Risk/Risk Management

Question 1

The effect of uncertainty on objectives.

Answer 1

Risk

Question 2

Coordinated activities to direct and control an organization with regard to risk.

Answer 2

Risk Management

Question 3

Events that are to be expected and so involve little uncertainty.

Answer 3

Known Knowns

Question 4

Uncertainties that we know exist but we don’t know much about their probability or impact.

Answer 4

Known Unknowns

Question 5

Risks that we don’t know exist.

Answer 5

Unknown Unknowns

Question 6

Come from within the organization and could include violations of ethics and failures in routine processes.

Answer 6

Internal & Preventable

Question 7

Desirable uncertainty that an organization willingly accepts when it commits to a strategy.

Answer 7

Strategy

Question 8

Sources of uncertainty are outside the organization and beyond its control. The would include changes in the economy or laws and regulations, disruptive technologies, and availability of trained employees.

Answer 8

External

Question 9

Risks that affect the organization’s ability to achieve its objectives. (ERM Framework)

Answer 9

Strategy

Question 10

Risks that affect the myriad ways in which the organization creates value. (ERM Framework)

Answer 10

Operations

Question 11

Risks that affect the accuracy and timeliness of information about the organization’s financial performance and condition. (ERM Framework)

Answer 11

Financial Reporting

Question 12

Risks associated with meeting the requirements of laws and regulations. (ERM Framework)

Answer 12

Compliance

Question 13

An action taken to manage a risk.

Answer 13

Risk Control

Question 14

The decision not to become involved in or action to withdraw from a risk situation.

Answer 14

Avoidance

Question 15

The actions taken to lessen the probability, negative consequence, or both associated with a risk.

Answer 15

Reduction

Question 16

Sharing with another party the burden of loss or benefit of gain for a risk. Can be done through insurance or other agreements. It can create new risks or modify existing risks. Relocation of the source of risk is not risk sharing. In some situations, legal, mandatory, or statutory rights can limit, prohibit, or mandate the sharing of certain risks.

Answer 16

Sharing

Question 17

The acceptance of the burden of loss or benefit of gain for a risk.

Answer 17

Retention

Question 18

The amount of uncertainty that remains after all risk management efforts have been exhausted.

Answer 18

Residual Risk

Question 19

The reporting of an organization’s violations of policies and processes by employees, applies directly to risk management.

Answer 19

Whistleblowing

Question 20

A protocol that an organization implements when an identified risk event occurs.

Answer 20

contingency plan