of $200,000, resulting in an ROI of 0.5. The other projects have higher ROIs: Project Alpha has an ROI of 1.0, Project Bravo has an ROI of 0.8, and Project Charlie has an ROI of 0.6. Therefore, Project Delta is the least attractive option for reducingoverall IT risk, and management should prioritize the other projects instead. References = How to Manage Project Risk: A 5-Step Guide; Matching the right projects with the right resources; Risk Types in Project Management

The percentage of unpatched IT assets is a KPI that measures the effectiveness of the IT asset management process in ensuring that the IT assets are updated with the latest security patches and are protected from vulnerabilities. This KPI reflects the compliance of the IT assets with the enterprise’s security policy and standards, and the ability of the IT asset management process to identify and remediate any gaps or risks in the IT asset inventory. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 5. CRISC by Isaca Actual Free Exam Q&As, Question 4. Most Asked CRISC Exam Questions and Answers, Question 10. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 4.

Changes to data sensitivity during the data life cycle present the greatest risk for a global organization when implementing a data classification policy, as they may result in data being under-protected or over-protected, leading to potential data breaches, compliance violations, or inefficiencies. Data sensitivity refers to the level of confidentiality, integrity, and availability that the data requires, and it may changedepending on the data’s creation, storage, processing,transmission, or disposal. A data classification policy should consider the changes to data sensitivity during the data life cycle and ensure that the appropriate controls and procedures are applied at each stage. Data encryption not applied to all sensitive data, many data assets that need to be classified, and changes to information handling procedures not documented are not the greatest risks, as they do not affect the data classification policy itself, but rather the implementation or execution of the policy. References = CRISC Certified in Risk and Information Systems Control – Question211; ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 211.

Comprehensive and Detailed Explanation From Exact Extract:

The identification of advanced persistent threats (APTs) is best supported by timely and relevant external information. Reviewing information from threat intelligence sources enables the organization to detect emerging threats quickly and accurately, reducing the mean time to identify APTs. While internal audits and KRIs are important, they typically focus on internal controls and risk monitoring rather than external threat detection. Thorough documentation of risk scenarios supports risk assessment but does not directly reduce detection time. Therefore, leveraging threat intelligence is the most effective approach for early identification of sophisticated threats.

 A control is a measure or action that is implemented to reduce the likelihood or impact of a risk event, or to enhance the benefits or opportunities of a risk event. A control owner is a person who is assigned the responsibility and authority for the design, implementation, operation, and maintenance of a control. The most appropriate person to be assigned ownership of a control is the individual accountable for monitoring control effectiveness, which is the process of measuring and evaluating the performance and compliance of the control. By assigning the control ownership to the individual accountable for monitoring control effectiveness, the organization can ensure that the control is aligned with the risk objectives, operates as intended, and delivers the expected results. References = 4

The first step when addressing the situation of moving the payroll system to a SaaS application and complying with the new data privacy regulation is to understand the data flows. This means identifying where the data is collected, stored, processed, and transferred, and who has access to it. Understanding the data flows can help to determine the scope and impact of the regulation, as well as the potential risks and gaps in the current state. It can also help to identify the roles and responsibilities of the organization and the SaaS provider regarding data protection and compliance. References = Risk and Information Systems Control Study Manual, Chapter 5, Section 5.3.1.2, p. 237-238

 The best method to identify unnecessary controls is reviewing system functionalities associated with business processes, because this can help to determine whether the controls are relevant, effective, and efficient for the current business needs and objectives. System functionalities are the capabilities and features of IT systems that support the execution and performance of business processes. Business processes are the set of interrelated activities that transform inputs into outputs to deliver value to customers or stakeholders. By reviewing system functionalities associated with business processes, an organization can assess whether the controls are aligned with the process requirements, expectations, and outcomes, and whether they add value or create waste. The review can also identify any gaps, overlaps, redundancies, or conflicts among the controls, and any changes or improvements that are needed to optimize the controls. The other options are less effective methods to identify unnecessary controls. Evaluating the impact of removing existing controls can help to measure the benefits and costs of the controls, but it does not address the root causes or sources of the unnecessary controls. Evaluating existing controls against audit requirements can help to ensure compliance and assurance, but it does not considerthe business context or purpose of the controls. Monitoring existing key risk indicators (KRIs) can help to measure the level and impact of risks, but it does not evaluate the suitability oradequacy of the controls. References = Surveying Staff to Identify Unnecessary Internal Controls - Methodology and Results 

A risk dashboard is a graphical tool that displays the key indicators and metrics of the organization’s IT risk profile, such as the risk level, status, trend, performance, etc., using charts, graphs, tables, etc. A risk dashboard can help the organization to monitor and communicate the IT risk profile, and to support the decision making and planning for the IT risk management.

A risk dashboard is the most effective tool in identifying trends in the IT risk profile, because it provides a visual and intuitive representation of the changes and variations in the IT risk profile over time, and highlights the most significant and relevant IT risks that need to be addressed or monitored. A risk dashboard can also help to compare and contrast the IT risk profile with the organization’s IT objectives and risk appetite, and to identify the gaps or opportunities for improvement.

The other options are not the most effective tools in identifying trends in the IT risk profile, because they do not provide the same level of visibility and clarity that a risk dashboard provides, and they may not be updated or aligned with the organization’s IT objectives and risk appetite.

A risk self-assessment is a process of identifying, analyzing, and evaluating the IT risks that may affect the organization’s objectives and operations, using the input and feedback from the individuals or groups that are involved or responsible for the IT activities or functions. A risk self-assessment can help the organization to understand and document the IT risk profile, and to align it with the organization’s IT strategy and culture, but it is not the most effective tool in identifying trends in the IT risk profile, because it may not reflect the current or accurate state and performance of the IT risk profile, and it may not cover all the relevant or emerging IT risks that may exist or arise.

A risk register is a document that records and tracks the information and status of the identified IT risks and their responses. It includes the IT risk description, category, source, cause, impact, probability, priority, response, owner, action plan, status, etc. A risk register can help the organization to identify, analyze, evaluate, and communicate the IT risks and their responses, and to align them with the organization’s IT strategy and culture, but it is not the most effective tool in identifying trends in the IT risk profile, because it may not provide a visual and intuitive representation of the changes and variations in the IT risk profile over time, and it may not highlight the most significant and relevant IT risks that need to be addressed or monitored.

