Which of the following is NOT true for Key Risk Indicators?
Correct Answer: D
Explanation/Reference: Explanation: They are monitored on regular basis as they indicate high probability and high impact risks. As risks change over time, hence KRIs should also be monitored regularly for its effectiveness on these changing risks. Incorrect Answers: A, B, C: These all are true for KRIs. Key Risk Indicators are the prime monitoring indicators of the enterprise. KRIs are highly relevant and possess a high probability of predicting or indicating important risk. KRIs help in avoiding excessively large number of risk indicators to manage and report that a large enterprise may have. The complete set of KRIs should also balance indicators for risk, root causes and business impact, so as to indicate the risk and its impact completely.
Question 192
Which of the following is the MOST important data source for monitoring key risk indicators (KRIs)?
Correct Answer: A
Question 193
You are the project manager of the QPS project. You and your project team have identified a pure risk. You along with the key stakeholders, decided to remove the pure risk from the project by changing the project plan altogether. What is a pure risk?
Correct Answer: A
Section: Volume C Explanation: A pure risk has only a negative effect on the project. Pure risks are activities that are dangerous to complete and manage such as construction, electrical work, or manufacturing. It is a class of risk in which loss is the only probable result and there is no positive result. Pure risk is associated to the events that are outside the risk-taker's control. Incorrect Answers: B: The risk event created by the application of risk response is called secondary risk. C: A risk event that is generated due to errors or omission in the project work is not necessarily pure risk. D: This in not valid definition of pure risk.
Question 194
Which of the following is MOST helpful in determining the effectiveness of an organization's IT risk mitigation efforts?
Correct Answer: D
Question 195
Which of the following statements are true for risk communication? Each correct answer represents a complete solution. Choose three.
Correct Answer: A,C,D
Section: Volume B Explanation: Risk communication is the process of exchanging information and views about risks among stakeholders, such as groups, individuals, and institutions. Risk communication is mostly concerned with the nature of risk or expressing concerns, views, or reactions to risk managers or institutional bodies for risk management. The key plan to consider and communicate risk is to categorize and impose priorities, and acquire suitable measures to reduce risks. It is important throughout any crisis to put across multifaceted information in a simple and clear manner. Risk communication helps in switching or allocating the information concerning risk among the decision-maker and the stakeholders. Risk communication can be explained more clearly with the help of the following definitions: * It defines the issue of what a group does, not just what it says. * It must take into account the valuable element in user's perceptions of risk. * It will be more valuable if it is thought of as conversation, not instruction. Risk communication is a fundamental and continuing element of the risk analysis exercise, and the involvement of the stakeholder group is from the beginning. It makes the stakeholders conscious of the process at each phase of the risk assessment. It helps to guarantee that the restrictions, outcomes, consequence, logic, and risk assessment are undoubtedly understood by all the stakeholders. Incorrect Answers: B: It helps in allocating the information concerning risk not only among the decision-makers but also stakeholders.
