The Information Technology (IT) department plays a very important role in identifying and protecting the company’s internal and external information dependencies. Also, the information technology elements of the BCP should address several vital issue, including:
Ensuring that the company employs sufficient physical security mechanisms to preserve vital network and hardware components. including file and print servers. Ensuring that the organization uses sufficient logical security methodologies (authentication, authorization, etc.) for sensitive data.
Reference: KRUTZ, Ronald L. & VINES, Russel D., The CISSP Prep Guide: Mastering the Ten Domains of Computer Security, John Wiley & Sons, 2001, page 279.

Residual risk is “The security risk that remains after controls have been implemented” ISO/IEC TR 13335-1 Guidelines for the Management of IT Security (GMITS), Part 1: Concepts and Models for IT Security, 1996. “Weakness of an assets which can be exploited by a threat” is vulnerability. “The result of unwanted incident” is impact. Risk that remains after risk analysis has been performed is a distracter.
Risk can never be eliminated nor avoided, but it can be mitigated, transferred or accpeted. Even after applying a countermeasure like for example putiing up an Antivirus. But still it is not 100% that systems will be protected by antivirus.

Three steps are undertaken in a quantitative risk assessment:
Initial management approval Construction of a risk assessment team, and The review of information currently available within the organization.
There are a few formulas that you MUST understand for the exam. See them below:
SLE (Single Loss Expectancy) Single loss expectancy (SLE) must be calculated to provide an estimate of loss. SLE is defined as the difference between the original value and the remaining value of an asset after a single exploit.
The formula for calculating SLE is as follows: SLE = asset value (in $) × exposure factor (loss due to successful threat exploit, as a %)
Losses can include lack of availability of data assets due to data loss, theft, alteration, or denial of service (perhaps due to business continuity or security issues).
ALE (Annualized Loss Expectancy) Next, the organization would calculate the annualized rate of occurrence (ARO).
This is done to provide an accurate calculation of annualized loss expectancy (ALE).
ARO is an estimate of how often a threat will be successful in exploiting a vulnerability over the period of a year.
When this is completed, the organization calculates the annualized loss expectancy (ALE). The ALE is a product of the yearly estimate for the exploit (ARO) and the loss in value of an asset after an SLE.
The calculation follows ALE = SLE x ARO
Note that this calculation can be adjusted for geographical distances using the local annual frequency estimate (LAFE) or the standard annual frequency estimate (SAFE). Given that there is now a value for SLE, it is possible to determine what the organization should spend, if anything, to apply a countermeasure for the risk in question.
Remember that no countermeasure should be greater in cost than the risk it mitigates, transfers, or avoids. Countermeasure cost per year is easy and straightforward to calculate. It is simply the cost of the countermeasure divided by the years of its life (i.e., use within the organization). Finally, the organization is able to compare the cost of the risk versus the cost of the countermeasure and make some objective decisions regarding its countermeasure selection.
The following were incorrect answers:
All of the other choices were incorrect.
The following reference(s) were used for this quesiton: Hernandez CISSP, Steven (2012-12-21). Official (ISC)2 Guide to the CISSP CBK, Third Edition ((ISC)2 Press) (Kindle Locations 10048-10069). Auerbach Publications. Kindle Edition.

If every one of the 100 clerks makes 1 error 12 times per year, it makes a total of 1200 errors. The Annnualized Rate of Occurence (ARO) is a value that represents the estimated frequency in which a threat is expected to occur. The range can be from 0.0 to a large number. Having an average of 1200 errors per year means an ARO of 1200

It’s interesting to note that the steps to resume normal processing operations will be different than the steps of the recovery plan; that is, the least critical work should be brought back first to the primary site.
The most important point above in the steps would be to move the least critical items or resources back to the primary site first. This way you can ensure that the site was really well prepared and that all is working fine.
Before that first step would be done, you would get the green light from the salvage team that it is fine to move back to the primary site. The first step after getting the green light would be to move the least critical elements first.
As stated in the Shon Harris book: The least critical functions should be moved back first, so if there are issues in network configurations or connectivity, or important steps were not carried out, the critical operations of the company are not negatively affected. Why go through the trouble of moving the most critical systems and operations to a safe and stable site, only to return it to a main site that is untested? Let the less critical departments act as the canary. If they survive, then move over the more critical components of the company.
When it is time for the company to move back into its original site or a new site, the company enters the reconstitution phase. A company is not out of an emergency state until it is back in operation at the original primary site or a new site that was constructed to replace the primary site, because the company is always vulnerable while operating in a backup facility.
Many logistical issues need to be considered as to when a company must return from the alternate site to the original site. The following lists a few of these issues:
Ensuring the safety of employees Ensuring an adequate environment is provided (power, facility infrastructure, water, HVAC) Ensuring that the necessary equipment and supplies are present and in working order Ensuring proper communications and connectivity methods are working Properly testing the new environment
Once the coordinator, management, and salvage team sign off on the readiness of the facility, the salvage team should carry out the following steps:
Back up data from the alternate site and restore it within the new facility. Carefully terminate contingency operations. Securely transport equipment and personnel to the new facility.
All other choices are not the correct answer.
Reference(s) used for this question: Harris, Shon (2012-10-25). CISSP All-in-One Exam Guide, 6th Edition (Kindle Location 19389). McGraw-Hill. Kindle Edition. and KRUTZ, Ronald L. & VINES, Russel D., The CISSP Prep Guide: Mastering the Ten Domains of Computer Security, John Wiley & Sons, 2001, Page 290.

