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According to the Risk and Information Systems Control documents, the risk practitioner should conclude that no action is required as there was no impact. The fact that there have been no interruptions to business operations despite the increasing hardware failure incidents indicates that the built-in redundancy and fault-tolerant architecture are effective in ensuring continuity.

Options A and C are not necessary in this scenario. A root cause analysis (Option A) might be considered if there were actual interruptions or impact on business operations. However, since there were no interruptions, a root cause analysis may not be immediately required. Similarly, upgrading hardware (Option C) may not be necessary if the existing controls are effectively preventing business disruptions.

References = Risk and Information Systems Control Study Manual

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

Administrative controls are the best controls to be strengthened by a clear organizational code of ethics, because they are the policies, procedures, standards, and guidelines that define the expected behavior and conduct of the employees and management. A code of ethics is an example of an administrative control that sets the ethical principles and values of the organization and helps to prevent or deter unethical or illegal actions. The other options are not the best controls to be strengthened by a clear organizational code of ethics, because they are not directly related to the ethical culture or governance of the organization. Detective controls are the controls that monitor and report the occurrence of unwanted events or incidents. Technical controls are the controls that use hardware, software, or network devices to protect the information systems and data. Preventive controls are the controls that prevent or avoid the occurrence of unwanted events or incidents. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers

The most comprehensive input to the risk assessment process specific to the effects of system downtime is the business impact analysis (BIA). The BIA is a process of analyzing the potential impacts of disruptive events on the business processes, functions, and resources. The BIA identifies the criticality, dependencies, recovery priorities, and recovery objectives of the business processes, and quantifies the financial and non-financial impacts of system downtime. The BIA provides valuable information for the risk assessment process, as it helps to evaluate the likelihood and impact of the risks, and to determine the appropriate risk responses. Business continuity plan (BCP) testing results, recovery time objective (RTO), and recovery point objective (RPO) are not as comprehensive as the BIA, as they are derived from the BIA and focus on specific aspects of the business continuity and recovery strategies. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 130.

 A risk assessment is a process that identifies, analyzes, and evaluates the risks that an organization faces in relation to its objectives, assets, and operations. A risk assessment helps to determine the likelihood and impact of potential threats, as well as the adequacy and effectiveness of existing controls. A risk assessment also provides the basis for risk treatment, which involves selecting and implementing the appropriate risk responses, such as avoiding,transferring, mitigating, or accepting the risk. The client’s best course of action in this scenario is to perform their own risk assessment, rather than relying on the third-party service provider’s risk assessment. This is because the third-party service provider may have different risk criteria, assumptions, methods, or perspectives than the client, and may not fully understand or address the client’s specific risk context, needs, and expectations. The third-party service provider’s risk assessment may also be biased, outdated, or inaccurate, and may not reflect the current or future risk environment. By performing their own risk assessment, the client can ensure that the risk of their systems being hacked is properly identified, measured, and managed, and that the risk level is acceptable and aligned with their risk appetite and tolerance. The other options are not the best courses of action for the client, as they may expose the client to unnecessary or unacceptable risk. Implementing additional controls to address the risk may be costly, ineffective, or redundant, and may not be justified by the actual risk level. Accepting the risk based on the third-party service provider’s risk assessment may be risky, as the client may not have a clear or accurate understanding of the risk exposure or consequences. Performing an independent audit of the third party may be useful, but it may not be sufficient or timely to assess and address the risk of the client’s systems being hacked. References = CRISC Review Manual, pages 38-391; CRISC Review Questions, Answers & Explanations Manual, page 792

Reporting risk assessment results to senior management is an essential part of risk communication, which is the process of sharing relevant and timely information about the risk exposure and risk management activities with the stakeholders. The most important benefit of reporting risk assessment results to senior management is to facilitate risk-aware decision making, which is the process of incorporating the risk information and analysis into the strategic and operational decisions of the organization. By reporting the risk assessment results, the risk practitioner can provide senior management with the insight and understanding of the current and potential risks, their likelihood and impact, their interrelationships and dependencies, and their alignment with the risk appetite and tolerance. This can help senior management to prioritize the risks, allocate the resources, select the risk responses, monitor the risk performance, and evaluate the risk outcomes. References = CRISC Review Manual, 7th Edition, page 105.

