Following an IT audit, management has decided to accept the risk highlighted in the audit report.
Which of the following would provide the MOST assurance to the IS auditor that management is adequately balancing the needs of the business with the need to manage risk?
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A. B. C. D.A.
The IS auditor's main objective is to provide assurance that the organization's management is balancing the needs of the business with the need to manage risk. When management has decided to accept the risk highlighted in the audit report, the IS auditor needs to ensure that adequate controls are in place to manage the identified risk.
Out of the four options provided, the one that would provide the most assurance to the IS auditor that management is adequately balancing the needs of the business with the need to manage risk is option A, "Established criteria exist for accepting and approving risk."
Option A indicates that there are established criteria in place for evaluating and approving risks. This means that management has a structured approach for identifying, assessing, and managing risks based on predefined criteria that have been agreed upon by relevant stakeholders. This approach ensures that risks are evaluated consistently and objectively, and that the risks that are accepted align with the organization's risk appetite and overall strategy.
Options B, C, and D are all important components of risk management, but they do not provide the same level of assurance as option A.
Option B, "Identified risk is reported into the organization's risk committee," is important because it ensures that risks are communicated to the appropriate parties for review and action. However, it does not provide assurance that there is a structured approach to evaluating and approving risks.
Option C, "Potential impact and likelihood is adequately documented," is also important, as it helps ensure that risks are properly assessed and evaluated. However, documentation alone does not ensure that there is a structured approach to accepting and approving risks.
Option D, "A communication plan exists for informing parties impacted by the risk," is important for ensuring that risks are properly communicated to relevant stakeholders. However, it does not provide assurance that there is a structured approach to evaluating and approving risks.
In conclusion, the option that would provide the most assurance to the IS auditor that management is adequately balancing the needs of the business with the need to manage risk is option A, "Established criteria exist for accepting and approving risk."