CRISC Exam Dumps - Certified in Risk and Information Systems Control

The stakeholders who are PRIMARILY responsible for determining enterprise IT risk appetite are the executive management and the board of directors, because they are the ones who set thestrategic direction and objectives of the enterprise, and who define the acceptable level of risk exposure and tolerance for achieving those objectives. The other options are not the primary stakeholders, because:

Option A: Audit and compliance management are responsible for providing assurance and oversight on the effectiveness of the risk management process and the compliance with internal and external requirements, but they do not determine the enterprise IT risk appetite.

Option B: The CIO and the CFO are responsible for managing the IT resources and the financial resources of the enterprise, respectively, but they do not determine the enterprise IT risk appetite.

Option C: Enterprise risk management and business process owners are responsible for identifying, assessing, and responding to the risks that affect their domains, but they do not determine the enterprise IT risk appetite. References = Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, p. 83.

The best action for the risk practitioner to take when business areas within an organization have engaged various cloud service providers directly without assistance from the IT department is to recommend a risk assessment be conducted. A risk assessment is a process of identifying, analyzing, and evaluating the risks associated with the use of cloud services, such as financial, privacy, compliance, security, performance, quality, and technical risks12. A risk assessment can help to determine the current and potential risk exposure and impact of the cloud services, as well as the effectiveness and efficiency of theexisting or proposed controls. A risk assessment can also help to prioritize the risks and to develop and implement appropriate risk response strategies and plans, such as risk avoidance, reduction, sharing, or acceptance. Recommending a risk assessment is the best action, because it can provide valuable information and guidance to the business areas and the IT department for managing the cloud services in a consistent, effective, and efficient manner, and for aligning the cloud services with the organizational objectives, strategy, and risk appetite. The other options are not the best action, although they may be related or subsequent steps in the risk management process. Recommending the IT department remove access to the cloud services is a drastic and impractical action, as it may disrupt the business operations and services, and it may not address the underlying causes or drivers of the cloud service adoption. Engaging with the business area managers to review controls applied is a useful and collaborative action, as it can help to understand and evaluate the current state and practices of the cloud service usage, and to identify and address any gaps or issues in the control environment. However, this action should be based on or supported by a risk assessment, rather than preceding or replacing it. Escalating to the risk committee is a reporting and communication action, as it can help to inform and involve the senior management and other stakeholders in the risk management process, and to obtain their support and approval for the risk response actions. However, this action should be done after or along with a risk assessment, rather than before or instead of it. References = Best Practices to Manage Risks in the Cloud - ISACA, Cloud Risk Management - PwC UK

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.

 The chief information officer (CIO) is the most likely person to be responsible for the coordination between the IT risk strategy and the business risk strategy, because the CIO is the senior executive who oversees the information technology (IT) function and aligns it with the organization’s strategy, objectives, and operations. The CIO is also responsible for ensuring that the IT function delivers value, supports innovation, and manages IT risks effectively and efficiently. The CIO can coordinate the IT risk strategy and the business risk strategy by communicating and collaborating with other business leaders, establishing and implementing IT governance frameworks and policies, and monitoring and reporting on IT performance and risk indicators. The other options are not as likely as the CIO to be responsible for the coordination between the IT risk strategy and the business risk strategy, because they have different or limited roles and responsibilities in relation to IT and business risk management, as explained below:

A. Chief financial officer (CFO) is the senior executive who oversees the financial function and manages the financial risks of the organization. The CFO may be involved in the coordination between the IT risk strategy and the business risk strategy, especially when it comes to budgeting, funding, or reporting on IT-related projects and initiatives, but the CFO is not the primary person who oversees the IT function and aligns it with the organization’s strategy and objectives.

B. Information security director is the senior manager who oversees the information security function and manages the information security risks of the organization. The information security director may be involved in the coordination between the IT risk strategy and the business risk strategy, especially when it comes to protecting the confidentiality, integrity, and availability of the information assets and systems, but the information security director is not the primary person who oversees the IT function and aligns it with the organization’s strategy and objectives.

