An organization that conducts business globally is planning to utilize a third-party service provider to process payroll information. Which of the following issues poses the GREATEST risk to the organization?
An organization that conducts business globally is planning to utilize a third-party service provider to process payroll information. Which of the following issues poses the GREATEST risk to the organization?
The greatest risk to the organization is that the third party has not provided evidence of compliance with local regulations where data is generated. When conducting business globally, adherence to local regulations, especially those related to data protection and privacy, is crucial to avoid legal consequences, financial penalties, and damage to the organization’s reputation. Ensuring that the third-party service provider complies with these regulations is essential before entrusting them with sensitive payroll information.
Agreed should be A
I'm thinking this is A. "The third party has not provided evidence of compliance with local regulations where data is generated." As this could be a major legal issue for the organization. I don't think it's an indemnity clause because that would be a huge help for the vendor/3rd party and not the organization. An indemnity clause would limit or put a cap on the amount the org. could sue for each record, so again it would benefit the vendor/3rdparty.
option A, where the third party has not provided evidence of compliance with local regulations where data is generated, poses the greatest risk to the organization. When conducting business globally, it is crucial to adhere to local regulations, especially when handling sensitive information such as payroll data. Failing to comply with these regulations could lead to legal consequences, financial penalties, and damage to the organization's reputation. Therefore, it is essential for the organization to ensure that the third-party service provider can demonstrate compliance with local regulations before entrusting them with sensitive payroll information.
A. The third party has not provided evidence of compliance with local regulations where data is generated.
The third party has its own responsibility to check whether it can fulfil the requirements of local regulations. The greatest risk is then answer D for the global organization.
I vote A. Just think of data sovereignty and what that entails.
A global organization processing payroll information likely deals with sensitive and personal employee data, including financial and personal information. If the third-party service provider does not comply with local regulations in the regions where the data is generated, it could lead to legal and regulatory issues. Non-compliance with local data protection and privacy laws can result in significant fines and legal consequences for the organization.
I think correct answer is C. Because if no guarantee for uptime, then greatest risk on paying to employees if any outage during pay date.
I would think it would be option C since it compromises on the Availability part of the CIA triad. Option A is incorrect in my opinion as being non-compliant isn't the greatest risk.