As defined by Statement on Management Accounting: Enterprise Risk Management: Frameworks, Elements and Integration , the amount of risk that remains after management has taken action to mitigate risk is not called assessed risk.
As defined by Statement on Management Accounting: Enterprise Risk Management: Frameworks, Elements and Integration , the amount of risk that remains after management has taken action to mitigate the risk is known as residual risk. There will almost always be some amount of residual risk.
The risk that remains after management has taken action to mitigate the risk is remaining risk, but that is not the term used for it.
According to investment portfolio theory, undiversifiable risk — also called market risk or systematic risk — is created by the fact that economic cycles affect all businesses, and publicly-held investments are traded in a market that can go up and down with economic news. In addition, undiversifiable risk includes a certain amount of risk caused by imperfect correlations between and among securities held in a portfolio that are intended to offset one another. All portfolios are subject to undiversifiable risk. However, undiversifiable risk is not the term used to describe the amount of risk that remains after management has taken action to mitigate risk according to Statement on Management Accounting: Enterprise Risk Management: Frameworks, Elements and Integration.
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