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Section 1 1.1 Purpose The purpose of this exercise is to assist the Planning, Internal Audit and Evaluation function in the preparation of the Commission’s "Internal Audit, Evaluation and Risk Management" three year plan. 1.2 Definition of Risk Related Terms Residual Risk The risk remaining after response or mitigation (existing measures and incremental strategies) Risk Combination of the likelihood of an event and its impact - Source: International Standards Organization (ISO). or The uncertainty that surrounds future events and outcomes. It is the expression of the likelihood and impact of an event with the potential to influence the achievement of an organization’s objectives. - Source: Integrated Risk Management Framework, Treasury Board of Canada Secretariat (TBS). Risk Assessment Overall process of identification, measuring impact, likelihood and risk evaluation. Risk-Based Audit Framework (RBAF) Risk-Based Audit Framework is a management process/tool that explains how risk concepts are integrated into the strategies and approaches used for managing programs that are funded through transfer payments. Risk Criteria Standards by which the risks are to be assessed. Risk Evaluation Process of comparing the estimated risk against risk criteria. Risk Management Overall application of policies, processes and practices dealing with risk. Note: Risk management may include identification, assessment, response, monitoring, review and communications. Sources of Risk An event, circumstance or activity with a potential for consequences; for risk assessment purposes sources of risk need to be converted to/categorized as impact or likelihood risk factors.
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