Isaca CRISC - Certified in Risk and Information Systems Control

The best input for conducting a review of emerging risk is the annual threat reports. Emerging risk is the risk that arises from new or evolving sources, or from existing sources that have not been previously considered or recognized. Emerging risk may have significant impact on the organization’s objectives, strategies, operations, or reputation, and may require new or different risk responses. Annual threat reports are the reports that provide information and analysis on the current and future trends, developments, and challenges in the threat landscape, such as cyberattacks, natural disasters, geopolitical conflicts, or pandemics. Annual threat reports can help to identify and assess the emerging risk, as they can provide insights into the sources, drivers, indicators, and scenarios of the emerging risk, as well as the potential impact and likelihood of the emerging risk. Annual threat reports can also help to benchmark and compare the organization’s risk exposure and preparedness with the industry and the peers, and to prioritize and respond to the emerging risk. Audit reports, industry benchmarks, and financial forecasts are not as useful as annual threat reports, as they do not focus on the emerging risk, and may not capture the latest or future changes in the threat landscape. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 50.

Mapping granular scenarios to high-level register items ensures consistency and alignment across different levels of risk management. This approach supportsIntegrated Risk Management Frameworks.

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

 A vulnerability is a weakness or flaw that can be exploited by a threat to cause harm or damage to an asset. Employees holding the door open for others, so that trailing employees do not have to stop and swipe their own ID badges, is a behavior that best represents a vulnerability, as itbypasses the security control of the ID badge system, and allows unauthorized or unauthenticated access to the premises. This behavior can increase the risk of physical or logical security breaches, such as theft, vandalism, sabotage, or espionage. References = CRISC: Certified in Risk & Information Systems Control Sample Questions, Question 258. Most Asked CRISC Exam Questions and Answers, Question 10. ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, Question 258. CRISC by Isaca Actual Free Exam Q&As, Question 9.

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.

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.

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 most important factor when identifying an organization’s risk exposure associated with IoT devices is visibility into all networked devices. This means having a comprehensive inventory of all the IoT devices connected to the organization’s network, as well as their configurations, functions, and security status. Visibility enables the organization to identify the potential threats and vulnerabilities that IoT devices pose, as well as the impact and likelihood of those risks. Visibility also helps the organization to monitor the behavior and performance of IoT devices, detect any anomalies or incidents, and respond accordingly. Without visibility, the organization may be unaware of the existence, location, or condition of some IoT devices, which could lead to undetected breaches, data loss, or operational disruptions. References = Risk and Information Systems Control Study Manual, Chapter 1: IT Risk Identification, Section 1.4: IT Risk Identification Methods and Techniques, Page 28; 8 Internet of Things Threats and Risks to Be Aware of - SecurityScorecard Blog.

 According to the CRISC Review Manual (Digital Version), the main reason to continuously monitor IT-related risk is to ensure risk levels are within acceptable limits of the organization’srisk appetite and risk tolerance. The risk appetite is the amount and type of risk that an organization is willing to accept in pursuit of its objectives, while the risk tolerance is the acceptable variation in outcomes related to specific performance measures linked to objectives. Continuous monitoring is a process that tracks the security state of an information system on an ongoing basis and maintains the security authorization for the system over time. Continuous monitoring helps to:

Provide ongoing assurance that the implemented security controls are operating effectively and efficiently

Detect changes in the risk profile of the information system and the environment of operation

Identify new or emerging threats and vulnerabilities that may affect the information system

Support risk-based decisions by providing timely and relevant risk information to stakeholders

Facilitate the implementation of corrective actions and risk mitigation strategies

Promote accountability and transparency in the risk management process

Enhance the security awareness and culture within the organization

References = CRISC Review Manual (Digital Version), Chapter 4: IT Risk Monitoring and Reporting, Section 4.1: IT Risk Monitoring, pp. 213-2141

First-hand direct observation of the controls in operation is the best way to confirm the existence and operating effectiveness of information systems controls because it provides the auditor with the most reliable and persuasive evidence. Direct observation involves inspecting the physicaland logical aspects of the controls, such as the hardware, software, network, data, procedures, and personnel involved in the information systems. Direct observation also allows the auditor to verify that the controls are functioning as intended, and to identify any deviations or weaknesses that may affect the reliability of the information systems. Direct observation can be performed by using various techniques, such as walkthroughs, inquiries, inspections, reperformance, and analytical procedures1. References = Auditing Standard No. 13, The Auditor’s Responses to the Risks of Material Misstatement, PCAOB, 20101

The key to controlling escalating costs when an organization is having new software implemented under contract is change management, which is the process of identifying, evaluating, approving, and implementing changes to the project scope, schedule, budget, or quality1. Change management can help to control escalating costs by:

Establishing a clear and agreed-upon baseline for the project deliverables, requirements, and expectations, and ensuring that they are aligned with the contract terms and conditions2.

