Certified Governance Risk and Compliance (CGRC) Practice Exam 2026 - Free CGRC Practice Questions and Study Guide

In a risk assessment, evaluating the consequences of the risk is crucial for determining the potential impact. This element helps organizations understand what might happen if a risk event occurs and the severity of that event on operations, financials, regulatory compliance, or reputation. By assessing the consequences, organizations can prioritize risks based on their potential impact and take appropriate steps to manage them.

The focus on consequences allows for a deeper understanding of how risks can affect a business. It informs the decision-making process regarding risk mitigation and helps in crafting effective strategies to minimize or eliminate negative outcomes. Understanding the consequences ensures that resources are allocated effectively to address the most significant threats.

Other elements present in the question, while important in the context of a comprehensive risk assessment, do not directly address the impact. For instance, assessing the likelihood of occurrence helps understand the probability of a risk event happening but does not directly evaluate its impact. Similarly, understanding threat sources and risk mitigation strategies are essential components of a risk management approach, yet they do not specifically identify the potential consequences associated with the risk itself.