MANAGEMENT

Detailed explanation-1: -Residual risk is the risk that remains after efforts to identify and eliminate some or all types of risk have been made. Residual risk is important for several reasons. First to consider is that residual risk is the risk “left over” after security controls and process improvements have been applied.

Detailed explanation-2: -A residual risk is a controlled risk. It’s the risk level after controls have been put in place to reduce the risk. Residual risk should only be a small proportion of the risk level that would be involved in the activity if no control measures were in place at all.

Detailed explanation-3: -Risk analysis is the process of identifying and analyzing potential issues that could negatively impact key business initiatives or projects. This process is done in order to help organizations avoid or mitigate those risks.

Detailed explanation-4: -Here are the standard definitions of inherent and residual risk: Inherent risk represents the amount of risk that exists in the absence of controls. Residual risk is the amount of risk that remains after controls are accounted for.

Detailed explanation-5: -An example of residual risk is given by the use of automotive seat-belts. Installation and use of seat-belts reduces the overall severity and probability of injury in an automotive accident; however, probability of injury remains when in use, that is, a remainder of residual risk.