Defining and enforcing a formal and consistent change control process, which includes the roles and responsibilities, the criteria and methods, and the documentation and communication of the changes3.

Assessing and prioritizing the proposed changes, and determining their impact and feasibility, and their alignment with the project objectives and constraints4.

Obtaining the approval and authorization of the relevant stakeholders, such as the project sponsor, the project manager, the contractor, or the customer, before implementing the changes5.

Monitoring and measuring the performance and outcome of the changes, and ensuring that they are delivered within the agreed scope, schedule, budget, and quality6.

References =

Change Management - CIO Wiki

Project Scope Management - CIO Wiki

Change Control - CIO Wiki

Change Impact Analysis - CIO Wiki

Change Approval - CIO Wiki

Change Evaluation - CIO Wiki

Regulatory restrictions for cross-border data transfer can significantly impact compliance, making this the most critical consideration. Addressing such restrictions ensures adherence toLegal and Regulatory Requirementsin risk management.

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.

The data owner should be accountable for ensuring that media containing financial information are adequately destroyed per an organization’s data disposal policy, as they have the authority and responsibility to define the classification, retention, and disposal requirements for the data they own. The compliance manager, the data architect, and the chief information officer (CIO) are not the best choices, as they have different roles and responsibilities related to data governance, design, and strategy, respectively, but they do not own the data. References = CRISC Review Manual, 7th Edition, page 154.

The main purpose of monitoring risk is to provide decision support for the organization. Risk monitoring is the process of tracking and reviewing the risk management activities, the risk profile, and the risk performance of the organization. By monitoring risk, the organization can obtain timely and relevant information and feedback on the risk situation, and use it to make informed and effective decisions on risk management and business objectives. Communication, risk analysis, and benchmarking are other possible purposes of risk monitoring, but they are not as important as decision support. References = ISACA Certified in Risk and Information Systems Control (CRISC) Certification Exam Question and Answers, question 12; CRISC Review Manual, 6th Edition, page 215.

ï‚· Understanding Strategic Risk:

Strategic risk refers to the potential losses that can arise from adverse business decisions, improper implementation of decisions, or lack of responsiveness to changes in the business environment.

ï‚· Reputational Impact of Cybersecurity Breaches:

A cybersecurity breach can severely damage an organization's reputation, affecting customer trust, investor confidence, and market value.

Such impacts go beyond immediate financial losses and can have long-term strategic implications for the organization's competitive position and strategic objectives.

ï‚· Classification of Risk:

Financial Risk:Direct financial losses due to a breach (e.g., fines, legal costs) but does not cover reputational impacts.

Data Risk:Focuses on the loss or compromise of data but not the broader strategic impact.

Operational Risk:Pertains to disruptions in business operations, while reputational damage influences the organization’s strategic direction and goals.

ï‚· Strategic Risk and Reputation:

Reputational damage from a cybersecurity breach can lead to a loss of customer base, reduced market share, and difficulties in strategic partnerships, all of which are strategic concerns.

Addressing reputational risk requires strategic planning, proactive communication, and long-term efforts to rebuild trust and credibility.

ï‚· References:

The CRISC Review Manual highlights that reputational risk is a significant aspect of strategic risk, especially following cybersecurity incidents (CRISC Review Manual, Chapter 1: Governance, Section 1.1.3 Importance and Value of IT Risk Management)​​.

The best tool to support the management of identified risk scenarios is maintaining a risk register, as it provides a comprehensive and structured record of the risk information and decisions, such as the risk description, rating, ownership, response, and status, and facilitates the communication and accountability of the risk management process and activities. The other options are not the best tools, as they are more related to the collection, measurement, or definition of the risk scenarios, respectively, rather than the management of the risk scenarios. References = CRISC Review Manual, 7th Edition, page 101.

 The results of risk analyses should be presented in quantitative or qualitative terms based primarily on the requirements of management, because they are the intended audience and users of the risk information, and they have the authority and responsibility to make risk-based decisions. The requirements of management may vary depending on the purpose, scope, and context of the risk analysis, and the level of detail, accuracy, and reliability that they need. Quantitative risk analysis uses numerical data and mathematical models to estimate theprobability and impact of risks, and to express the risk exposure and value in monetary or other measurable units. Qualitative risk analysis uses descriptive data and subjective judgmentsto assess the likelihood and severity of risks, and to rank the risks according to their relative importance or priority. Both methods have their advantages and disadvantages, and they can be used separately or together, depending on the situation and the availability of data and resources. However, the primary factor that determines the choice of the method is the requirements of management, as they are the ones who will use the risk information to support their objectives, strategies, and actions. References = Risk IT Framework, ISACA, 2022, p. 141