CRISC Exam Dumps - Certified in Risk and Information Systems Control

A risk response is the action or plan that is taken to address a specific risk that has been identified, analyzed, and evaluated. It can be one of the following types: mitigate, transfer, avoid, or accept.

The highest priority when developing a risk response is to ensure that it aligns with the organization’s risk appetite, which is the amount and type of risk that the organization is willing to accept in pursuit of its goals. The risk appetite is usually expressed as a range or a threshold, and it is aligned with the organization’s strategy and culture.

Aligning the risk response with the organization’s risk appetite ensures that the risk response is consistent, appropriate, and proportional to the level and nature of the risk, and that it supports the organization’s objectives and values. It also helps to optimize the balance between risk and return, and to create and protect value for the organization and its stakeholders.

The other options are not the highest priority when developing a risk response, because they do not address the fundamental question of whether the risk response is suitable and acceptable for the organization.

The risk response addresses the risk with a holistic view means that the risk response considers the interrelationships and dependencies among the risk sources, events, impacts, and responses, and the potential secondary and residual effects of the risk response. This is important to ensure that the risk response is comprehensive and effective, and that it does not create new or unintended risks, but it is not the highest priority when developing a risk response, because it does not indicate whether the risk response is aligned with the organization’s risk appetite.

The risk response is based on a cost-benefit analysis means that the risk response compares the expected costs and benefits of implementing the risk response, and selects the risk response that provides the most favorable net outcome. This is important to ensure that the risk response is efficient and economical, and that it maximizes the return on investment, but it is not the highest priority when developing a risk response, because it does not indicate whether the risk response is aligned with the organization’s risk appetite.

The risk response is accounted for in the budget means that the risk response is included in the financial plan and allocation of resources for the organization or the project. This is important to ensure that the risk response is feasible and realistic, and that it has the necessary funding and support, but it is not the highest priority when developing a risk response, because it does not indicate whether the risk response is aligned with the organization’s risk appetite. References =

ISACA, CRISC Review Manual, 7th Edition, 2022, pp. 29-30, 34-35, 38-39, 44-45, 50-51, 54-55

ISACA, CRISC Review Questions, Answers & Explanations Database, 2022, QID 147

Detailed Explanation:A data classification program helpsidentify appropriate controlsby categorizing data based on sensitivity and criticality. This ensures that data protection measures are aligned with its value and risk level, improving overall security posture.

IT control status reporting is the process of collecting and analyzing data about the effectiveness and efficiency of IT controls. IT controls are the policies, procedures, and practices that ensure the confidentiality, integrity, and availability of IT resources and information. IT control status reporting helps to monitor the performance of IT controls against the predefined objectives and criteria, and to identify any gaps or issues that need to be addressed. IT control status reporting also provides information to the stakeholders about the current status and progress of IT control implementation and improvement.

The primary purpose of IT control status reporting is to facilitate the comparison of the current and desired states of IT controls. This means that IT control status reporting helps to evaluate the gap between the actual and expected performance of IT controls, and to determine the actions and resources needed to close the gap. IT control status reporting also helps to align the IT controls with the business goals and strategies, and to ensure that the IT controls are delivering value to the organization. By comparing the current and desired states of IT controls, IT control status reporting enables continuous improvement and optimization of IT control processes and outcomes.

The other options are not the primary purpose of IT control status reporting, but rather some of the benefits or outcomes of it. IT control status reporting can help to ensure compliance with IT governance strategy,but it is not the main reason for doing it. IT governance is the framework that defines the roles, responsibilities, and relationships among the stakeholders involved in IT decision making and oversight. IT control status reporting can support IT governance by providing relevant and reliable information to the stakeholders, and by demonstrating the accountability and transparency of IT control activities. However, IT control status reporting is not the same as IT governance, and it is not the only way to ensure compliance with IT governance strategy.

IT control status reporting can also assist internal audit in evaluating and initiating remediation efforts, but it is not the main objective of it. Internal audit is an independent and objective assurance and consulting activity that evaluates the adequacy and effectiveness of IT controls, and provides recommendations for improvement. IT control status reporting can provide input and evidence to the internal audit process, and help to identify the areas of IT control that need further review or testing. IT control status reporting can also help to monitor and track the implementation of the audit findings and recommendations, and to verify the results of the remediation efforts. However, IT control status reporting is not the same as internal audit, and it is not the only source of information for internal audit.

Finally, IT control status reporting can benchmark IT controls with industry standards, but it is not the main goal of it. Industry standards are the best practices or guidelines that define the minimum requirements or expectations for IT control performance and quality. IT control status reporting can help to compare the IT controls with the industry standards, and to identify the areas of IT control that need to be enhanced or updated. IT control status reporting can also help to demonstrate the compliance or conformance of IT controls with the industry standards, and to provide assurance to the external parties or regulators. However, IT control status reporting is not the same as industry standards, and it is not the only way to benchmark IT controls. References =

Service Reporting in ITIL: Process, Objectives and Examples - KnowledgeHut

Anatomy of an effective status report - Project Management Institute

How to Create a Project Status Report [Template & Examples]

Communicating Document Control Progress on a Project

[CRISC Review Manual, 7th Edition]

 Providing acknowledgments from receiver to sender is a control that helps to ensure that transaction data reaches its destination, as it confirms the successful delivery of the data and allows the sender to resend the data in case of failure. Securing the network from attacks, digitally signing individual messages, and encrypting data-in-transit are controls that help to ensure the integrity and confidentiality of the data, but not the availability or delivery of the data. References = CRISC by Isaca Actual Free Exam Q&As, question 199.

