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Free ISACA CRISC Exam Questions (page: 4)

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PDF with 1895 Questions

Which of the following would present the GREATEST challenge for a risk practitioner during a merger of two organizations?

  1. Variances between organizational risk appetites
  2. Different taxonomies to categorize risk scenarios
  3. Disparate platforms for governance, risk, and compliance (GRC) systems
  4. Dissimilar organizational risk acceptance protocols

Answer(s): A

Explanation:

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.



Which of the following is the MOST important for an organization to have in place to ensure IT asset protection?

  1. Procedures for risk assessments on IT assets
  2. AnIT asset management checklist
  3. An IT asset inventory populated by an automated scanning tool
  4. A plan that includes processes for the recovery of IT assets

Answer(s): A

Explanation:

To ensure IT asset protection, having procedures for risk assessments on IT assets is the most important. These procedures enable an organization to systematically identify, evaluate, and mitigate risks associated with its IT assets. This process is crucial for understanding thevulnerabilities and threats that could potentially harm the assets and for implementing the necessary controls to protect them.

Procedures for Risk Assessments on IT Assets (Answer A):
Importance: Regular risk assessments help in identifying vulnerabilities and threats to IT assets, allowing the organization to prioritize and implement appropriate risk mitigation strategies.
Implementation: These procedures should be well-documented and regularly updated to reflect the changing threat landscape and the organization's evolving IT infrastructure. Outcome: Effective risk assessments ensure that IT assets are protected from potential risks, thereby safeguarding the organization's data, systems, and overall IT environment.
Comparison with Other Options:
B . An IT asset management checklist:

Purpose: This helps in tracking and managing IT assets. Limitation: It does not address risk assessment and mitigation directly. C . An IT asset inventory populated by an automated scanning tool:
Purpose: Provides a detailed list of IT assets.
Limitation: While it helps in knowing what assets exist, it does not assess the risks associated with those assets.
D . A plan that includes processes for the recovery of IT assets:
Purpose: Focuses on recovery after an incident.
Limitation: It is reactive rather than proactive in protecting assets.


Reference:

ISACA CRISC Review Manual, Chapter 2, "IT Risk Assessment", which emphasizes the need for systematic risk assessments to manage and protect IT assets effectively.



Which of the following is the MOST reliable validation of a new control?

  1. Approval of the control by senior management
  2. Complete and accurate documentation of control objectives
  3. Control owner attestation of control effectiveness
  4. Internal audit review of control design

Answer(s): D

Explanation:

Internal Audit Review:
An internal audit review of control design involves a thorough examination of the control's structure, implementation, and effectiveness.
Auditors use a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.
Steps in Audit Review:

Understand Control Objectives:Auditors ensure that the control is designed to meet specific risk management objectives.
Evaluate Implementation:Check whether the control has been implemented as designed. Test Effectiveness:Perform tests to verify that the control operates effectively and consistently over time.
Importance of Audit Review:
Provides independent and objective assurance that the control is appropriately designed and functioning as intended.
Identifies any deficiencies or areas for improvement in the control design.
Comparing Other Validation Methods:

Senior Management Approval:Indicates support but does not validate effectiveness. Documentation of Control Objectives:Important for understanding intent but not validation. Control Owner Attestation:Provides insight but lacks the independence of an audit.


Reference:

The CRISC Review Manual highlights the role of internal audits in validating control design and ensuring effective risk management (CRISC Review Manual, Chapter 3: Risk Response and Mitigation, Section 3.9 Control Testing and Effectiveness Evaluation) .



After conducting a risk assessment for regulatory compliance, an organization has identified only one possible mitigating control. The cost of the control has been determined to be higher than the penalty of noncompliance.
Which of the following would be the risk practitioner's BEST recommendation?

  1. Accept the risk with management sign-off.
  2. Ignore the risk until the regulatory body conducts a compliance check.
  3. Mitigate the risk with the identified control.
  4. Transfer the risk by buying insurance.