A risk map is a graphical tool that displays the results of the IT risk analysis in a matrix format, using colors and symbols to indicate the level and priority of the IT risks. A risk map can show the distribution and comparison of the IT risks based on various criteria, such as likelihood, impact, category, source, etc. A risk map can help the organization to assess and prioritize the IT risks, and to design and implement appropriate controls or countermeasures to mitigate or prevent the IT risks, but it is not the most effective tool in identifying trends in the IT risk profile, because it may not provide a visual and intuitive representation of the changes and variations in the IT risk profile over time, and it may not reflect the organization’s IT objectives and risk appetite. References =

ISACA, CRISC Review Manual, 7th Edition, 2022, pp. 19-20, 23-24, 27-28, 31-32, 40-41, 47-48, 54-55, 58-59, 62-63

ISACA, CRISC Review Questions, Answers & Explanations Database, 2022, QID 180

CRISC Practice Quiz and Exam Prep

Performing risk prioritization would best help to improve the risk register, which is a document that records and summarizes the key information and data about the identified risks and the risk responses1. Risk prioritization is the process of ranking the risks according to their significance and urgency, based on their probability and impact2. By performing risk prioritization, the organization can:

Reduce the complexity and volume of the risk register, and focus on the most important and relevant risks that require immediate attention and action3.

Enhance the communication and understanding of the risks among the senior management and other stakeholders, and facilitate the decision-making and resource allocation for the risk responses4.

Improve the efficiency and effectiveness of the risk management process, and ensure that the risk register is aligned with the organization’s risk strategy, objectives, and appetite5.

The other options are not the best ways to improve the risk register, because:

Analyzing the residual risk components is not the best way, as it may not address the issue of the large volume of risk scenarios. Residual risk is the level of risk that remains after the implementation of risk responses6. Analyzing the residual risk components can help to measure the exposure or uncertainty of the assets, and to determine the need and extent of the risk responses. However, it may not reduce the complexity or volume of the risk register, as it may add more information or data to the risk register.

Validating the risk appetite level is not the best way, as it may not address the issue of the overwhelming risk scenarios. Risk appetite is the amount and type of risk that the organization is willing to accept or pursue in order to achieve its objectives7. Validating the risk appetite levelcan help to ensure that the risk register is consistent and proportional to the risk level, and that the risk responses are suitable and feasible. However, it may not reduce the complexity or volume of the risk register, as it may require more information or data to validate the risk appetite level.

Conducting a risk assessment is not the best way, as it may not address the issue of the existing risk scenarios. Risk assessment is the process of estimating the probability and impact of the risks, and prioritizing the risks based on their significance and urgency. Conducting a risk assessment can help to identify and analyze new or emerging risks, and to update or revise the risk register accordingly. However, it may not reduce the complexity or volume of the risk register, as it may introduce more information or data to the risk register.

References =

Risk Register - CIO Wiki

Risk Prioritization - CIO Wiki

Risk Prioritization: A Guide for Project Managers - ProjectManager.com

Risk Prioritization: How to Prioritize Risks in Project Management - Clarizen

Risk Prioritization: A Key Step in Risk Management - ISACA

Residual Risk - CIO Wiki

Risk Appetite - CIO Wiki

[Risk Assessment - CIO Wiki]

The organization’s risk appetite and tolerance are the most important topics to cover in a risk awareness training for senior management. Risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Risk tolerance is the level of variation from the risk appetite that the organization is prepared to accept. Senior management plays a key role in defining and communicating the risk appetite and tolerance, as well asensuring that they are aligned with the organization’s strategy, culture, and values. By covering these topics in the training session, the risk practitioner can help senior management understand and articulate the risk preferences and boundaries of the organization, as well as monitor andadjust them as needed. The other options are not the most important topics to cover in a risk awareness training for senior management, although they may be relevant and useful. The organization’s strategic risk management projects are specific initiatives or activities that aim to identify, assess, and treat risks that may affect the organization’s objectives. Senior management roles and responsibilities are the duties and expectations that senior management has in relation to risk management, such as providing leadership, oversight, and support. Senior management allocation of risk management resources is the process of assigning and prioritizing the human, financial, and technical resources that are needed to implement and maintain risk management activities. These topics are more operational and tactical than strategic and may vary depending on the context and scope of the risk management function. References = CRISC Review Manual, pages 40-411; CRISC Review Questions, Answers & Explanations Manual, page 732

 Risk appetite is the broad-based amount of risk that an organization is willing to accept in pursuit of its objectives. Risk appetite reflects the level of risk that the organization is prepared to take to achieve its strategic goals, and provides guidance and boundaries for the risk management activities and decisions. To define the risk management strategy, which is the plan and approach for managing the risks that may affect the achievement of the organization’s objectives, the factor that must be set by the board of directors is the risk appetite. The board of directors is the highest governing body of the organization, and has the ultimate responsibility and authority for setting the direction and oversight of the organization. By setting the risk appetite, the board of directors can communicate its expectations and preferences for the risk exposure and performance of the organization, and ensure alignment with the business objectives and strategies. References = 3

Risk assessment is a key process that identifies, analyzes, and evaluates the risks associated with the implementation of an emerging technology. It helps to determine the potential impact and likelihood of the risks, as well as the appropriate risk responses and controls. Lack of risk assessment can lead to poor decision making, inadequate risk mitigation, and unexpected consequences. Therefore, it should be of greatest concern to a risk practitioner reviewing the implementation of an emerging technology. References = Risk and Information Systems Control Study Manual, Chapter 5, Section 5.2.1, p. 226-227

It is most important that security controls for a new system be documented in the system requirements. The system requirements define the functional and non-functional specifications of the system, including the security controls that are needed to protect the system and its data. Documenting the security controls in the system requirements can help ensure that they are designed, developed, tested, and implemented as part of the system development life cycle. Testing requirements, the implementation plan, and the security policy are other documents that may include security controls, but they are not as important as the system requirements. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 5; CRISC Review Manual, 6th Edition, page 212.