C. Internal audit director is the senior manager who oversees the internal audit function and provides independent assurance on the effectiveness and efficiency of the organization’s governance, risk management, and control processes. The internal audit director may be involved in the coordination between the IT risk strategy and the business risk strategy, especially when it comes to auditing, reviewing, or testing the IT-related processes and controls, but the internal audit director is not the primary person who oversees the IT function and aligns it with the organization’s strategy and objectives. References = Risk and Information Systems Control Study Manual, Chapter 1, Section 1.1.1, page 7. The Strategic CIO: Balancing Business and ITPriorities, Technology’s Role in Enterprise Risk Management, Aligning Enterprise Cyber Risk and Business Strategy

Showing projected residual risk is the most helpful way to respond to the request of explaining how existing risk treatment plans would affect risk posture at the end of the year. Residual risk is the level of risk that remains after the implementation of risk responses1. Projected residual risk is the estimated level of risk that will remain at a future point in time, based on the assumptions and expectations of the risk responses2. By showing projected residual risk, the risk practitioner can:

Demonstrate the effectiveness and efficiency of the risk treatment plans, and how they reduce the risk level from the inherent risk (the risk before the risk responses) to the residual risk3.

Compare the projected residual risk with the risk appetite and tolerance, which are the amount and type of risk that the organization is willing to accept or pursue in order to achieve its objectives4. This can help to determine whether the projected residual risk is acceptable or not, and whether the risk treatment plans are consistent and proportional to the risk level5.

Identify and address any gaps, issues, or challenges that may affect the achievement of the projected residual risk, and recommend and implement appropriate improvement actions or contingency plans6.

The other options are not the most helpful ways to respond to the request, because:

Assessing risk with no controls in place is not the most helpful way, as it does not reflect the current or future risk posture of the organization. Controls are the measures or actions that are implemented to modify the risk, such as prevent, detect, correct, or mitigate the risk7. Assessing risk with no controls in place can help to measure the inherent risk, but it does not show the impact or outcome of the risk treatment plans.

Providing peer benchmarking results is not the most helpful way, as it does not reflect the specific or unique risk profile of the organization. Peer benchmarking is the process ofcomparing the organization’s risk level and performance with its peers or competitors, based on a common set of criteria or indicators8. Providing peer benchmarking results can help to provide a reference or a standard for the risk posture, but it does not show the effect or result of the risk treatment plans.

Assessing risk with current controls in place is not the most helpful way, as it does not reflect the future or projected risk posture of the organization. Assessing risk with current controls in place can help to measure the current residual risk, but it does not show the expected or estimated residual risk at the end of the year.

References =

Residual Risk - CIO Wiki

Projected Residual Risk - CIO Wiki

Risk Treatment Plan - CIO Wiki

Risk Appetite and Tolerance - CIO Wiki

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

Risk Monitoring and Review - The National Academies Press

Control - CIO Wiki

Benchmarking - CIO Wiki

[Risk Treatment - CIO Wiki]

The greatest challenge for a risk practitioner during a merger of two organizations is the variances between organizational risk appetites, as they may indicate a significant difference in the risk culture, strategy, and objectives of the two organizations, and may require a complex and lengthy process of alignment and integration. Different taxonomies to categorize risk scenarios, disparate platforms for governance, risk, and compliance (GRC) systems, and dissimilar organizational risk acceptance protocols are not the greatest challenges, as they are more related to the technical, operational, or procedural aspects of risk management, rather than the strategicor cultural aspects of risk management. References = CRISC Review Manual, 7th Edition, page 109.

Accurate asset inventories depend on havingformal, standardized processes for onboarding new assets. ISACA emphasizes that without proper onboarding and updating procedures, asset data quickly becomes inaccurate and unreliable for risk management.

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The risk practitioner’s best recommendation when one of an organization’s key IT systems cannot be patched because the patches interfere with critical business application functionalities is to identify additional mitigating controls, as they may reduce the likelihood or impact of the vulnerabilities being exploited, and align the residual risk with the risk tolerance and appetite of the organization. The other options are not the best recommendations, as they may not address the risk adequately, or may introduce unacceptable consequences, such as disrupting the businessoperations, changing the risk strategy, or accepting excessive risk. References = CRISC Review Manual, 7th Edition, page 111.