Residual risk is the risk that remains after controls are accounted for. It's the risk that remains after your organization has taken proper precautions. ... In this more realistic scenario, residual risk represents the risks that remain after additional controls are applied.

What is an example of residual risk?

An example of residual risk is given by the use of automotive seat-belts. Installation and use of seat-belts reduces the overall severity and probability of injury in an automotive accident; however, probability of injury remains when in use, that is, a remainder of residual risk.

How do you find residual risk?

Subtracting the impact of risk controls from the inherent risk in the business (i.e., the risk without any risk controls) is used to calculate residual risk.