PECB ISO-31000-CLA Online Practice Questions and Exam Preparation

PECB ISO-31000-CLA Online Questions & Answers

• Question 1:

  Which of the following is considered a risk analysis technique?

  A. Budget allocation
  B. Consensus building
  C. Insurance placement
  D. Monte Carlo simulation
  D. Monte Carlo simulation

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  Monte Carlo simulation is a risk analysis technique that uses random variables to model uncertainty and generate possible outcomes . This helps to assess the probability and impact of different scenarios. 2

• Question 2:

  Which of the following ensures that uncertainty is managed so the organization can meet its objectives?

  A. Extended risk management
  B. Enhanced risk management
  C. Evasive risk management
  D. Avoidance risk management
  B. Enhanced risk management

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  Enhanced risk management ensures that uncertainty is managed so the organization can meet its objectives . 4 Enhanced risk management involves applying a systematic and logical process to identify, analyze, evaluate, treat, monitor, review, and communicate risks.

• Question 3:

  Which activity ensures transparency in risk management?

  A. Risk evaluation
  B. Risk recording and reporting
  C. Risk treatment
  D. Risk prioritization
  B. Risk recording and reporting

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  Recording and reporting promote transparency by documenting risk decisions, actions, and outcomes.

• Question 4:

  What could a financial organisation make primary use of, to assess whether its risk management systems are likely to fail?

  A. Key control indicators.
  B. Key risk indicators.
  C. Silo-based risk management.
  D. Physical inspections.
  B. Key risk indicators.

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  Key risk indicators are metrics that provide information about potential changes in the level of risk exposure . 3 They can help an organisation monitor and manage its risks more effectively. Key control indicators are metrics that measure the performance of internal controls . 4

• Question 5:

  Which of the following are Critical Elements of a Risk Management Framework? (choose four)

  A. Architect the system
  B. Design the system
  C. Strategize the system
  D. Implement the system
  E. Assure the system
  F. Organize the system
  B. Design the system
  D. Implement the system
  E. Assure the system
  F. Organize the system

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  According to ISO 31000:2018, a risk management framework consists of four critical elements: design (B), implement (D), evaluate (E) and improve (F) . These elements guide an organization in integrating risk 5 management into all functions and processes.

• Question 6:

  Which risk treatment option involves discontinuing an activity that generates risk?

  A. Risk sharing
  B. Risk mitigation
  C. Risk acceptance
  D. Risk avoidance
  D. Risk avoidance

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  Risk avoidance involves deciding not to start or to discontinue activities that create unacceptable risk.

• Question 7:

  What does the probability of occurrence multiplied by the impact of the event, equals to

  A. Risk Tangent
  B. Risk Scale
  C. Risk Level
  D. Risk Magnitude
  D. Risk Magnitude

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  According to , page 13-14, probability multiplied by impact equals risk magnitude which is "a measure that reflects both likelihood and consequences". It can be used as an indicator for prioritizing risks.

• Question 8:

  A train has crashed and is badly damaged. There have been numerous claims from injured passengers as well as a loss of revenue for the train operator. This is an example of

  A. risk aggregation.
  B. risk categorisation.
  C. risk probability.
  D. risk severity.
  A. risk aggregation.

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  A train crash and its consequences is an example of risk aggregation, which is the combined effect of multiple risks on an organisation's objectives . Risk aggregation can result in losses that are greater than the sum of 3 individual losses.

• Question 9:

  What is the role of risk management in the strategic planning process?

  A. Challenge the decisions made.
  B. Develop risk treatment plans.
  C. Draft the decisions to be made.
  D. Identify threats and opportunities.
  D. Identify threats and opportunities.

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  According to , page 7-8, one of the roles of risk management in the strategic planning process is to identify threats and opportunities that could affect the organization's objectives and performance.

• Question 10:

  Which of the following are ISO 31000:2009 Enhanced Risk Management attributes? (Choose two)

  A. Full accountability for risk controls and treatment
  B. Solution offering
  C. Decision making involves risk
  D. Crisis management and process attributes
  A. Full accountability for risk controls and treatment
  C. Decision making involves risk

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  Full accountability for risk controls and treatment and decision making involves risk are two of the enhanced risk management attributes according to ISO 31000:2009 . These attributes indicate that risk management is 1 integrated into governance and decision-making processes.