Senior management involvement is foundational to an effective risk management framework. Lack of engagement signals inadequate oversight, strategic alignment, and resource commitment, impairing the program's success. This is supported by CRISC's focus on governance and leadership alignment to ensure enterprise risk management objectives are met.

 In an environment where reduced time-to-market for new software products is a top business priority, the risk practitioner’s greatest concern should be whether sufficient resources are assigned to IT development projects. Resources include human, financial, technical, and physical assets that are needed to plan, design, develop, test, and deliver high-quality software products in a timely manner. If the IT development projects are under-resourced, they may face challenges such as delays, errors, defects, rework, scope creep, or failure to meet customer expectations or requirements. These challenges can increase the risk of losing competitive advantage, market share, customer satisfaction, or reputation. The other options are less critical, as they are not directly related to the core business priority of reducing time-to-market for new softwareproducts. Customer support help desk staff training, email infrastructure rollback plans, and corporate email system phishing detection are important aspects of information security and customer service, but they are not the primary drivers of software product development anddelivery. References = Risk and Information Systems Control Study Manual, Chapter 3: IT Risk Response, Section 3.2: Risk Response Options, p. 115-116.

The greatest benefit of using IT risk scenarios is that they facilitate communication of risk, as they provide a clear and realistic description of the risk sources, events, impacts, and responses, and enable the stakeholders to understand and appreciate the risk exposure and appetite of the organization. Supporting compliance with regulations, providing evidence of risk assessment, and enabling the use of key risk indicators (KRIs) are also benefits of using IT risk scenarios, but they are not the greatest benefit, as they are more related to the outcomes or consequences of risk communication, rather than the process or value of risk communication. References = CRISC Review Manual, 7th Edition, page 100.

 The best way to validate whether controls to reduce user device vulnerabilities have been implemented according to management’s action plan is to rescan the user environment, as it provides an objective and reliable way to measure and verify the effectiveness and adequacy of the controls, and to detect any remaining or new vulnerabilities. Surveying device owners, requiring annual end user policy acceptance, and reviewing awareness training assessment results are not the best ways, as they may not provide sufficient assurance, evidence, or timeliness of the control validation, respectively. References = CRISC Review Manual, 7th Edition, page 154.

A cost-benefit analysis is a tool that compares the costs and benefits of different alternatives, such as implementing or not implementing a specific control. A cost-benefit analysis provides the most useful information when determining if a specific control should be implemented, as it can show the potential savings, benefits, and risks of each option, and help the decision-makers choose the best course of action. A cost-benefit analysis can also include qualitative factors, such as security, compliance, performance, and customer satisfaction, that may be affected by thecontrol implementation. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 256. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 256. Most Asked CRISC Exam Questions and Answers, Question 10. CRISC by Isaca Actual Free Exam Q&As, Question 9.

Involving stakeholders ensures all perspectives are considered, leading to more accurate risk identification, assessment, and prioritization.

 An analysis of the security logs that illustrate the sequence of events is the most important information for the person responsible for managing the incident, as it can help to identify the source, scope, and impact of the security breach, and to determine the appropriate response actions. An analysis of the security logs can also provide evidence for forensic investigation and legal action, and help to prevent or mitigate future incidents by identifying the root causes and vulnerabilities. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 235. CRISC by Isaca Actual FreeExam Q&As, Question 9. CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 235. CRISC Sample Questions 2024, Question 235.

