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ACCA Strategic Professional · Strategic Business Leader · Cloud, mobile and smart technology

Orrin Bank, regulated in country A, wants to use a public cloud SaaS provider whose data centres are located in several other countries and which relies on a single provider for all its core services. The board's risk committee must prioritise the response. Which combination of risks is MOST significant and best addressed by a cloud risk strategy before contract signature?

The most significant combination is regulatory and data residency non-compliance plus concentration and lock-in risk. A regulated bank storing data abroad with one provider must secure location controls, audit rights and a workable exit plan before signing the contract.

  1. ARegulatory and data residency non-compliance together with concentration and exit (lock-in) riskCorrect
  2. BLower staff morale and increased travel costs
  3. CSlower time to market and reduced innovation
  4. DReduced need for IT skills and lower training costs

Explanation

A regulated bank holding data across borders faces compliance exposure on residency and oversight, and dependence on one provider creates concentration and lock-in risk making exit costly. These should be mitigated by contract clauses, location restrictions, exit plans and possibly multi-cloud. The other options describe minor or benefit-type effects.

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