Residual riskrepresents the amount of risk remaining after controls have been applied. Tracking its reduction over time directly indicates whether controls are effectively reducing risk to withintolerance limits.

Upon discovering that an IT control has failed, the risk practitioner's most important action is to review compensating controls. This involves assessing whether other existing controls can mitigate the risk associated with the failed control. Evaluating compensating controls helps determine the immediate impact of the control failure and guides decisions on necessary remediation steps.

The best way to facilitate the identification of appropriate key performance indicators (KPIs) for a risk management program is to evaluate KPIs in accordance with risk appetite. KPIs are metrics that measure the performance and effectiveness of the risk management program, and help monitor and report on the achievement of the risk objectives and outcomes. Risk appetite is the amount and type of risk that the organization is willing to accept or pursue in order to achieve its objectives. Evaluating KPIs in accordance with risk appetite helps to identify the appropriate KPIs, because it helps to align the KPIs with the organization’s mission, vision, values, and strategy, and to ensure that the KPIs reflect the organization’s risk tolerance and threshold. Evaluating KPIs in accordance with risk appetite also helps to communicate and coordinate the KPIs with the organization’s stakeholders, such as the board, management, and business units, and to facilitate the risk decision-making and reporting processes. The other options are not as effective as evaluating KPIs in accordance with risk appetite, although they may be part of or derived from the KPI identification process. Reviewing control objectives, aligning with industry best practices, and consulting risk owners are all activities that can help to define or refine the KPIs, but they are not the best way to facilitate the identification of appropriate KPIs. References = Risk and Information Systems Control Study Manual, Chapter 4, Section 4.5.1, page 4-38.

Tracking opened phishing emails provides a real-time behavioral indicator of how well employees follow security awareness and email policies. It is a leading metric of adherence and risk awareness.

Policies must reflect the actual structure and processes of the business to be enforceable and effective. Alignment ensures that policies are understood, applicable, and tailored to how the business operates.

As the threat landscape evolves, reporting on IT risk profile trends enables the organization tostay proactive. It helps ensure controls and strategies remain effective againstnew or increasing threats.

The impact to affected stakeholdersis the most critical factor when considering risks tied to re-identification. ISACA notes that risk is ultimately measured by how it affects stakeholders—including customers, partners, and regulators—particularly when personal data is involved.

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 Business Impact Assessment (BIA):

BIA identifies and evaluates the potential effects of interruptions to critical business operations. It helps determine the priority of risk mitigation efforts based on the potential impact on business functions.

BIA provides detailed information on which processes and systems are most critical to the organization's operations and their respective impact levels.

 Prioritizing Risk Mitigation:

The results of a BIA guide decision-makers in prioritizing which risks to address first based on their potential to disrupt critical business operations.

Risks that could cause significant operational, financial, or reputational damage are prioritized higher.

 Comparing Other Factors:

Cost of Risk Mitigation:Important but secondary to understanding the impact on business operations.

Asset Criticality:Relevant but typically part of the BIA process.

Acceptable Risk Level:Defines the threshold but does not prioritize specific risks.

 References:

The CRISC Review Manual discusses how BIA facilitates risk prioritization by identifying critical processes and their impacts (CRISC Review Manual, Chapter 2: IT Risk Assessment, Section 2.7 Business Impact Analysis)​​.

The main goal of the risk analysis process is to determine the frequency and magnitude of loss, because this will help to measure the level of risk exposure and the need for risk mitigation controls. Frequency refers to how often a risk event may occur, while magnitude refers to how much harm or damage a risk event may cause. By determining the frequency and magnitude of loss, the risk analysis process can quantify the impact and likelihood of the risks, and assign a risk rating and priority. The other options are not the main goal of the risk analysis process, because they are either inputs or outputs of the process, as explained below:

A. Potential severity of impact is an output of the risk analysis process, as it is the result of estimating the consequences of a risk event on the organization’s objectives, assets, or processes. The potential severity of impact is influenced by the magnitude of loss, but also by other factors, such as the timing, duration, and scope of the risk event.

C. Control deficiencies are an input of the risk analysis process, as they are the gaps or weaknesses in the existing controls that may increase the risk exposure or reduce the risk mitigation effectiveness. Control deficiencies are identified by comparing the current control environment with the desired control environment, and by evaluating the design and operation of the controls.

D. Threats and vulnerabilities are inputs of the risk analysis process, as they are the sources and causes of the risks that may affect the organization’s objectives, assets, or processes. Threats are external or internal factors that have the potential to exploit the vulnerabilities, while vulnerabilitiesare internal or external weaknesses that increase the susceptibility to the threats. References = Risk and Information Systems Control Study Manual, Chapter 2, Section 2.3.1, page 45. What is Risk Analysis? Process, Types, Examples & Methods, Risk Analysis Tutorial - The Process | solver, What is the goal of a risk assessment? - Creative Safety Supply

Risk tolerance defines the boundaries for acceptable risk levels and directly impacts decision-making for mitigation strategies. A well-defined tolerance helps prioritize actions and allocate resources effectively, emphasizing its central role in theRisk Responsedomain.

 When reporting risk assessment results to senior management, the most important information to include to enable risk-based decision making is the potential losses compared to treatment cost. This information helps to quantify the impact and likelihood of the risks, and to evaluate the cost and benefit of the risk responses. This information also helps to prioritize and allocate resources for the risk management program, and to align the risk management program with the enterprise’s objectives, strategy, and risk appetite. The other options are not as important as the potential losses compared to treatment cost, as they provide different types of information for the risk management process:

Risk action plans and associated owners are the documents that specify the actions to be taken to address the identified risks, the resources required, the timelines, the owners, and the expected outcomes. This information helps to implement and monitor the risk management program, and to assign the authority and accountability for the risk management activities.

Recent audit and self-assessment results are the outcomes of the independent and objective examination of the risk management program, such as by internal or external auditors, or by the risk owners or practitioners themselves. This information helps to provide assurance and feedback on the effectiveness and efficiency of the risk management program, and to identify the gaps or weaknesses that need to be addressed.

