CISM Information Security Programme Practice Question
A company is implementing a vendor tiering system for third-party risk management. Which TWO factors should be used to determine the tier of a vendor?
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Criticality of the service provided by the vendor
Vendor tiering is typically based on the sensitivity of data the vendor accesses and the criticality of the service they provide. These factors determine the risk level and required controls.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✗
Vendor's marketing budget
Why it's wrong here
Marketing budget is irrelevant to security risk.
- ✓
Criticality of the service provided by the vendor
Why this is correct
Correct. Service criticality affects business impact.
- ✗
Vendor's stock price
Why it's wrong here
Stock price is not a risk factor for third-party security.
- ✓
Type of data accessed by the vendor
Why this is correct
Correct. Data sensitivity is a key factor.
- ✗
Vendor's annual revenue
Why it's wrong here
Revenue is not a direct indicator of risk from the vendor's services.
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JA
Written by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
This CISM practice question is part of Courseiva's free ISACA certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the CISM exam.