Risk aggregation in a complex organization will be MOST successful when using the same scales in assessing risk, because it can help to ensure the consistency and comparability of the risk assessment results across different units, levels, and domains of the organization. Using the same scales in assessing risk can also help to avoid the potential errors or biases that may arise from using different scales, such as overestimating or underestimating the risk exposure, or misaligning the risk appetite and tolerance. The other options are not as important as using the same scales in assessing risk, because:

Option B: Utilizing industry benchmarks is a good way to improve the quality and validity of the risk assessment results, but it does not ensure the success of the risk aggregation, which is the process of combining and consolidating the risk assessment results into a holistic and comprehensive view of the risk profile and exposure of the organization.

Option C: Using reliable qualitative data for risk items is a useful way to capture and describe the risk items, which are the sources and causes of the risks, but it does not ensure the success of the risk aggregation, which is the process of quantifying and measuring the risk items, and their likelihood and impact on the business objectives and processes.

Option D: Including primarily low-level risk factors is a necessary way to identify and assess the risk factors, which are the characteristics and attributes of the risks, but it does not ensure the success of the risk aggregation, which is the process of prioritizing and ranking the risk factors, and their significance and relevance to the organization’s strategy and goals. References = Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, p. 105.

According to the CRISC Review Manual, risk taxonomy is the system of classification and categorization of risks based on common characteristics and attributes. Risk taxonomy is necessary to enable an IT risk register to be consolidated with the rest of the organization’s risk register, because it helps to ensure consistency, comparability, and alignment of the risks across the organization. Risk taxonomy also helps to facilitate the communication, reporting, and aggregation of the risks. The other options are not the correct answers, because they are not essential for consolidating the risk registers. Risk response is the action taken to address the risk, which may vary depending on the risk level and strategy. Risk appetite is the amount and type of risk that an organization is willing to accept, which may differ across the organization’s units and functions. Risk ranking is the process of prioritizing the risks based on their impact and likelihood, which may change over time and context. References = CRISC Review Manual, 7th Edition, Chapter 2, Section 2.1.2, page 69.

The most important factor to communicate to senior management during the initial implementation of a risk management program is the desired risk level, which is the level of risk that the organization aims to achieve in order to fulfill its objectives and strategy1. The desired risk level can help to:

Define and communicate 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 objectives2.

Guide and align the risk identification, analysis, evaluation, and treatment processes, and ensure that the risks are consistent and proportional to the desired risk level3.

Measure and monitor the risk performance and outcome, and ensure that the actual risk level is within the desired risk level, or take corrective actions if needed4.

The other factors are not the most important to communicate to senior management, because:

Regulatory compliance is a necessary but not sufficient factor to communicate to senior management, as it ensures that the risk management program complies with the applicable laws, rules, or standards that govern the organization’s activities and operations5. However, regulatory compliance does not guarantee that the risk management program is relevant and useful for the organization’s specific objectives and strategy.

Risk ownership is a desirable but not essential factor to communicate to senior management, as it assigns the roles and responsibilities for managing the risks and implementing the risk responses to the appropriate individuals or entities within the organization. However, risk ownership does not ensure that the risk management program is effective and efficient in achieving the desired risk level.

Best practices are a useful but not critical factor to communicate to senior management, as they provide the guidelines and standards for designing and implementing the risk management program, based on the experience and knowledge of the industry or the profession. However, best practices do not ensure that the risk management program is suitable and feasible for the organization’s specific context and capabilities.

References =

Desired Risk Level - CIO Wiki

Risk Appetite and Tolerance - CIO Wiki

Risk Management Process - CIO Wiki

Risk Monitoring - CIO Wiki

Regulatory Compliance - CIO Wiki

[Risk Ownership - CIO Wiki]

[Best Practice - CIO Wiki]

[Risk Management - CIO Wiki]