A list of assets exposed to the highest risk are the resources that have the most value for the enterprise, such as hardware, software, data, or services, and that are affected by or contribute to the highest risks. This information helps to identify and protect the critical assets of theenterprise, and to reduce the exposure and impact of the risks to the assets. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.3.1.1, pp. 58-59.

 A risk profile is a summary of the key risks that affect an organization, a business unit, a process, or a project. A risk profile can help stakeholders understand the current and potential exposure to various sources of uncertainty, and prioritize the risk response accordingly. Classification of risk profiles is the process of grouping and categorizing risks based on common characteristics, such as source, impact, likelihood, or response strategy. Classification of risk profiles can help communicate risk assessment results to stakeholders by providing a clear and consistent way of presenting and comparing risks across different domains, levels, or perspectives. Classification of risk profiles can also help identify patterns, trends, and interrelationships among risks, and facilitate the allocation of resources and responsibilities for risk management. References = Risk and Information Systems Control Study Manual, Chapter 4: Risk and Control Monitoring and Reporting, Section 4.1: Risk Profile, p. 193-195.

The effective implementation of a risk treatment plan is best indicated by managing residual risk within the organization’s appetite and tolerance levels. Residual risk is the remaining risk aftercontrols have been applied, and ensuring it is within acceptable levels demonstrates that the risk treatment plan is effective.

Managing Residual Risk within Appetite and Tolerance (Answer B):

Definition: Residual risk is the risk remaining after risk treatment measures have been implemented.

Significance: Managing residual risk within the set appetite and tolerance levels shows that the implemented controls are effective and aligned with the organization’s risk management objectives.

Outcome: It ensures that the organization's risk exposure is kept within acceptable boundaries, thereby protecting its assets and operations.

Comparison with Other Options:

A. Inherent risk is managed within an acceptable level:

Definition: Inherent risk is the risk before any controls are applied.

Limitation: The focus should be on residual risk post-treatment.

C. Risk treatments are aligned with industry peers:

Purpose: While benchmarking is useful, it does not directly indicate the effectiveness of risk treatment.

D. Key controls are identified and documented:

Purpose: Identifying and documenting controls is necessary, but effectiveness is shown by managing residual risk.

The proposed benefit that is most likely to influence senior management approval to reallocate budget for a new security initiative is the reduction in residual risk, as it indicates the expected value and outcome of the initiative in terms of reducing the risk exposure and impact to the level that is aligned with the risk tolerance and appetite of the organization. The other options are not the most likely benefits, as they may not reflect the actual or optimal risk reduction, or may not be relevant or measurable for the senior management, respectively. References = CRISC Review Manual, 7th Edition, page 111.

 The best control to minimize the risk associated with scope creep in software development is an established process for project change management. Scope creep is the uncontrolled expansion of the project scope due to changes in requirements, specifications, or expectations. A project change management process can help to prevent or reduce scope creep by defining the procedures for requesting, reviewing, approving, and implementing changes in the project. Retention of test data and results, business management review of functional requirements, and segregation between development, test, and production are other possible controls, but they are not as effective as a project change management process. References = ISACA Certified in Riskand Information Systems Control (CRISC) Certification Exam Question and Answers, question 11; CRISC Review Manual, 6th Edition, page 144.

Organizational risk culture is the term describing the values, beliefs, knowledge, attitudes and understanding about risk shared by a group of people with a common purpose. Organizationalrisk culture influences how the organization identifies, assesses, and manages risks, and how it aligns its risk appetite and tolerance with its objectives and strategies1.

The best indication of a mature organizational risk culture is that risk owners understand and accept accountability for risk, because it means that the organization:

Clearly defines and assigns the roles and responsibilities of the risk owners, who are the individuals or groups who have the authority and ability to manage the risks within their scope or domain

Empowers and supports the risk owners to perform their risk management duties, such as identifying, assessing, responding, monitoring, and reporting the risks

Holds the risk owners accountable for the outcomes and consequences of the risks, and evaluates their performance and compliance with the risk policies, standards, and procedures

Encourages and rewards the risk owners for demonstrating risk awareness and competence, and for contributing to the risk management improvement and learning23

The other options are not the best indications of a mature organizational risk culture, but rather some of the elements or aspects of it. Corporate risk appetite is the amount and type of risk that the organization is willing to accept in order to achieve its objectives. Corporate risk appetite is communicated to staff members to guide their risk decision making and behavior, and to ensure the consistency and alignment of the risk taking and tolerance across the organization. Risk policy is the document that establishes the principles, framework, and process for managing the risks within the organization. Risk policy is published and acknowledged by employees to ensure their awareness and compliance with the risk management expectations and requirements. Management is the group of individuals who have the authority and responsibility to direct and control the organization’s activities and resources. Management encourages the reporting of policy breaches to ensure the transparency and accountability of the risk management performance and outcomes, and to identify and address the risk management issues and gaps4. References =

Risk culture - Institute of Risk Management

Risk Owner - ISACA

Taking control of organizational risk culture | McKinsey

[CRISC Review Manual, 7th Edition]

 According to the CRISC Review Manual, formal approval of the account by the user’s manager is the best evidence that a user account has been properly authorized, because it ensures that the user’s role and access rights are consistent with the business needs and the principle of least privilege. The user’s manager is responsible for verifying the user’s identity, job function, and access requirements, and for approving or rejecting the account request. The other options are not the best evidence of proper authorization, because they do not involve the user’s manager’s approval. An email from the user accepting the account is a confirmation of the account creation, but it does not indicate that the account was authorized by the user’s manager. Notification from human resources that the account is active is an administrative process that does not verify the user’s access rights and role. User privileges matching the request form is a verification of the account configuration, but it does not ensure that the request form was approved by the user’s manager. References = CRISC Review Manual, 7th Edition, Chapter 4, Section 4.1.2, page 163.

Penetration test resultsprovide direct evidence of the vendor’s technical security posture and ability to defend against real-world attacks. This is more effective than reviewing contracts or benchmarking, which are indirect measures.

