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Risk & Compliance · Question Set
Risk Management interview questions for placements and exams.
Questions
14
Included in this set
Subject
Risk & Compliance
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Difficulty
Mixed
Level of this set
Go through each question and its explanation. Use this set as a focused practice pack for Risk & Compliance .
Cybersecurity risk is usually expressed as the combination of a threat, a vulnerability, and the potential impact. It represents the possibility that a threat will exploit a weakness and cause damage. The higher the likelihood or impact, the greater the overall risk.
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Risk appetite describes how much uncertainty or potential loss a company is willing to tolerate in pursuit of its objectives. Some organizations take more risk for innovation or speed, while others prefer caution and tight control. It guides decisions about which risks to mitigate and which to accept.
Residual risk is the portion of risk that still exists after security measures are in place. No control completely removes risk, so organizations must decide if the remaining level is acceptable or needs further treatment.
Administrative controls involve policies, procedures, and training. Technical controls are mechanisms like firewalls, encryption, and access management. Physical controls are barriers such as locks, cameras, and security guards. Together, they form layers of protection around assets.
Mitigation means applying security measures to minimize how likely a threat is to occur or how much damage it could cause. Examples include installing patches, enabling multi-factor authentication, or improving monitoring to detect attacks earlier.
Organizations can avoid, transfer, mitigate, or accept risks. Avoiding removes the exposure completely, transferring moves it elsewhere such as through insurance or outsourcing, and accepting means acknowledging it as tolerable. Amplifying risk is not a valid strategy.
Risk is commonly assessed based on how likely an event is to happen and how severe its consequences would be. A high-likelihood, high-impact scenario is treated as a top priority for mitigation.
A risk matrix, also called a heat map, shows risks visually based on their likelihood and impact. It helps decision-makers focus on the most critical areas that need attention or resources.
Key Risk Indicators are measurable metrics that show early signs of potential problems. Examples include the number of critical vulnerabilities, time to patch, or number of failed login attempts. KRIs help organizations detect changes in risk levels and act before incidents occur.
Cybersecurity risks are owned by the business or process owners because they understand how those risks affect operations and objectives. The security team advises and supports, but final accountability rests with those responsible for the business outcome. This ensures that risk decisions align with organizational priorities.
Risks should be presented in clear, business-oriented language that highlights potential impact on operations, reputation, or finances. Charts or heat maps help visualize priorities. Communication should focus on the overall risk posture, major changes, and the effectiveness of existing controls, allowing leadership to make informed decisions.
Qualitative analysis uses expert opinion and descriptive scales such as low, medium, or high to rate risks. Quantitative analysis converts risks into numbers, often in terms of cost or probability. Both approaches aim to prioritize what needs attention first, but one is subjective and the other is data-driven.
A risk register is a detailed record that lists all identified risks, their descriptions, likelihood, impact, control measures, and assigned owners. It keeps track of the status of each risk and helps ensure accountability. The register acts as a central tool for monitoring and communicating risk throughout the organization.
The risk lifecycle starts with identifying possible threats and vulnerabilities. It continues with analyzing and evaluating how likely they are and what their consequences could be. Then, appropriate controls are chosen to treat or reduce the risk. Finally, the organization monitors and reviews these risks regularly to adapt to new threats or changes in systems.