 The performance of a client-facing application is the measure of how well the application meets the expectations and requirements of the clients who use it. The performance of a client-facing application can be affected by various factors, such as functionality, usability, reliability, availability, security, and scalability. Continuously monitoring the performance of a client-facing application is the process of collecting, analyzing, and reporting on the performance data and metrics of the application over time. Continuously monitoring the performance of a client-facing application can help identify and resolve issues, improve quality, optimize resources, and enhance client satisfaction. The most important thing to ensure when continuously monitoring the performance of a client-facing application is that the objectives are confirmed with the business owner. The business owner is the person or entity who has the authority and responsibility for the business value and outcomes of the application. The business owner defines the objectives, goals, and requirements of the application, and sets the performance criteria and targets. Confirming the objectives with the business owner can help ensure that the performance monitoring is aligned with the business needs and expectations, and that the performance data and metrics are relevant, accurate, and meaningful. References = Risk and Information SystemsControl Study Manual, Chapter 4: Risk and Control Monitoring and Reporting, Section 4.3: Continuous Monitoring, p. 203-205.

Externally sourced policies must be relevant and applicable to the organization's specific operations. Without operational applicability, policies offer little control value—even if they're up-to-date or legally compliant per ISACA practice domains.

The most important factor to identify when developing top-down risk scenarios is B. Business objectives12

Top-down risk scenarios are based on the organization’s strategic goals, objectives, and key performance indicators (KPIs), and they aim to identify the potential events or situations that could prevent or hinder the achievement of those goals and objectives12

By identifying the business objectives, the risk practitioner can align the risk scenarios with the organization’s mission, vision, and values, and ensure that the risk scenarios are relevant, realistic, and meaningful for the senior management and other stakeholders12

The other factors are not as important as the business objectives when developing top-down risk scenarios, because they are either more relevant for bottom-up risk scenarios (A and D), or they are derived from the business objectives and the risk scenarios ©12

The primary consideration when establishing an organization’s risk management methodology is the business context, which includes the internal and external factors that influence the organization’s objectives, strategies, scope, and boundaries. The business context helps to define the risk criteria, the risk appetite, the risk identification, the risk analysis, and the risk treatment. The other options are not the primary consideration, but rather the outcomes or inputs of the risk management methodology. References = ISO 31000 Risk Management – Principles andGuidelines; ISO 31000 Principles of Risk Management; The risk management process: What is the best structure and administration?

When selecting a risk response, the following should be considered:

B. Risk response costs

It’s important to evaluate the costs associated with implementing a risk response to ensure that they are justified by the benefits of mitigating the risk. This helps in making cost-effective decisions that align with the organization’s risk management objectives.

 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

An IT risk register is a document that records the identified IT risks, their analysis, and their responses. It is a useful tool for managing and communicating the IT risks throughout the project or the organization. The most important factor for maintaining the effectiveness of an IT risk register is to perform regular reviews and updates to the register, meaning that the riskpractitioner should periodically check and revise the riskregister to reflect the changes in the IT risk environment, the project status, or the organization’s objectives. Performing regular reviews and updates to the register can help to ensure that the risk register is accurate, complete, and current, and that it provides relevant and reliable information for the risk management decision making and actions. Performing regular reviews and updates to the register can also help to identify any new or emerging IT risks, as well as to monitor and report on the IT risk performance and improvement. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.2.1, p. 106-107

The risk practitioner’s most important responsibility in managing risk acceptance that exceeds risk tolerance is to verify authorization by senior management. Risk acceptance is a risk response strategy that involves acknowledging and agreeing to bear the risk and its potential consequences. Risk tolerance is the acceptable or allowable level of variation or deviation from the expected or desired outcomes or objectives. When the risk acceptance exceeds the risk tolerance, it means that the organization is taking on more risk than it can handle or afford. Therefore, the risk practitioner should verify that the risk acceptance is authorized by senior management, who have the authority and accountability for making risk management decisions and ensuring that they are aligned with the organizational strategy and objectives. The other options are not as important as verifying authorization by senior management, as they are related to the adjustments, conditions, or documentation of the risk acceptance, not the approval or validation of the risk acceptance. References = Risk and Information Systems Control Study Manual, Chapter 3: IT Risk Response, Section 3.2: IT Risk Response Options, page 133.