Automated asset management software is the best method to track asset inventory, as it can provide accurate, timely, and comprehensive information about the organization’s IT assets, such as their location, status, configuration, ownership, and value. Automated asset management software can also help to optimize the utilization, performance, and lifecycle of the IT assets, and to reduce the risks of loss, theft, damage, or obsolescence. Automated asset management software can integrate with other systems, such as configuration management database (CMDB), service desk, and security tools, to enable better visibility, control, and governance of the IT assets.

Well-developed, data-driven risk measurements should be focused on providing a forward-looking view, as they enable the organization to anticipate and prepare for the potential changes and impacts of the risk level and exposure, and to take proactive and appropriate actions toaddress the risk. The other options are not the characteristics of well-developed, data-driven risk measurements, as they may not reflect the strategic, comprehensive, or timely aspects of the risk measurements, respectively. References = CRISC Review Manual, 7th Edition, page 110.

Business Impact Analysis (BIA):

Purpose: A BIA is a systematic process to evaluate the potential effects of an interruption to critical business operations as a result of a disaster, accident, or emergency.

Identification of Consequences: It identifies critical resources and the consequences of their loss, allowing an organization to determine the operational and financial impacts of such losses.

Steps Involved in BIA:

Identify Critical Functions: Determine which business functions and processes are essential to the organization's operations.

Assess Impact: Evaluate the impact of losing these functions on the organization’s ability to operate.

Estimate Downtime Tolerance: Determine the maximum allowable downtime for critical functions before significant harm occurs.

Identify Dependencies: Document dependencies between systems, processes, and resources to understand how disruptions to one part affect the whole.

Comparison with Other Options:

Risk Management Action Plans: These are detailed plans developed to address identified risks but do not specifically focus on the impact of losing critical resources.

What-if Technique: This is a brainstorming technique used to explore potential risks and their impacts but is not as structured as a BIA.

Tabletop Exercise Results: These exercises simulate disaster scenarios to test response plans but do not provide the comprehensive impact analysis that a BIA does.

Best Practices:

Regular Updates: Regularly update the BIA to reflect changes in the business environment and operational dependencies.

Integration with DR/BC Plans: Ensure that findings from the BIA are integrated into disaster recovery (DR) and business continuity (BC) plans to enhance overall preparedness.

According to the What Is Risk Management & Why Is It Important? article, risk management is the systematic process of identifying, assessing, and mitigating threats or uncertainties that can affect your organization. The primary goal of a risk management program is to help ensure objectives are met, by aligning the risk management process with the organization’s strategy, vision, mission, values, and objectives. By having a risk management program, an organization can identify potential problems before they occur and have a plan for addressing them, as well as monitor and report on the effectiveness of the risk responses. This can help the organization to achieve its desired outcomes and create value for its stakeholders. References = What Is Risk Management & Why Is It Important?

Prioritizing concerns based on frequency of reports is the most efficient approach to analyze the security-related concerns reported by employees, because it helps to identify and focus on the most common or recurring issues that may pose the highest risk or impact to the organization. A security-related concern is a potential or actual problem or threat that may affect the confidentiality, integrity, or availability of the organization’s IT systems or data. A service desk is a function that provides a single point of contact for users to report and resolve their IT-related issues or requests. A workflow is a sequence of steps or tasks that are performed to achieve a specific goal or outcome. A workflow for supporting employee reports of security-related concerns may include capturing, categorizing, prioritizing, assigning, and resolving the concerns. Prioritizing concerns based on frequency of reports is the most efficient approach, as it helps to optimize the use of resources and time, and to reduce the likelihood and severity of security incidents or breaches. Mapping concerns to organizational assets, sorting concerns by likelihood, and aligning concerns to key vendors are all possible approaches to analyze the security-related concerns, but they are not the most efficient approach, as they may require more data collection, analysis, or coordination, and may not reflect the urgency or importance of the concerns. References = Risk and Information Systems Control Study Manual, Chapter 5, Section 5.3.2, page 200

The risk practitioner is responsible for determining which stakeholders need to be involved in the development of a risk scenario, as they have the knowledge and skills to facilitate the process and ensure that the relevant perspectives and information are considered. The risk owner, the compliance manager, and the control owner are examples of stakeholders who may participate in the risk scenario development, but they are not responsible for determining who should be involved. References = Risk Scenarios Toolkit, page 9; CRISC Review Manual, 7th Edition, page 101.

The recovery time objective (RTO) is the planned recovery time for a process or system which should occur before reaching the business process’s maximum tolerable downtime (MTD) or maximum allowable outage (MAO). The RTO must be aligned with the MAO to ensure that the continuity of the business process is not compromised by a prolonged outage. The RTO is determined by the business impact analysis (BIA) based on the criticality and urgency of the business process and its dependencies. The RTO also helps to select and implement appropriate recovery methods and procedures for the process or system. References = Risk and Information Systems Control Study Manual, Chapter 6: IT Risk Monitoring and Reporting, Section 6.2: ITRisk Reporting, Page 307; What is the difference between RPO, RTO, and MTD? - Tandem Blog.

When developing a response plan to address security incidents regarding sensitive data loss, it is most important to review the data classification policy. A data classification policy is a document that defines the categories and levels of data based on their sensitivity, value, and criticality, and specifies the appropriate security measures and handling procedures for each data type. A data classification policy helps to identify and protect the sensitive data that could be exposed or compromised in a security incident, and to comply with the relevant laws, regulations, standards, and contracts. Reviewing the data classification policy is important when developing a response plan, because it helps to determine the scope, impact, and priority of the security incident, and to select the most appropriate and effective response actions and strategies. Reviewing the data classification policy also helps to communicate and coordinate the response plan with the internal and external stakeholders, such as the data owners, users, custodians, and regulators, and to report and disclose the security incident as required. The other options are not as important as reviewing the data classification policy, although they may be part of or derived from the response plan. Revalidating current key risk indicators (KRIs), revising risk management procedures, and revalidating existing risk scenarios are all activities that can help to improve or update the risk management process, but they are not the most important when developing aresponse plan. References = Risk and Information Systems Control Study Manual, Chapter 5, Section 5.3.1, page 5-25.