Answer(s): A

Explanation:

·Risk acceptance is a status quo risk response, where the risk owner acknowledges the risk exists but accepts it with minimal response1. Risk acceptance may be appropriate when the cost of other risk responses exceeds the value that would be gained, or when the risk is below the risk acceptance criteria2.
·Risk acceptance criteria are the criteria used as a basis for decisions about acceptable risk2. They should be established before conducting a risk assessment, and they may be influenced by factors such as utility, equality, technology, and risk perception2. Different organizations and countries may have different risk acceptance criteria, depending on their context and values3.
·In this scenario, the organization has conducted a risk assessment for regulatory compliance, and has identified only one possible mitigating control. However, the cost of the control is higher than the penalty of noncompliance, which implies that the risk is below the risk acceptancecriteria. Therefore, the best recommendation is to accept the risk with management sign-off, which means that the management agrees to take the risk and is accountable for the consequences.
·Ignoring the risk until the regulatory body conducts a compliance check (option B) is not a good recommendation, as it may expose the organization to legal, financial, or reputational damage. Moreover, ignoring the risk may violate the principle of risk reduction, which states that risks should be reduced wherever practicable2. ·Mitigating the risk with the identified control (option C) is not a good recommendation, as it may not be cost-effective or efficient for the organization. The cost of the control is higher than the penalty ofnoncompliance, which means that the organization would spend more resources than necessary to reduce the risk. Moreover, mitigating the risk may not be aligned with the principle of utility, which states that resources should be used as efficiently as possible for the society as a whole2.
·Transferring the risk by buying insurance (option D) is not a good recommendation, as it may not be feasible or beneficial for the organization. Transferring the risk means that the organization shifts the responsibility or burden of the risk to another party, such as an insurer, a contractor, or a partner1. However, transferring the risk does not eliminate the risk, and it may incur additional costs or complications for the organization. Moreover, transferring the risk may not be possible or acceptable for some types of regulatory compliance risks, such as those related to health, safety, or environmental standards3.


Reference:

·Compliance risk assessments - Deloitte United States ·Compliance Risk Assessment [5 Key Steps] | Hyperproof ·Compliance Risk Assessments | Deloitte US
·Risk Acceptance Criteria: Overview of ALARP and Similar Methodologies as Practiced Worldwide
·Risk Assessment 4. Risk acceptance criteria - Norwegian University of Science and Technology
·Risk Acceptance - Institute of Internal Auditors



Which type of indicators should be developed to measure the effectiveness of an organization's firewall rule set?

  1. Key risk indicators (KRIs)
  2. Key management indicators (KMIs)
  3. Key performance indicators (KPIs)
  4. Key control indicators (KCIs)

Answer(s): D

Explanation:

The best type of indicators to measure the effectiveness of an organization's firewall rule set are key control indicators (KCIs). A firewall is a device or software that filters the network traffic based on a set of rules or policies. A firewall rule set is the configuration of the firewall that defines the criteria for allowing or blocking the traffic. A key control indicator is a metric that measures the performance and effectiveness of a control in achieving its objectives and mitigating the risks. A key control indicator can help to evaluate the adequacy and efficiency of the firewall rule set, and to identify any gaps, weaknesses, or issues that need to be addressed.Key risk indicators (KRIs), key management indicators (KMIs), and key performance indicators (KPIs) are not as suitable as key control indicators, as they measure different aspects of the risk management process, such as the level and nature of the risk exposure, the alignment and integration of the risk management activities, and the achievement of the risk management goals and targets. References = CRISC Review Manual, 6th Edition, ISACA, 2015, page 220.



The MOST effective way to increase the likelihood that risk responses will be implemented is to:

  1. create an action plan
  2. assign ownership
  3. review progress reports
  4. perform regular audits.

Answer(s): B

Explanation:

Risk responses are the actions or strategies that are taken to address the risks that may affect the organization's objectives, performance, or value creation12. The most effective way to increase the likelihood that risk responses will be implemented is to assign ownership, which is the process of identifying and appointing the individuals or groups who are responsible and accountable for the execution and monitoring of the risk responses34.

