Prime Monitoring Indicators

A.

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.

Incorrect Answers: B: Lag indicators are the risk indicators that is used to indicate risk after events have occurred.

C: Lead indicators are the risk indicators that is used to indicate which capabilities are in place to prevent events from occurring.

D: Risk indicators are metrics used to indicate risk thresholds, i.e., it gives indication when a risk level is approaching a high or unacceptable level of risk.

The main objective of a risk indicator is to ensure tracking and reporting mechanisms that alert staff about the potential risks.

The term described in the statement is "Key Risk Indicators" or KRIs.

KRIs are metrics that organizations use to monitor and measure the potential impact of risks on their objectives. They are designed to help identify, assess, and mitigate risks before they become significant problems.

KRIs are considered "key" because they are the most important indicators of an organization's risk profile. They are also relevant and possess a high probability of predicting or indicating important risks.

KRIs can be both lagging and leading indicators, depending on the type of risk being monitored. Lagging indicators look at past performance and can indicate whether a risk has already occurred. Leading indicators, on the other hand, look at current conditions and trends and can predict whether a risk is likely to occur in the future.

Overall, KRIs play a critical role in an organization's risk management strategy by providing early warning signs of potential risks and allowing for proactive mitigation measures to be taken.