A data privacy officer is a role that is responsible for ensuring that the organization complies with the applicable laws, regulations, and standards regarding the collection, processing, storage, and disclosure of customer data1. A data privacy officer is also responsible for developing and implementing policies, procedures, and controls to protect the privacy and security of customer data, and to prevent or mitigate the risk of customer data loss2. A data privacy officer is the most helpful role in providing a high-level view of risk related to customer data loss, because:

A data privacy officer has the knowledge and expertise of the legal and ethical requirements and best practices for customer data protection, and can identify and assess the potential threats and vulnerabilities that may compromise customer data3.

A data privacy officer has the authority and accountability to oversee and monitor the customer data lifecycle, and to ensure that the organization follows the principles of data minimization, purpose limitation, accuracy, integrity, confidentiality, and accountability4.

A data privacy officer has the visibility and communication skills to report and advise the management and other stakeholders on the customer data risk profile, and to recommend and implement appropriate risk responses and improvement actions5.

The other options are not the most helpful roles in providing a high-level view of risk related to customer data loss, because:

A customer database manager is a role that is responsible for designing, developing, maintaining, and optimizing the database systems that store and manage customer data6. A customer database manager may have some technical skills and knowledge to protect the customer data from unauthorized access, modification, or deletion, but may not have the comprehensive or holistic view of the customer data risk, as they may focus only on the database level, and not on the organizational or regulatory level.

A customer data custodian is a role that is responsible for handling, processing, and storing customer data according to the instructions and permissions of the data owner7. A customer data custodian may have some operational duties and responsibilities to safeguard the customer data from accidental or intentional loss, damage, or disclosure, but may not have the strategic or analyticalview of the customer data risk, as they may follow only the predefined rules and procedures, and not the risk management principles and practices.

An audit committee is a group of independent directors or members that is responsible for overseeing and evaluating the organization’s financial reporting, internal control, and auditfunctions. An audit committee may have some oversight and assurance roles andresponsibilities to review and verify the organization’s compliance and performance regarding customer data protection, but may not have the direct or proactive view of the customer data risk, as they may rely only on the audit reports and findings, and not on the risk assessment and analysis.

References =

Data Privacy Officer - CIO Wiki

What is a Data Protection Officer (DPO)? - Definition from Techopedia

Data Privacy Officer: Roles and Responsibilities - ISACA

Data Protection Principles - CIO Wiki

Data Privacy Officer: How to Be One and Why You Need One - ISACA

Database Manager - CIO Wiki

Data Custodian - CIO Wiki

[Audit Committee - CIO Wiki]

The best indicator of executive management’s support for IT risk mitigation efforts is the number of executives attending IT security awareness training. This shows that the executives are committed to enhancing their knowledge and skills on IT security issues, and that they are setting a positive example for the rest of the organization. The number of stakeholders involved in IT risk identification workshops, the percentage of corporate budget allocated to IT risk activities, and the percentage of incidents presented to the board are other possible indicators, but they are not as strong as the number of executives attending IT security awareness training. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 7; CRISC Review Manual, 6th Edition, page 202.

Preventive controls are the best types of controls to minimize the risk associated with a vulnerability, because they aim to avoid or reduce the occurrence of a threat or an exploit. Preventive controls can include physical, technical, or administrative measures, such as locks, firewalls, encryption, policies, training, or backup. Preventive controls can also involve eliminating or substituting the source of the vulnerability, such as outdated software or hardware.

References

•ISACA CRISC Review Manual, 7th Edition, Domain 3: Risk Response, Section 3.2.1: Control Types

•Hazard Controls - Princeton University

•Risk Control | Techniques and Importance of Risk Control - EDUCBA

According to the CRISC Review Manual1, cost of controls is the amount of money or resources that an organization is willing to spend to implement and maintain risk responses. Cost of controls is one of the factors that influences the risk appetite of an organization, as it reflects thetrade-off between the benefits and costs of risk responses. Cost of controls helps to determine the optimal level of risk that an organization can accept in pursuit of its objectives, and to align the risk responses with the organization’s strategy, goals, and culture. References = CRISC Review Manual1, page 193.

Data biasin machine learning algorithms can lead to inaccurate predictions or decisions, as biases in training data are amplified in the output. Addressing bias is essential for ethical and reliable algorithm performance.

Control testing is the process of verifying that the risk mitigation controls are designed and operating effectively, and that they achieve the intended objectives and outcomes. Control testing can involve various methods, such as observation, inspection, inquiry, re-performance, or simulation. Control testing results can provide evidence and assurance that the implementation of a risk mitigation control has been completed as intended, and that the control is functioning properly and consistently. Control testing results can also identify any issues or deficiencies in the control design or operation, and recommend corrective actions or improvements. The other options are not as helpful as control testing results, because they do not provide a direct and objective verification of the control implementation, but rather focus on other aspects or outputs of the risk management process, as explained below:

A. An updated risk register is a document that records and tracks the identified risks, their characteristics, and their status. An updated risk register can reflect the changes in the risk profile and exposure after the implementation of a risk mitigation control, but it does not verify that the control implementation has been completed as intended, or that the control is effective and reliable.

B. Risk assessment results are the outputs of the risk analysis and evaluation process, which measure the impact and likelihood of the risks, and assign a risk rating and priority. Risk assessment results can indicate the level of risk exposure and the need for risk mitigation controls, but they do not verify that the control implementation has been completed as intended, or that the control is effective and reliable.

C. Technical control validation is the process of ensuring that the technical aspects of a control, such as hardware, software, or network components, are configured and functioning correctly. Technical control validation can verify that the control implementation meets the technical specifications and requirements, but it does not verify that the control implementation has been completed as intended, or that the control is effective and reliable from a businessperspective. References = Risk and Information Systems Control Study Manual, Chapter 4, Section 4.3.3, page 130.

