Which of the following best describes the importance of risk assessment?
A) Risk assessment allows management to determine the extent of the internal controls required to eliminate inherent risk and to minimize control risk.
B) Risk assessment is necessary to set priorities for risks in order of frequency so the most frequently occurring risks can be eliminated in a cost effective manner.
C) As go the risks, so go the insurance premiums and costs. Risk assessment is management's primary tool to lower insurance premiums and casualty losses.
D) Risk assessment helps management set priorities and determine the organization's risk response.

Question

Quizplus · Accepted Answer

Risk assessment is important because it helps management identify and prioritize the risks that could impact the organization. By understanding the potential impact and likelihood of each risk, management can determine its risk response, allocate resources more effectively, and make informed decisions to protect the organization.

Which of the Following Best Describes the Importance of Risk