- A
Conduct a detailed cost-benefit analysis to convince the risk owner to upgrade, but do not escalate until the analysis is complete.
Why wrong: While a cost-benefit analysis might help, the immediate non-compliance and high risk require escalation per policy; delaying escalates the risk.
- B
Accept the risk owner's decision and update the risk register to reflect the deferred treatment with a note of the risk owner's acceptance.
Why wrong: Deferring without escalation violates the risk appetite policy and could lead to non-compliance; the risk owner does not have the authority to accept such a high residual risk.
- C
Implement a compensating control, such as strong application-layer encryption, to reduce the residual risk to an acceptable level without upgrading TLS.
Why wrong: Compensating controls may not meet the specific regulatory requirement; the regulation mandates TLS 1.3, so a compensating control is likely insufficient and still non-compliant.
- D
Escalate the issue to the risk management committee for a decision on whether to accept, mitigate, or defer the risk.
This follows the governance process and ensures that the risk is evaluated at the appropriate level with authority to override the risk owner's stance.
Quick Answer
The answer is to escalate the issue to the risk management committee for a final decision on whether to accept, mitigate, or defer the risk. This is correct because when a risk escalation process reaches a point of risk owner refusal, the information security manager must follow the established governance hierarchy, which in this case requires the risk management committee to adjudicate the dispute and align the decision with the organization’s risk appetite statement. On the CISM exam, this scenario tests your understanding of the escalation chain and the distinction between risk ownership and risk governance—a common trap is to assume the security manager should override the risk owner or accept the risk themselves. Remember the memory tip: when the risk owner refuses and residual risk exceeds appetite, escalate to the committee for a binding decision, not to the CRO alone.
CISM Information Security Risk Management Practice Question
This CISM practice question tests your understanding of information security risk management. Read the scenario carefully and evaluate each option against the stated constraints before committing to an answer. 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 multinational financial services company is implementing a new regulatory requirement that mandates enhanced encryption for all customer data in transit. The organization currently uses TLS 1.2, but the regulation requires TLS 1.3. The risk owner for the data transmission system is the head of network operations, who believes the current controls are sufficient and argues that upgrading will cause significant downtime and cost. The information security manager has assessed the risk as high due to potential regulatory fines and reputational damage. The risk owner refuses to accept the risk and insists on deferring the upgrade. The organization has a risk appetite statement that accepts moderate residual risk only after explicit approval from the CRO. The escalation process involves the risk management committee. What is the BEST course of action for the information security manager?
Clue words in this question
Noticing these words before you look at the options changes how you read each choice.
Clue:
"best"Why it matters: Signals that multiple options may be partially correct. Choose the option that most directly solves the exact problem described, not the one that sounds most complete.
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
Escalate the issue to the risk management committee for a decision on whether to accept, mitigate, or defer the risk.
Given the risk owner's refusal and the high residual risk exceeding appetite, the security manager should formally escalate to the risk management committee for a final decision, as per the established governance process. This ensures proper oversight and documentation.
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.
- ✗
Conduct a detailed cost-benefit analysis to convince the risk owner to upgrade, but do not escalate until the analysis is complete.
Why it's wrong here
While a cost-benefit analysis might help, the immediate non-compliance and high risk require escalation per policy; delaying escalates the risk.
- ✗
Accept the risk owner's decision and update the risk register to reflect the deferred treatment with a note of the risk owner's acceptance.
Why it's wrong here
Deferring without escalation violates the risk appetite policy and could lead to non-compliance; the risk owner does not have the authority to accept such a high residual risk.
- ✗
Implement a compensating control, such as strong application-layer encryption, to reduce the residual risk to an acceptable level without upgrading TLS.
Why it's wrong here
Compensating controls may not meet the specific regulatory requirement; the regulation mandates TLS 1.3, so a compensating control is likely insufficient and still non-compliant.
- ✓
Escalate the issue to the risk management committee for a decision on whether to accept, mitigate, or defer the risk.
Why this is correct
This follows the governance process and ensures that the risk is evaluated at the appropriate level with authority to override the risk owner's stance.
Clue confirmation
The clue word "best" in the question point toward this answer.
Related concept
Static NAT maps one inside address to one outside address.
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.
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FAQ
Questions learners often ask
What does this CISM question test?
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: Escalate the issue to the risk management committee for a decision on whether to accept, mitigate, or defer the risk. — Given the risk owner's refusal and the high residual risk exceeding appetite, the security manager should formally escalate to the risk management committee for a final decision, as per the established governance process. This ensures proper oversight and documentation.
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: "best". Signals that multiple options may be partially correct. Choose the option that most directly solves the exact problem described, not the one that sounds most complete.
What is the key concept behind this question?
Static NAT maps one inside address to one outside address.
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Last reviewed: Jun 24, 2026
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.
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