Least privilege is the best way to reduce the likelihood of an individual performing a potentially harmful action as the result of unnecessary entitlement, because it limits the access and permissions of the individual to the minimum level that is required to perform their role or function, and prevents the individual from accessing or modifying the resources or data that are not relevant or authorized. An entitlement is a right or privilege that grants an individual the ability to access or use a resource or data, such as a file, a system, or an application. An unnecessary entitlement is an entitlement that is not needed or justified for the individual’s role or function, and may pose a risk of unauthorized or inappropriate access or use of the resource or data. A potentially harmful action is an action that may cause harm or damage to the organization or its objectives, such as a data breach, a fraud, or a sabotage. Least privilege is thebest way, as it helps to minimize the exposure and impact of the unnecessary entitlement, and to reduce the likelihood and severity of the potentially harmful action. Application monitoring, separation of duty, and nonrepudiation are all possible ways to reduce the likelihoodof an individual performing a potentially harmful action as the result of unnecessary entitlement, but they are not the best way, as they do not directly address the unnecessary entitlement, and may not prevent the potentially harmful action. References = Risk and Information Systems Control Study Manual, Chapter 5, Section 5.3.2, page 200

 Cost-benefit analysis is the most helpful tool to show risk reduction based on when developing risk treatment alternatives for a business case, because it compares the expected costs and benefits of each alternative and helps to select the most optimal and feasible one. Cost-benefit analysis also helps to justify the investment and resources required for the risk treatment plan and to demonstrate the value and return of the risk reduction. The other options are not the most helpful tools, although they may also be considered when developing risk treatment alternatives. Risk appetite, regulatory guidelines, and control efficiency are examples of factors or criteria that influence the selection of risk treatment alternatives, but they do not show the risk reduction based on the alternatives. References = CRISC: Certified in Risk & Information Systems Control Sample Questions

The business application owner is responsible for the application's performance and availability. Therefore, they should approve any maintenance schedules that could impact the application's functionality, including temporary loss of failover capabilities. Their approval ensures that the business implications are considered and that appropriate contingency plans are in place.

Classifying information assets is a process of identifying and categorizing the data and information resources that are owned, controlled, or used by an organization, based on their value, sensitivity, and criticality.

Classifying information assets helps to determine the appropriate level of control that is needed to protect them from unauthorized access, use, disclosure, modification, or destruction. Control level refers to the degree of protection or assurance that a control provides against a risk.

Classifying information assets also helps to communicate risk to senior management, assign risk ownership, and facilitate internal audit. These are other benefits of risk management that are not directly related to determining the appropriate level of control.

The references for this answer are:

Risk IT Framework, page 11

Information Technology & Security, page 5

Risk Scenarios Starter Pack, page 3

A change management process is a set of procedures and activities that aim to ensure that changes in an organization’s IT systems and services are implemented in a controlled and coordinated manner. The effectiveness of a change management process can be measured by how well it reduces the risks and costs associated with changes, and how well it supports the business objectives and customer expectations. One of the best metrics to demonstrate the effectiveness of a change management process is the percent of unauthorized changes. Unauthorized changes are changes that are made without following the established change management process, such as obtaining approval, documenting the change, testing the change, and communicating the change. Unauthorized changes can introduce errors, defects, security breaches, and disruptions to the IT systems and services, and can negatively affect the business performance and customer satisfaction. Therefore, a low percent of unauthorized changes indicates that the change management process is effective in ensuring that changes are properly planned, approved, executed, and monitored. The other options are not the best metrics to demonstrate the effectiveness of a change management process, as they do not directly reflect the quality and control of the changes. An increase in the frequency of changes may indicate that the organization is agile and responsive to the changing business needs and customer demands, but it does not necessarily mean that the changes are well-managed and beneficial. An increase in the number of emergency changes may indicate that the organization is able to handle urgent and critical situations, but it may also suggest that the organization is reactive and lacks proper planning and analysis of the changes. The average time to complete changes may indicate the efficiency and speed of the change management process, but it does not measure the effectiveness and value of the changes. References = CRISC Review Manual, pages 156-1571; CRISC Review Questions, Answers & Explanations Manual, page 712

According to the CRISC Review Manual1, risk scenarios are hypothetical situations that describe the potential causes, impacts, and responses of a risk event. Risk scenarios are useful tools for identifying, analyzing, and communicating risks in a clear and understandable way. The most important factor when developing risk scenarios is to ensure that they are relevant to the organization, as this helps to capture the specific context, objectives, processes, and resources of the organization, and to reflect the actual risk exposure and appetite of the organization. Relevant risk scenarios also help to engage and involve the stakeholders, and to facilitate risk-based decision making and action planning. References = CRISC Review Manual1, page 206.

An IT risk register is a document that is used as a risk management tool to identify, analyze, and track the potential risks related to the use of information technology within an organization. An IT risk register helps management to understand the organizational risk profile, which is a comprehensive and structured representation of the risks that the organization faces. The risk profile helps the organization to understand its risk exposure, appetite, and tolerance, and to align its risk management strategy with its business objectives and context. The risk register is an essential input for creating and updating the risk profile, as it provides the data and analysis ofthe risks that need to be prioritized and addressed12. The other options are not the best answers, as they are either not directly shown or derived from the IT risk register. Aligning IT processes with business objectives is a goal of IT governance, which may be influenced by the IT risk register, but not solely determined by it. Communicating the enterprise risk management policy is a responsibility of the senior management and the board of directors, which may use the IT risk register as a reference, but not as the main source. Staying current with existing control status is a function of IT audit and assurance, which may rely on the IT risk register as a basis, but not as the only evidence. References = Risk Register: A Project Manager’s Guide with Examples [2023] • Asana; Complete Guide to IT Risk Management | CompTIA

Insecure data transmission protocols should be of greatest concern when an organization is implementing internet of Things (IoT) technology to control temperature and lighting in its headquarters, because they can expose the IoT devices and data to unauthorized access,interception, or manipulation. Insecure data transmission protocols can also compromise the confidentiality, integrity, and availability of the IoT system and the information it collects and transmits. The other options are not the greatest concerns, although they may also pose some challenges or risks to the IoT implementation. Insufficient network isolation, impact on networkperformance, and lack of interoperability between sensors are examples of technical or operational issues that can affect the functionality, efficiency, or compatibility of the IoT system, but they do not have the same severity or impact as insecure data transmission protocols. References = CRISC Sample Questions 2024

The best type of indicators to measure the effectiveness of an organization’s firewall rule set are key control indicators (KCIs). A firewall is a device or software that filters the network traffic based on a set of rules or policies. A firewall rule set is the configuration of the firewall that defines the criteria for allowing or blocking the traffic. A key control indicator is a metric that measures the performance and effectiveness of a control in achieving its objectives and mitigating the risks. A key control indicator can help to evaluate the adequacy and efficiency of the firewall rule set, and to identify any gaps, weaknesses, or issues that need to be addressed.Key risk indicators (KRIs), key management indicators (KMIs), and key performance indicators (KPIs) are not as suitable as key control indicators, as they measure different aspects of the risk management process, such as the level and nature of the risk exposure, the alignment and integration of the risk management activities, and the achievement of the risk management goals and targets. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 220.

