The correct answer is risk mitigation through compensating controls and a phased upgrade. This strategy directly addresses the high-risk legacy system by deploying technical safeguards—such as network segmentation, strict access controls, and intrusion detection—to reduce exploitability while the outdated POS remains operational, then systematically replacing it to eliminate the root cause. On the CISM exam, this scenario tests your ability to balance risk reduction with business continuity, a core principle of the risk management domain. A common trap is choosing risk transfer via insurance, which does not prevent incidents, or risk acceptance, which is inappropriate for a high-priority finding. Remember the memory tip: “Compensate and phase—reduce the blast, then replace the past.”
CISM Information Security Risk Management Practice Question
This CISM practice question tests your understanding of information security risk management. The scenario asks you to isolate a root cause — eliminate options that address a different problem before choosing. After answering, compare your reasoning against the explanation and wrong-answer breakdown below. Once you have made your selection, read the full explanation to reinforce the concept and understand why each distractor is designed to mislead on exam day.
A large retail chain with hundreds of stores uses point-of-sale (POS) systems that run an outdated operating system. The annual risk assessment identified this as a high-risk issue because the OS is no longer patched and has known vulnerabilities. The business unit manager opposes replacing all POS systems immediately due to cost and potential disruption to operations. As the risk manager, you need to recommend a risk response that balances risk reduction with business continuity. Which strategy is most appropriate?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue: "immediately / without restart"
Why it matters: Time or reboot constraint — the correct answer must take effect right away without requiring a reboot or reload.
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Risk mitigation: implement compensating controls and schedule a phased upgrade
Option D is correct because risk mitigation through compensating controls (e.g., network segmentation, strict access controls, intrusion detection) combined with a phased upgrade reduces risk while allowing continued operations. Option A is risk avoidance but is too disruptive and costly. Option B is risk transfer via insurance, but insurance does not prevent the incident or reduce the operational impact. Option C is risk acceptance without action, which is inappropriate for a high-risk issue.
Key principle: NAT direction and interface roles matter as much as the IP address mapping. Inside/outside designation controls which traffic is translated.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
✗
Risk avoidance: immediately replace all POS systems with modern ones
Why it's wrong here
Incorrect; this is too disruptive and expensive for a phased approach.
✓
Risk mitigation: implement compensating controls and schedule a phased upgrade
Why this is correct
Correct; this balances risk reduction with business continuity.
Clue confirmation
The clue word "immediately / without restart" in the question point toward this answer.
Related concept
Static NAT maps one inside address to one outside address.
✗
Risk acceptance: accept the risk because the business cannot afford replacement
Why it's wrong here
Incorrect; acceptance without action is not prudent for high risk.
✗
Risk transfer: purchase cyber insurance to cover potential losses from POS attacks
Why it's wrong here
Incorrect; insurance does not mitigate the underlying risk.
Common exam traps
Common exam trap: NAT rules depend on direction and matching traffic
NAT is not only about the public address. The inside/outside interface roles and the ACL or rule that matches traffic are just as important.
Detailed technical explanation
How to think about this question
NAT questions usually test address translation, overload/PAT behaviour, static mappings and whether the right traffic is being translated. Read the interface direction and address terms carefully.
KKey Concepts to Remember
Static NAT maps one inside address to one outside address.
PAT allows many inside hosts to share one public address using ports.
Inside local and inside global describe the private and translated addresses.
NAT ACLs identify traffic for translation, not always security filtering.
TExam Day Tips
→Identify inside and outside interfaces first.
→Check whether the scenario needs static NAT, dynamic NAT or PAT.
→Do not confuse NAT matching ACLs with normal packet-filtering intent.
Key takeaway
NAT direction and interface roles matter as much as the IP address mapping. Inside/outside designation controls which traffic is translated.
Real-world example
How this comes up in practice
A small business has 20 workstations on the 192.168.1.0/24 network and one public IP from its ISP. The router uses PAT (NAT overload) so all 20 devices share one public address using different source ports. NAT questions test whether you understand the four address terms and which direction each translation applies.
What to study next
Got this wrong? Here's your next step.
Review the four NAT address types (inside local, inside global, outside local, outside global), PAT port overload, and static vs dynamic NAT use cases. Then practise related CISM NAT questions on configuration and troubleshooting.
Information Security Risk Management — This question tests Information Security Risk Management — Static NAT maps one inside address to one outside address..
What is the correct answer to this question?
The correct answer is: Risk mitigation: implement compensating controls and schedule a phased upgrade — Option D is correct because risk mitigation through compensating controls (e.g., network segmentation, strict access controls, intrusion detection) combined with a phased upgrade reduces risk while allowing continued operations. Option A is risk avoidance but is too disruptive and costly. Option B is risk transfer via insurance, but insurance does not prevent the incident or reduce the operational impact. Option C is risk acceptance without action, which is inappropriate for a high-risk issue.
What should I do if I get this CISM question wrong?
Review the four NAT address types (inside local, inside global, outside local, outside global), PAT port overload, and static vs dynamic NAT use cases. Then practise related CISM NAT questions on configuration and troubleshooting.
Are there clue words in this question I should notice?
Yes — watch for: "immediately / without restart". Time or reboot constraint — the correct answer must take effect right away without requiring a reboot or reload.
What is the key concept behind this question?
Static NAT maps one inside address to one outside address.
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