Calculate the annualized rate of occurrence

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Ebidding company has a ecommerce website that generate $500,000 per year. Calculate the annualized rate of occurrence (ARO) and annualized loss expectancy (ALE) for each risk:

Category

Cost per incident

Frequency of occurrence

Programming errors

$1,000

2 per week

Information theft(hacker)

$2,000

1 per quarter

Information theft(employee)

$5,000

1 per year

Viruses

$1,000

1 per year

Denial of service attacks

$3,500

1 per 6 month

Natural diaster

$100,000

1 per 20 years

Note: read background materials, and also make sure to convert frequency of occurrence to yearly base.

One year past, calculate the cost and benefit of controls that have been in place.

Category

Cost per incident

Frequency of occurrence

Cost of control

Type of control

Programming errors

$1,000

2 per week

$2500

Training

Information theft(hacker)

$2,000

1 per quarter

$10,000

Firewall

Information theft(employee)

$5,000

1 per year

$10,000

Physical security

Viruses

$1,000

1 per year

$10,000

Anti-virus

Denial of service attacks

$3,500

1 per 6 month

$10,000

Firewall

Natural diaster

$100,000

1 per 20 years

$15,000

Insurance

Reference no: EM131773810

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