Using an entry in the risk register to track the aggregate risk associated with server failure provides a comprehensive view of the impact should the servers simultaneously fail, as it considers the combined effect of the server failure on the enterprise’s objectives and operations. The risk register is a document that records and tracks the identified risks, their likelihood, impact, and mitigation strategies. By aggregating the risk associated with server failure, the risk register can help to estimate the worst-case scenario and to prioritize the risk response accordingly. It provides a cost-benefit analysis on controloptions available for implementation, it provides a view on where controls should be applied to maximize the uptime of servers, and it provides historical information about the impact of individual servers malfunctioning are not the primary benefits of using an entry in the risk register to track the aggregate risk associated with server failure, but rather the possible outcomes or actions of using the risk register. References = CRISC Certified in Risk and Information Systems Control –Question220; ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 220.

 The most important requirement to include in an outsourcing contract to help ensure sensitive data stored with a service provider is secure is a third-party assessment report of control environment effectiveness. This will help to verify that the service provider has implemented adequate security controls and practices to protect the data, and that they comply with the enterprise’s security policies and standards. A third-party assessment report also provides an independent and objective assurance of the service provider’s security posture and performance. Incidents related to data loss, risk assessment results, and cyber insurance policy are also important requirements to include in an outsourcing contract, but they are not as important as a third-party assessment report. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 5, Section 5.2.1.2, page 2461

1: ISACA Certified in Risk and Information Systems Control (CRISC®) Exam Guide, Answer to Question 643.

Continuous risk management process improvement is the practice of evaluating and enhancing the risk management process on a regular basis, to ensure that it is effective, efficient, and aligned with the business objectives and strategy. Continuous risk management processimprovement can help identify and address the gaps, weaknesses, or opportunities for improvement in the risk management process, and ensure that the process is responsive and adaptable to the changing risk environment. The most effective method for continuous risk management process improvement is periodic assessments, which are systematic and objective evaluations of the risk management process, performed at predefined intervals or after significant events. Periodic assessments can help measure and monitor the performance and maturity of the risk management process, using criteria such as the risk management framework, standards, policies, procedures, methods, tools, roles, responsibilities, and results. Periodic assessments can also help identify and analyze the strengths, weaknesses, threats, and opportunities of the risk management process, and provide feedback and recommendations for improvement. Periodic assessments can also help communicate and report the status and progress of the risk management process to the stakeholders, and obtain their input and support for improvement actions. References = Continuous Risk Management Guidebook, p. 7-8, ISO 31000: riskmanagement and its continuous improvement, How Continuous Monitoring Drives Risk Management.

Backups are the best control to mitigate the impact of a failed IT system upgrade project that has resulted in the corruption of an organization’s asset inventory database, as they allow theorganization to restore the data from a previous state and resume normal operations. Encryption, authentication, and configuration are not the best controls, as they do not address the data corruption issue, but rather the datasecurity, access, and quality issues, respectively. References = CRISC Review Manual, 7th Edition, page 153.

Data privacy protection is the process of safeguarding the personal information of individuals from unauthorized access, use, disclosure, modification, or destruction. Personal information is any information that can be used to identify, locate, or contact an individual, such as name, address, phone number, email, social security number, etc. When there are plans for a business initiative to make use of personal information, the primary consideration related to data privacyprotection is to do not collect or retain data that is not needed. This means that the organization should only collect the minimum amount of personal information that is necessary for the purpose of the business initiative, and should only retain the data for as long as it is required by law or business needs. By doing so, the organization can reduce the risk of data breaches,comply with the data protection regulations, respect the data subjects’ rights, and enhance the trust and reputation of the organization. References = CRISC Review Manual, 7th Edition, page 159.

 Risk Appetite:

Risk appetite is the amount and type of risk that an organization is willing to take in order to meet its objectives. It reflects the organization’s risk tolerance and guides decision-making at all levels.

 Impact of Market Changes:

A change in the market situation can alter the risk landscape, potentially affecting the organization’s ability to achieve its objectives. This might necessitate a reassessment of what level of risk is acceptable.

Senior management needs to ensure that the risk appetite remains aligned with the new market conditions and organizational goals.

 Reevaluation Process:

Reevaluating the risk appetite involves assessing the organization's capacity to bear risk and determining if the current acceptable risk levels are still appropriate.

This might involve more conservative or aggressive risk-taking strategies based on the new market dynamics.

 Other Considerations:

Risk Classification:This categorizes risks but does not directly address changes in acceptable risk levels.

Risk Policy:While important, the policy outlines the approach to managing risk and is influenced by the risk appetite.

Risk Strategy:This defines how risks are managed but should be aligned with the risk appetite.

 References:

The CRISC Review Manual emphasizes the importance of aligning risk appetite with the organization’s strategic objectives and market conditions (CRISC Review Manual, Chapter 1: Governance, Section 1.10 Risk Appetite, Tolerance, and Capacity) .

 Utilizing secure encryption protocols is the most important factor to mitigate risk associated with data privacy when implementing a new Software as a Service (SaaS) speech-to-text solution, as it ensures that the data is protected from unauthorized access, interception, or modification during the transmission and storage in the cloud. Setting up multi-factor authentication for users, approving the solution architecture by IT, and including a risk transfer clause in the contract are not the most important factors, as they may not address the data privacy issue, but rather the data access, quality, or liability issue, respectively. References = CRISC Review Manual, 7th Edition, page 153.