What is residual risk in RM?

Master Risk Management for Small Unit Leaders by tackling flashcards and multiple choice questions. Each question includes detailed explanations, enhancing your preparedness for the real exam!

Multiple Choice

What is residual risk in RM?

Explanation:
Residual risk is the amount of risk that remains after you have implemented all planned controls to mitigate a risk. It shows how effective your safeguards are and what the organization still faces once mitigation steps are in place. This remaining risk is what you compare to the organization's risk tolerance to decide if further action is needed. It’s not the risk you start with before controls (that’s the inherent or baseline risk), nor the risk after just one control, and it isn’t necessarily “unmitigatable”—it’s simply what’s left after applying the intended controls.

Residual risk is the amount of risk that remains after you have implemented all planned controls to mitigate a risk. It shows how effective your safeguards are and what the organization still faces once mitigation steps are in place. This remaining risk is what you compare to the organization's risk tolerance to decide if further action is needed. It’s not the risk you start with before controls (that’s the inherent or baseline risk), nor the risk after just one control, and it isn’t necessarily “unmitigatable”—it’s simply what’s left after applying the intended controls.

Subscribe

Get the latest from Passetra

You can unsubscribe at any time. Read our privacy policy