Internal Hot Site—This site is standby ready with all the technology and equipment necessary to run the applications positioned there. The planner will be able to effectively restart an application in a hot site recovery without having to perform any bare metal recovery of servers. If this is an internal solution, then often the organization will run non-time sensitive processes there such as development or test environments, which will be pushed aside for recovery of production when needed. When employing this strategy, it is important that the two environments be kept as close to identical as possible to avoid problems with O/S levels, hardware differences, capacity differences, etc., from preventing or delaying recovery. Recovery Site Strategies Depending on how much downtime an organization has before the technology recovery must be complete, recovery strategies selected for the technology environment could be any one of the following: Dual Data Center—This strategy is employed for applications, which cannot accept any downtime without negatively impacting the organization. The applications are split between two geographically dispersed data centers and either load balanced between the two centers or hot swapped between the two centers. The surviving data center must have enough head room to carry the full production load in either case.
External Hot Site—This strategy has equipment on the floor waiting, but the environment must be rebuilt for the recovery. These are services contracted through a recovery service provider. Again, it is important that the two environments be kept as close to identical as possible to avoid problems with O/S levels, hardware differences, capacity differences, etc., from preventing or delaying recovery. Hot site vendors tend to have the most commonly used hardware and software products to attract the largest number of customers to utilize the site. Unique equipment or software would generally need to be provided by the organization either at time of disaster or stored there ahead of time. Warm Site—A leased or rented facility that is usually partially configured with some equipment, but not the actual computers. It will generally have all the cooling, cabling, and networks in place to accommodate the recovery but the actual servers, mainframe, etc., equipment are delivered to the site at time of disaster. Cold Site—A cold site is a shell or empty data center space with no technology on the floor. All technology must be purchased or acquired at the time of disaster.
Reference(s) used for this question: Hernandez CISSP, Steven (2012-12-21). Official (ISC)2 Guide to the CISSP CBK, Third Edition ((ISC)2 Press) (Kindle Locations 21265-21291). Auerbach Publications. Kindle Edition.

Updating records in multiple locations or copying an entire database to a remote location as a means to ensure the appropriate levels of fault-tolerance and redundancy is known as Database shadowing. Shadowing is the technique in which updates are shadowed in multiple locations. It is like copying the entire database on to a remote location.
Shadow files are an exact live copy of the original active database, allowing you to maintain live duplicates of your production database, which can be brought into production in the event of a hardware failure. They are used for security reasons: should the original database be damaged or incapacitated by hardware problems, the shadow can immediately take over as the primary database. It is therefore important that shadow files do not run on the same server or at least on the same drive as the primary database files.
The following are incorrect answers:
Data mirroring In data storage, disk mirroring is the replication of logical disk volumes onto separate physical hard disks in real time to ensure continuous availability. It is most commonly used in RAID 1. A mirrored volume is a complete logical representation of separate volume copies.
Backups In computing the phrase backup means to copy files to a second medium (a disk or tape) as a precaution in case the first medium fails. One of the cardinal rules in using computers is back up your files regularly. Backups are useful in recovering information or a system in the event of a disaster, else you may be very sorry 🙁
Archiving is the storage of data that is not in continual use for historical purposes. It is the process of copying files to a longterm storage medium for backup.
Reference(s) used for this question: Hernandez CISSP, Steven (2012-12-21). Official (ISC)2 Guide to the CISSP CBK, Third Edition ((ISC)2 Press) (Kindle Locations 27614-27626). Auerbach Publications. Kindle Edition. http://en.wikipedia.org/wiki/Disk_mirroring http://www.webopedia.com/TERM/A/archive.html http://ibexpert.net/ibe/index.php?n=Doc.DatabaseShadow

