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ACCA Applied Skills · Performance Management · Uses and control of information

A finance director is concerned about the risks of storing the company's management information with a public cloud provider. Which of the following is a genuine risk of this approach?

The genuine risk is reduced control. Data is held by a third party, so the company has less direct influence over its security, storage location and availability, raising privacy, regulatory and dependency concerns. Scalability and avoiding hardware purchases are benefits, and cloud software normally supports many users at once.

  1. AThe company loses the ability to scale its capacity
  2. BThe company must buy and maintain its own hardware
  3. CData is held by a third party, so the company has less direct control over its security, location and availabilityCorrect
  4. DThe provider's software can only be used by one user at a time

Explanation

Using a third-party provider reduces direct control over where data is stored, how it is secured and whether the service is available, creating security, privacy, regulatory and dependency risks. Scalability is a benefit of the cloud, not a risk. Avoiding hardware purchase is also a benefit, and cloud services support many simultaneous users.

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