A business case will BEST communicate the importance of risk mitigation initiatives to senior management, because it provides a clear and concise justification of the objectives, benefits, costs, and risks of the proposed initiatives. A business case helps to align the risk mitigation initiatives with the enterprise’s strategy and goals, and to obtain the necessary approval and support from senior management. The other options are not as effective as a business case, because:

Option B: A balanced scorecard is a tool to measure and monitor the performance of the enterprise across four perspectives: financial, customer, internal process, and learning and growth. It does not communicate the importance of risk mitigation initiatives, but rather the outcomes and impacts of them.

Option C: Industry standards are benchmarks or best practices that define the minimum requirements or expectations for a certain domain or activity. They do not communicate the importance of risk mitigation initiatives, but rather the compliance or alignment of them with the external environment.

Option D: A heat map is a tool to visualize and prioritize the risks based on their likelihood and impact. It does not communicate the importance of risk mitigation initiatives, but rather the severity and distribution of the risks. References = Risk and Information Systems Control Study Manual, 7th Edition, ISACA, 2020, p. 118.

The potential scenario that presents the greatest risk to an organization when implementing a new database technology is that data may not be recoverable due to system failures. Data recovery is the process of restoring or retrieving data that has been lost, corrupted, or damaged due to system failures, such as hardware malfunctions, software errors, power outages, or natural disasters. Data recovery is essential for the continuity and integrity of the organization’s operations and information, as data is one of the most valuable and critical assets of the organization. Data recovery is also important for the compliance and accountability of the organization, as data may be subject to legal or regulatory requirements, such as retention, backup, or audit. Data recovery may be challenging or impossible when implementing a new database technology, because the new technology may not be compatible or interoperable with the existing systems, applications, or backups, or because the new technology may nothave adequate or tested recovery mechanisms or procedures. Data recovery may also be costly or time-consuming when implementing a new database technology, because the new technology may require additional or specialized resources, tools, or expertise, or because the new technology may involve large or complex data sets or structures. The other options are not as risky as data recovery, although they may also pose some difficulties or limitations for the new database technology implementation. The organization may not have a sufficient number of skilled resources, application and data migration cost for backups may exceed budget, and the database system may not be scalable in the future are all factors that could affect the feasibility and sustainability of the new database technology, but they do not directly affect the continuity and integrity of the organization’s operations and information. References = 2

Disaster Recovery (DR) focuses on restoring IT and business services to support essential operations after a disruption.

ISACA defines:

“The primary objective of disaster recovery is the timely restoration of critical IT systems and services necessary to support business operations.”

Recovery of financial records or facilities are secondary components.

Therefore, B. Restore critical business and IT services is correct.

CRISC Reference: Domain 3 – Risk Response and Mitigation, Topic: Business Continuity and Disaster Recovery Planning.

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.

For closed risks, documented proof that controls are in place and working (e.g., logs, test results) is vital. ISACA’s CRISC Manual emphasizes that evidence is required to validate control effectiveness and support audit requirements

According to the CRISC Review Manual1, a cable lock is a physical security device that attaches a laptop to a fixed object, such as a desk or a wall, to prevent unauthorized removal or theft. A cable lock is the best option to reduce the probability of laptop theft, as it acts as a deterrent and a barrier for potential thieves. A cable lock also helps to protect the confidentiality, integrity, andavailability of the data stored on the laptop, as well as the laptop itself. References = CRISC Review Manual1, page 253.

Without monitoring, ineffective or failing controls may go unnoticed, leading to ahigher likelihood of risk eventsmaterializing, potentially with severe impact. This outweighs audit or KPI concerns.

The business unit owner is accountable for authorizing application access in a SaaS environment because they are responsible for aligning access controls with business needs. They determine the roles and permissions needed to ensure operational effectiveness while adhering to the principle ofAccess Managementin the CRISC framework.

