CRISC Question 302

Community Discussion

Written by other learners. Comments can disagree with the marked answer — check the official documentation when in doubt.

• Chose A1

  A. The enterprise's capacity to absorb loss. An element of the risk appetite of an organization should include the enterprise's capacity to absorb loss. Risk appetite refers to the level of risk an organization is willing to accept in pursuit of its objectives. This includes an understanding of the organization's financial strength, resources, and ability to withstand and recover from potential losses. While the other options (effectiveness of compensating controls, amount of inherent risk, residual risk affected by preventive controls) are relevant aspects of risk management, they are not typically considered elements of risk appetite. Risk appetite focuses on the organization's overall tolerance for risk, considering factors such as financial resilience and the impact of potential losses on its operations and goals.

• Chose C1

  This question seems to be testing knowledge of risk capacity versus risk appetite. A would be tied to risk capacity whereas C fits risk appetite better.

• 1

  A Many factors are usually at play when making decisions about risk appetite, including internal factors and external factors. Internal factors: Long-term objectives Stage in the organizational life cycle Financial stability Risk capacity