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SC-100 Managed Identity Practice Question

Wide World Importers is deploying a critical line-of-business application on Azure Kubernetes Service (AKS). The application processes financial transactions and must meet SOX compliance. You need to design a security solution that includes: encryption of secrets (e.g., database connection strings) using Azure Key Vault, automatic certificate rotation for TLS termination, network isolation of the AKS cluster, and audit logging of all access to secrets. The solution should use a managed identity for the AKS cluster to access Key Vault. Which of the following designs meets the requirements?

⚠ Common exam trap

Candidates may think that using a service principal is acceptable, but managed identity is more secure and recommended. Also, they might assume that storing secrets as Kubernetes Secrets with encryption is equivalent to using Key Vault, but Key Vault provides centralized management, automatic rotation, and independent audit logging.

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

Enable managed identity for the AKS cluster, integrate Key Vault with AKS using the Secrets Store CSI driver, deploy the cluster as a private cluster, and enable diagnostic settings on Key Vault to send logs to a Log Analytics workspace.

It uses managed identity for secure secret access, integrates Key Vault with AKS using the Secrets Store CSI driver for automatic secret rotation and encryption, deploys the cluster as a private cluster for network isolation, and enables diagnostic settings on Key Vault for audit logging. Option B is wrong because it uses a service principal (less secure than managed identity) and stores secrets as Kubernetes secrets (not encrypted at rest by default). Option C is wrong because it stores secrets in native Kubernetes secrets instead of Key Vault, and uses a private endpoint only for the API server, not full cluster isolation. Option D is wrong because it uses a service principal and stores secrets as encrypted Kubernetes secrets with a customer-managed key, which is not as secure as Key Vault integration, and uses a public cluster.

Answer analysis

Option-by-option breakdown

For each option: why learners choose it and why it is or isn't the right answer here.

  • Enable managed identity for the AKS cluster, integrate Key Vault with AKS using the Secrets Store CSI driver, deploy the cluster as a private cluster, and enable diagnostic settings on Key Vault to send logs to a Log Analytics workspace.

    Why this is correct

    Managed identity eliminates long-lived service principal credentials by providing an Azure AD-backed identity automatically rotated, which AKS uses to authenticate to Key Vault. The Secrets Store CSI driver mounts selected Key Vault items directly into pods as ephemeral volumes, so secret material never persists in etcd and supports rotation without pod restarts. Deploying AKS as a private cluster ensures the Kubernetes API server receives only private IP addresses, preventing exposure to the public internet. Enabling diagnostic settings on Key Vault streams audit event logs to Log Analytics, giving the security operations team a centralized, queryable trail of access and modifications.

  • Use a service principal for AKS to access Key Vault, store secrets as Kubernetes secrets, configure a private cluster, and enable audit logging on Key Vault.

    Why it's wrong here

    Using a service principal reintroduces a static credential that must be provisioned, stored, and rotated somewhere in the deployment pipeline, creating an unnecessary attack surface compared to managed identity. Storing the pulled secrets as Kubernetes secrets means they exist in the cluster's etcd database; without an encryption provider configured, these are merely base64-encoded and readable by anyone with etcd access. A private cluster prevents API server exposure, but it does nothing to protect secrets at rest. Key Vault audit logging will record the service principal's reads, but it will not protect the wide-spread plaintext copies that are now living in Kubernetes secrets.

  • Enable managed identity for the AKS cluster, store secrets in the cluster's native Kubernetes secrets, use a private endpoint for the AKS API server, and enable Azure Monitor for containers.

    Why it's wrong here

    While enabling managed identity is a positive step, keeping secrets as native Kubernetes secrets leaves them in etcd in plaintext base64 rather than in Key Vault, and Kubernetes has no built-in encryption at rest unless you explicitly configure a KMS provider. A private endpoint on the AKS API server only changes how the API server is reached; it does not convert a standard cluster into a private cluster, because node-to-API-server communication and cluster operations may still use the public DNS and network path. Azure Monitor for containers provides CPU and memory telemetry, not secret encryption or network isolation. Thus the solution still misses the core requirement of keeping secret material out of etcd and making the cluster fully private.

  • Use a service principal to access Key Vault, store secrets as encrypted Kubernetes secrets with a customer-managed key, deploy a public cluster with network policies, and enable Key Vault logging.

    Why it's wrong here

    Relying on a service principal requires you to manage and rotate a client secret or certificate, and if it leaks, an attacker can read all Key Vault contents; managed identity removes that static credential completely. The proposal to encrypt Kubernetes secrets with a customer-managed key is not a native Kubernetes feature—it requires extra components like Azure Key Vault KMS provider or a tool such as SOPS, and even then the secrets are still Kubernetes secrets rather than being mounted directly from the vault. A public cluster with network policies can restrict east-west traffic, but the API server remains reachable from the public internet without a private cluster configuration. Enabling Key Vault logging only generates records; it never protects the secret material that is already stored in etcd.

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Written by Johnson Ajibi, MSc IT Security

Senior Network & Security Engineer · founder of Courseiva

This SC-100 practice question is part of Courseiva's free Microsoft 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 SC-100 exam.