The next step for the risk practitioner when a key external technology supplier refuses to provide control design and effectiveness information is to review the supplier’s contractual obligations. The contract between the organization and the supplier should specify the terms and conditions for the provision of the service or function, including the requirements for control design and effectiveness information. By reviewing the contract, the risk practitioner can determine if the supplier is breaching the contract and take appropriate actions to enforce the contract or terminate the relationship. Escalating the non-cooperation to management, excluding applicable controls from the assessment, and requesting risk acceptance from the business process owner are other possible steps, but they are not as effective as reviewing the supplier’s contractual obligations. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 11; CRISC Review Manual, 6th Edition, page 144.

The most relevant source to reference when updating security awareness training materials is the recent security incidents reported by competitors. This can help to illustrate the real-world threats and consequences of poor security practices, and to motivate the employees to follow the security policies and procedures. Risk management framework, risk register, and global security standards are other sources that may be useful, but they are not as relevant as the recent security incidents. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 9; CRISC Review Manual, 6th Edition, page 214.

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.

Engaging key stakeholders in risk management practices is the best way to embed risk management within the organization. This means that the risk practitioner involves andcommunicates with the people who have an interest or influence in the organization’s objectives, activities, and risks, such as senior management, business unit managers, employees, customers, suppliers, regulators, etc.

Engaging key stakeholders in risk management practices helps to create a risk-aware culture, align risk management with the organization’s strategy and vision, ensure the ownership and accountability of risks and controls, obtain the support and commitment for risk management initiatives, and improve the risk management performance and outcomes.

The other options are not the best ways to embed risk management within the organization. They are either secondary or not essential for risk management.

The references for this answer are:

Risk IT Framework, page 17

Information Technology & Security, page 11

Risk Scenarios Starter Pack, page 9

 Computer-enabled fraud is the use of information technology (IT) to commit or conceal fraudulent activities, such as theft, manipulation, or unauthorized access of data, systems, or networks. Computer-enabled fraud can pose significant risks to an organization, such as financial loss, reputational damage, legal liability, or regulatory sanctions. Therefore, an organization should establish a comprehensive and effective framework to prevent, detect, and respond to computer-enabled fraud. The framework should involve three lines of defense, which are theroles and responsibilities of different functions within theorganization to manage and control risks. The first line of defense consists of the business owners, whose role is to identify, assess, and manage risks, including computer-enabled fraud risks. The primary responsibility of the first line of defense related to computer-enabled fraud is to implement processes to detect and deter fraud. This means designing and executing controls that can prevent or reduce the occurrence of computer-enabled fraud, such as authentication, authorization, encryption, logging, orsegregation of duties. This also means monitoring and reporting any suspicious or anomalous activities or transactions that may indicate computer-enabled fraud, such as unusual patterns, volumes, or frequencies of data or system access or usage. Implementing processes to detect and deter fraud can help the first line of defense to protect the organization’s assets, data, and reputation from computer-enabled fraud, and to comply with the organization’s policies and regulations. References = Three Lines of Defence, Roles of Three Lines of Defense for Information Security and Governance, THE THREE LINES OF DEFENSE IN EFFECTIVE RISK MANAGEMENT AND CONTROL, The Three Lines of Defense.

 Reduced ability to evaluate key risk indicators (KRIs) will have the greatest impact on the ability to monitor risk when an information system for a key business operation is moved from an in-house application to a Software as a Service (SaaS) vendor, as it may limit the visibility and control over the risk exposure and performance of the system. KRIs are metrics that measure the level of risk exposure and the effectiveness of risk response strategies, and they should be aligned with the enterprise’s risk appetite and objectives. When the system is moved to a SaaS vendor, the enterprise may lose access to the data and processes that are used to calculate and report the KRIs, or the KRIs may become irrelevant or inconsistent with the vendor’s environment and standards. This may impair the ability to monitor risk and to take timely and appropriate actions to manage risk. Reduced access to internal audit reports, dependency on the vendor’s key performance indicators (KPIs), and dependency on service level agreements (SLAs) are not the greatest impacts on the ability to monitor risk, as they do not affect the measurement and reporting of the risk status and performance, but rather the assurance and evaluation of the system quality and reliability. References = CRISC Certified in Risk andInformation Systems Control – Question221; ISACACertified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 221.