Ongoing availability of data is the most important consideration when selecting key risk indicators (KRIs) to monitor risk trends over time, as it ensures that the KRIs can provide timely and reliable information on the current and future risk status and performance. KRIs are metrics that measure the level of risk exposureand the effectiveness of risk response strategies, and they should be aligned with the enterprise’s risk appetite and objectives. Ongoing availability of data means that the data sources and collection methods for the KRIs are consistent, accessible, and sustainable, and that the data quality and integrity are maintained and verified. Ability to aggregate data, ability to predict trends, and availability of automated reporting systems are not the most important considerations, as they do not affect the validity and usefulness of the KRIs, but rather the presentation and analysis of the KRI data. References = CRISC Certified in Risk and Information Systems Control – Question213; ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 213.

The risk practitioner’s primary focus when determining whether controls are adequate to mitigate risk should be the level of residual risk, because this indicates the amount and type of risk that remains after applying the controls, and whether it is acceptable or not. Residual risk is the risk that is left over after the risk responseactions have been taken, such as implementing or improving controls. Controls are the measures or actions that are designed and performed to reduce the likelihood and/or impact of a risk event, or to exploit the opportunities that a risk event may create. The adequacy of controls to mitigate risk depends on how well they address the root causes or sources of the risk, and how effectively and efficiently they reduce the risk exposure and value. The level of residual risk reflects the adequacy of controls to mitigate risk, as it shows the gap between the inherent risk and the actual risk, and whether it is within the organization’s risk appetite and tolerance. The risk practitioner should focus on the level of residual risk when determining whether controls are adequate to mitigate risk, as it helps to evaluate and compare the benefits and costs of the controls, and to decide on the best risk response strategy, such as accepting, avoiding, transferring, or further reducing the risk. The other options are less important or relevant to focus on when determining whether controls are adequate to mitigate risk. Sensitivity analysis is a technique that measures how the risk value changes when one or more input variables are changed, such as the probability, impact, or control effectiveness. Sensitivity analysis can help to identify and prioritize the most influential or critical variables that affect the risk value, and to test the robustness or reliability of the risk assessment. However, sensitivity analysis does not directly indicate the adequacy of controls to mitigate risk, as it does not measure the level of residual risk or the risk acceptance criteria. Cost-benefit analysis is a technique that compares the expected benefits and costs of a control or a risk response action, and determines whether it is worthwhile or not. Cost-benefit analysis can help to justify and optimize the investment or resource allocation for the control or the risk response action, and to ensure that it is aligned with the organization’s objectives and value. However, cost-benefit analysis does not directly indicate the adequacy of controls to mitigate risk, as it does not measure the level of residual risk or the risk acceptance criteria. Risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives. Risk appetite can help to define and communicate the organization’s risk preferences and boundaries, and to guide the risk decision-making and behavior. However, risk appetite does not directly indicate the adequacy of controls to mitigate risk, as it does not measure the level of residual risk or the actual risk performance. References = Risk IT Framework, ISACA, 2022, p. 131

 The most important consideration when selecting an external service provider for outsourcing the payroll function is the internal controls to ensure data privacy. The payroll function involves processing and storingsensitive personal and financial information of the employees, such as salaries, taxes, benefits, bank accounts, etc. This information needs to be protected from unauthorized access, disclosure, modification, or loss, as it may result in legal, regulatory, reputational, or financial consequences for the organization and the employees. Therefore, the external service provider should have adequate internal controls, such as encryption, access control, backup, logging, monitoring, etc., to ensure data privacy and compliance with the organization’s policies and standards. Disaster recovery plan, right to audit, and transparency of KPIs are also important considerations when selecting an external service provider, but they are not as important as internal controls to ensure data privacy. 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 648.

The annualized loss expectancy (ALE) method of risk analysis is a quantitative method that estimates the expected monetary loss that can result from a risk over a one year period. The ALE is calculated by multiplying the single loss expectancy (SLE), which is the monetary loss from a single occurrence of a risk, by the annualized rate of occurrence (ARO), which is the frequency of the risk occurring in a year. The ALE can be used in a cost-benefit analysis to compare the cost of implementing a control or a risk response with the expected benefit of reducing the loss. The ALE can help to justify the investment in risk management and to prioritize the risks based on their financial impact. The other options are not accurate descriptions of the ALE method of risk analysis, as they involve different aspects or methods of risk analysis. References = Risk and Information Systems Control Study Manual, 7th Edition, Chapter 2, Section 2.3.2.1, pp. 60-61.