Assigning ownership is the most effective way because it ensures the clarity and commitment of the roles and responsibilities for the risk responses, and avoids the confusion or ambiguity that may arise from the lack of ownership34.
Assigning ownership is also the most effective way because it enhances the communication and collaboration among the stakeholders involved in the risk responses, and provides the feedback and input that are necessary for the improvement and optimization of the risk responses34.
The other options are not the most effective way, but rather possible steps or tools that may support or complement the assignment of ownership. For example:
Creating an action plan is a step that involves defining and documenting the specific tasks,

resources, timelines, and deliverables for the risk responses34. However, this step is not the most effective way because it does not guarantee the implementation of the risk responses, especially if there is no clear or agreed ownership for the action plan34. Reviewing progress reports is a tool that involves collecting and analyzing the information and data on the status and performance of the risk responses, and identifying the issues or gaps that need to be addressed34. However, this tool is not the most effective way because it does not ensure the implementation of the risk responses, especially if there is no ownership for the progress reports or the corrective actions34. Performing regular audits is a tool that involves conducting an independent and objective assessment of the adequacy and effectiveness of the risk responses, and providing the findings and recommendations for improvement56. However, this tool is not the most effective way because it does not ensure the implementation of the risk responses,especially if there is no ownership for the audit results or the follow-up actions56. References =
1: Risk IT Framework, ISACA, 2009
2: IT Risk Management Framework, University of Toronto, 2017
3: Risk Response Plan in Project Management: Key Strategies & Tips1
4: ProjectManagement.com - How to Implement Risk Responses2
5: IT Audit and Assurance Standards, ISACA, 2014
6: IT Audit and Assurance Guidelines, ISACA, 2014



When an organization's disaster recovery plan (DRP) has a reciprocal agreement, which of the following risk treatment options is being applied?

  1. Acceptance
  2. Mitigation
  3. Transfer
  4. Avoidance

Answer(s): C

Explanation:

A reciprocal agreement is an agreement made by two or more organizations to use each other's resources during a disaster1. For example, two organizations with similar IT infrastructure may agree to provide backup servers or data centers for each other in case of a major disruption. By doing so, they transfer the risk of losing their IT capabilities to the other party, who agrees to share the responsibility and cost of recovery. A reciprocal agreement is a form of risk transfer, which is one of the four risk treatment options according to ISO 270012. Risk transfer means that the organization shifts the potential negative consequences of a risk to another party, such as an insurance company, a vendor, or a partner. This reduces the organization's exposure and liability to the risk, but it does not eliminate the risk completely, as the other party may fail to fulfill their obligations or charge a high price for their services.
References = Reciprocal Agreement - Risky Thinking, ISO 27001 Risk Assessment & Risk Treatment: The Complete Guide - Advisera



Which of the following is the GREATEST risk associated with the misclassification of data?

  1. inadequate resource allocation
  2. Data disruption
  3. Unauthorized access
  4. Inadequate retention schedules

Answer(s): C

Explanation:

According to the CRISC Review Manual, the greatest risk associated with the misclassification of data is unauthorized access, because it can result in the loss of confidentiality, integrity, and availability of the data. Data classification is the process of assigning categories to data based on its sensitivity and value to the organization. Data classification helps to determine the appropriate level of protection and handling for the data. If the data is misclassified, it may not receive the adequate level of security controls, and it may be accessed by unauthorized or inappropriate users. The other options are not the greatest risks associated with the misclassification of data, as they are less likely or less severe than unauthorized access. Inadequate resource allocation is the risk of not allocating sufficient resources to protect the data, which may affect its availability and performance. Data disruption is the risk of losing or corrupting the data, which may affect its integrity and availability. Inadequate retention schedules is the risk of not retaining the data forthe required period of time, which may affect its compliance and usability. References = CRISC Review

Manual, 7th Edition, Chapter 4, Section 4.1.1, page 161.



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