This question is testing your ability to evaluate whether items on the list are Qualitative or Quantitative. All of the items listed were Qualitative except Lost of Revenue which is Quantitative.
Those are mainly two approaches to risk analysis, see a description of each below:
A quantitative risk analysis is used to assign monetary and numeric values to all elements of the risk analysis process. Each element within the analysis (asset value, threat frequency, severity of vulnerability, impact damage, safeguard costs, safeguard effectiveness, uncertainty, and probability items) is quantified and entered into equations to determine total and residual risks. It is more of a scientific or mathematical approach to risk analysis compared to qualitative.
A qualitative risk analysis uses a “softer” approach to the data elements of a risk analysis . It does not quantify that data, which means that it does not assign numeric values to the data so that they can be used in equations.
Qualitative and quantitative impact information should be gathered and then properly analyzed and interpreted. The goal is to see exactly how a business will be affected by different threats.
The effects can be economical, operational, or both. Upon completion of the data analysis, it should be reviewed with the most knowledgeable people within the company to ensure that the findings are appropriate and that it describes the real risks and impacts the organization faces. This will help flush out any additional data points not originally obtained and will give a fuller understanding of all the possible business impacts.
Loss criteria must be applied to the individual threats that were identified. The criteria may include the following:
Loss in reputation and public confidence Loss of competitive advantages Increase in operational expenses Violations of contract agreements Violations of legal and regulatory requirements Delayed income costs
Loss in revenue Loss in productivity
Reference used for this question: Harris, Shon (2012-10-18). CISSP All-in-One Exam Guide, 6th Edition (p. 909). McGraw-Hill. Kindle Edition.

A cold site is a permanent location that provide you with your own space that you can move into in case of a disaster or catastrophe. It is one of the cheapest solution available as a rental place but it is also the one that would take the most time to recover. A cold site usually takes one to two weeks for recoverey.
Although major disruptions with long-term effects may be rare, they should be accounted for in the contingency plan. The plan should include a trategy to recover and perform system operations at an alternate facility for an extended period. In general, three types of alternate sites are available:
Dedicated site owned or operated by the organization. Also called redundant or alternate sites;
Reciprocal agreement or memorandum of agreement with an internal or external entity; and
Commercially leased facility.
Regardless of the type of alternate site chosen, the facility must be able to support system operations as defined in the contingency plan. The three alternate site types commonly categorized in terms of their operational readiness are cold sites, warm sites, or hot sites. Other variations or combinations of these can be found, but generally all variations retain similar core features found in one of these three site types.
Progressing from basic to advanced, the sites are described below:
Cold Sites are typically facilities with adequate space and infrastructure (electric power, telecommunications connections, and environmental controls) to support information system recovery activities.
ƒWarm Sites are partially equipped office spaces that contain some or all of the system hardware, software, telecommunications, and power sources.
Hot Sites are facilities appropriately sized to support system requirements and configured with the necessary system hardware, supporting infrastructure, and support personnel.
As discussed above, these three alternate site types are the most common. There are also variations, and hybrid mixtures of features from any one of the three. Each organization should evaluate its core requirements in order to establish the most effective solution.
Two examples of variations to the site types are:
ƒMobile
Sites are self-contained, transportable shells custom-fitted with specific telecommunications and system equipment necessary to meet system requirements.
ƒMirrored
Sites are fully redundant facilities with automated real-time information mirroring. Mirrored sites are identical to the primary site in all technical respects.
There are obvious cost and ready-time differences among the options. In these examples, the mirrored site is the most expensive choice, but it ensures virtually 100 percent availability. Cold sites are the least expensive to maintain, although they may require substantial time to acquire and install necessary equipment. Partially equipped sites, such as warm sites, fall in the middle of the spectrum. In many cases, mobile sites may be delivered to the desired location within 24 hours, but the time necessary for equipment installation and setup can increase this response time. The selection of fixed-site locations should account for the time and mode of transportation necessary to move personnel and/or equipment there. In addition, the fixed site should be in a geographic area that is unlikely to be negatively affected by the same hazard as the organization’s primary site.
The following reference(s) were used for this question: http://csrc.nist.gov/publications/nistpubs/800-34-rev1/sp800-34-rev…

SearchStorage.com Definitions mentions “As part of a disaster recovery plan, BIA is likely to identify costs linked to failures, such as loss of cash flow, replacement of equipment, salaries paid to catch up with a backlog of work, loss of profits, and so on.
A BIA report quantifies the importance of business components and suggests appropriate fund allocation for measures to protect them. The possibilities of failures are likely to be assessed in terms of their impacts on safety, finances, marketing, legal compliance, and quality assurance.
Where possible, impact is expressed monetarily for purposes of comparison. For example, a business may spend three times as much on marketing in the wake of a disaster to rebuild customer confidence.”
Source: KRUTZ, Ronald L. & VINES, Russel D., The CISSP Prep Guide: Mastering the Ten Domains of Computer Security, John Wiley & Sons, 2001, Page 278.