The termimpactrefers to the severity or magnitude of the consequences of an event if it occurs. It is a key metric in risk analysis, used alongside likelihood to determine overall risk.
Key Points About Impact:
* Definition: Impact measures the potential effect of an event on organizational objectives, such as financial losses, reputational harm, or operational disruptions.
* Role in Risk Assessment:
* Impact is evaluated to understand the significance of a risk.
* Frameworks likeCOSO ERMrecommend assessing impact in terms of quantitative and qualitative outcomes.
* Examples:
* Financial loss due to a data breach.
* Customer dissatisfaction caused by product delays.
Why Option A is Correct:
Impact specifically estimates the consequences of an event, making it the correct answer.
Why the Other Options Are Incorrect:
* B. Consequence: While consequence describes the outcome, impact specifically quantifies or qualifies its severity.
* C. Likelihood: Likelihood measures probability, not consequences.
* D. Cause: Cause identifies why an event happens, not its effects.
References and Resources:
* COSO ERM Framework- Emphasizes impact analysis in enterprise risk management.
* ISO 31000:2018- Provides guidelines for impact assessment.

Qualitative analysis techniquesrely on descriptive data, expert judgment, and subjective assessments, making them useful for certain contexts but potentially limited in precision.
* Limitations of Qualitative Analysis:
* Subjectivity: Results may vary depending on the perspective and experience of the individuals conducting the analysis.
* Precision: Lack of numeric data may result in less accurate estimations compared to quantitative methods.
* Strengths of Qualitative Analysis:
* Useful in scenarios where data is unavailable or events are too complex for numerical evaluation.
* Provides insights into risks, rewards, and compliance in terms of likelihood and severity.
* Why Other Options Are Incorrect:
* A: Qualitative analysis does not inherently lead to incorrect conclusions; its accuracy depends on its application.
* B: Qualitative methods are widely applicable in risk and reward analysis.
* D: It is not limited to compliance-related risks.
References:
* ISO 31000 (Risk Management): Explains the role of qualitative methods in risk assessments.
* COSO ERM Framework: Discusses qualitative and quantitative analysis in decision-making.

Riskis defined as theeffect of uncertainty on objectives, encompassing both positive opportunities and negative outcomes.
* Definition:
* In GRC and risk management, risk is the combination of the likelihood of an event and its consequences.
* Measurement:
* Risk quantifies the potential negative impact on objectives due to uncertainty.
* Why Other Options Are Incorrect:
* B(Harm): Refers to physical or psychological damage, not a risk metric.
* C(Obstacle): Refers to a challenge or barrier, not the overall concept of risk.
* D(Threat): Represents a potential source of risk, not the measure itself.
References:
* ISO 31000 (Risk Management): Provides a formal definition of risk and its relationship to uncertainty.
* NIST RMF: Emphasizes risk management as a function of organizational objectives.