Risk Identification & Assessment Techniques Flashcards
7 cards from real CRA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Risk Identification & Assessment Techniques flashcards as text
A company uses historical loss data to estimate future risk exposures. Which quantitative technique does this best describe?
Answer: Actuarial analysis
Actuarial analysis uses historical loss data and statistical models to estimate the frequency and severity of future risk events, common in insurance and financial risk.
In risk assessment, 'velocity' refers to:
Answer: How quickly a risk can impact the organization after it materializes
Velocity measures how rapidly a risk transitions from occurrence to impact, helping prioritize risks that leave little time for response.
Which diagram maps out all possible causes of a risk event in a fishbone or Ishikawa structure?
Answer: Cause-and-effect diagram
A cause-and-effect (Ishikawa/fishbone) diagram visually maps potential root causes contributing to a risk event across categories like people, process, and technology.
FMEA (Failure Mode and Effects Analysis) calculates a Risk Priority Number (RPN) by multiplying which three factors?
Answer: Severity, Occurrence, and Detection
FMEA's RPN = Severity × Occurrence × Detection, where higher scores indicate failure modes requiring priority corrective action.
A risk analyst maps risks along their entire value chain from raw materials to end customer. This approach is called:
Answer: Value chain risk analysis
Value chain risk analysis identifies risks at each stage of the production and delivery process, exposing interdependencies and single points of failure.
Which risk identification source is most useful for identifying emerging risks that haven't yet materialized in historical data?
Answer: Horizon scanning and environmental monitoring
Horizon scanning monitors trends, weak signals, and external environments to detect emerging risks before they appear in historical loss data.
In a risk bow-tie diagram, the 'knot' in the center represents:
Answer: The critical risk event or hazard
The center knot of a bow-tie diagram represents the critical risk event, with threats and causes on the left and consequences on the right.