IT and business misalignment is the risk that the IT objectives, plans, and activities are not aligned with the business goals, needs, and expectations. This can result in wasted resources, missed opportunities, poor performance, and customer dissatisfaction. One of the best ways to mitigate this risk is to involve the business process owner in IT strategy. The business process owner is the person who has the authority and responsibility for a specific business process and its outcomes. By involving the business process owner in IT strategy, the organization can ensure that the IT initiatives and solutions are relevant, effective, and beneficial for the business process and its stakeholders. The business process owner can also provide valuable input, feedback, and support for the IT strategy and its implementation. The other options are not the best ways to mitigate the risk associated with IT and business misalignment, although they may be helpful and complementary. Establishing business key performance indicators (KPIs) is a technique to measure and monitor the achievement of business objectives and outcomes. However, KPIs do not necessarily ensure that the IT strategy is aligned with the business strategy or that the IT activities support the business activities. Introducing an established framework for IT architecture is a method to design and implement the IT infrastructure, systems, and services in a consistent and coherent manner. However, an IT architecture framework does not guarantee that the IT architecture is aligned with the business architecture or that the IT capabilities meet the business requirements. Establishing key risk indicators (KRIs) is a tool to monitor and communicate the level of exposure to a given risk or the potential impact of a risk. However, KRIs do not directly address the risk of IT and business misalignment or the actions needed to align them. References = CRISC Review Manual, pages 22-231; CRISC Review Questions, Answers & Explanations Manual, page 76

The organization control environment is most effective when the controls perform as intended. The controls are the mechanisms or measures that are designed and implemented to prevent, detect, or correct the risks that may affect the achievement of the objectives. The controls perform as intended when they provide reasonable assurance that the risks are mitigated or managed to an acceptable level, and that the objectives are met or exceeded. The performance of the controls can be measured and evaluated by using key performance indicators (KPIs) and key risk indicators (KRIs). The other options are not as indicative of the effectiveness of the control environment, as they are related to the review, implementation, or efficiency of the controls, not the performance or assurance of the controls. References = Risk and Information Systems Control Study Manual, Chapter 2: IT Risk Assessment, Section 2.3: IT Control Assessment, page 69.

Risk strategies are the plans and actions that an organization adopts to manage its risks and to achieve its objectives. Risk strategies should be aligned with the organization’s vision, mission, values, and culture, as well as its internal and external environment. The most important consideration when developing risk strategies is the long-term organizational goals, meaning that the risk strategies should support and enable the organization to pursue and attain its desired future state and outcomes. The long-term organizational goals should guide the risk identification, assessment, response, and monitoring processes, as well as the risk appetite and tolerance levels. The long-term organizational goals should also be communicated and cascaded throughout the organization to ensure the risk awareness and engagement of all stakeholders. References = Risk and Information Systems Control Study Manual, Chapter 1, Section 1.3.2, p. 27-28

The criticality of the asset is the most important factor to consider when determining the value of an asset during the risk identification process, because it reflects the importance or significance of the asset to the organization’s objectives or functions, and the potential impact or consequence of losing or compromising the asset. An asset is a resource or capability that has value to the organization, such as data, systems, applications, infrastructure, or people. The value of an asset is a measure of the worth or benefit of the asset to the organization, and the cost or loss of the asset to the organization. The risk identification process is a process of systematically identifying the sources and types of risk that an organization faces, and estimating their likelihood and impact. The criticality of the asset is the most important factor, as it helps to prioritize and focus on the assets that have the highest value and impact, and to determine the appropriate level of protection and investment for the assets. The monetary value of the asset, the vulnerability profile of the asset, and the size of the asset’s user base are all possible factors to consider when determining the value of an asset, but they are not the most important factor, as they do not directly reflect the criticality of the asset to the organization’s objectives or functions. References = Risk and Information Systems Control Study Manual, Chapter 3, Section 3.2.1, page 83