ISO-31000-CLA GAQM ISO 31000 - Certified Lead Risk Manager Free Practice Exam Questions (2025 Updated)

Understanding the potential causes of risk events will primarily help an organisation to reduce the frequency of loss. This is because identifying and analysing the sources and drivers of risks can enable an organisation to implement preventive or mitigating measures.

Records are one of the tools used by risk managers for communication between stakeholdersand interested parties2. Records help to share information, insights, recommendations, and decisions related to risk management.

External and internal risks are significant risks of reporting that are outside the risk appetite of the organization and can impact compliance, which may also be reportable to regulatory agencies1. These risks may arise from external factors such as market changes, natural disasters, or cyberattacks, or internal factors such as human errors, fraud, or system failures.

Control is not a set of systematic, deliberate, and actionable steps to manage risk, but rather a measure or action that modifies risk1. Process is a set of systematic, deliberate, and actionable steps to manage risk2. Process involves establishing context, identifying risks, analyzing risks, evaluating risks, and treating risks.

 Key risk indicators are metrics that provide information about potential changes in the level of risk exposure3. They can help an organisation monitor and manage its risks more effectively. Key control indicators are metrics that measure the performance of internal controls4.

Chief Risk Officer (CRO) serves as the principal adviser to the CEO, business unit heads, and critical function heads on risk matter. CRO leads the development and implementation of the organization’s risk management framework and process.

Monte Carlo simulation is a risk analysis technique that uses random variables to model uncertainty and generate possible outcomes2. This helps to assess the probability and impact of different scenarios.

According to , page 9, defining the context involves “understanding what influences people’s perception and tolerance of risks”. Discussing how girls are viewed by community members can help identify potential sources of resistance, conflict or violence that may affect the project’s objectives and outcomes.

According to page 12 of the source, risk management professionals conduct supply chain analysis to identify potential vulnerabilities to the organization. These vulnerabilities can arise due to supplier dependency, breakdowns or disruptions in the supply chain, natural or human-made disasters, political or social instability, cyberattacks or other threats. Identifying such risks is crucial to prevent adverse impacts on the organization's operations, reputation or financial position.

A review of the goals and objectives of the risk strategy is part of defining the success measures for the organization’s risk strategy1. This helps to ensure that the risk strategy aligns with the organization’s purpose, vision, mission and values.

There are nine risk management principles in ISO 31000:2018. These principles are:

Integrated

Structured and comprehensive

Customized

Inclusive

Dynamic

Best available information

Human and cultural factors

Continual improvement

Residual risk is the type of risk that remains after risk treatment has been applied1. Residual risk reflects the remaining exposure or uncertainty after taking into account existing controls.

According to 3, page 6, one of the current trends in auditing, risk management and compliance is “moving from a back-office function providing lagging indicators about risk (e.g., audit findings) to a front-office function providing leading indicators about risk (e.g., key risk indicators)”.

According to , page 9, one of the current trends in auditing, risk management and compliance is “shifting from auditing people to auditing processes”. This means that internal auditors focus more on how well an organization’s processes are designed and implemented to achieve its objectives and manage its risks.

Scoping framework boundaries is a major challenge in implementing the ISO 31000:2018 risk management framework. Scoping framework boundaries involves defining the scope of application of risk management within the organization’s context,

structure, and objectives.

According to 1, page 19, historic analysis is “a method of risk identification based on past data”. It assumes that past patterns and trends will continue in the future, which may not always be true.

According to , page 23, after validating the training curricula, a risk management professional schedules and conducts training sessions based on the target audience’s needs and availability.

A large manufacturing organisation has renewed an insurance policy and has accepted a significant increase in the policy deductible. This is most likely to indicate increased risk retention, which means accepting more responsibility for potential losses5. This could be done to reduce insurance premiums or increase control over claims.

According to 1, there are four types of potential risk strategies for threats: avoid (eliminate or change), transfer (share or outsource), mitigate (reduce or control), accept (retain or monitor). There are also four types of potential risk strategies for opportunities: exploit (ensure or enhance), share (allocate or collaborate), enhance (increase or maximize), accept (acknowledge or watch).