inherent risk
Unavoidable potential harm
Inherent risk is the level of exposure or vulnerability that exists before any controls or safeguards are applied.
The term appears frequently in auditing, finance, and risk management: The inherent risk of storing customer data is high, regardless of security measures.
It contrasts with residual risk—what remains after mitigation efforts.
- exposureState of being unprotected
- vulnerabilityOpenness to harm
- hazardSource of potential harm
- liabilityLegal or financial obligation
- red flagIndicator of danger
uncertainty · threat · peril · danger · known unknown · default · loss · probability · audit · assessment · material · misstatement · control · mitigation · tolerance · appetite · management · systematic