---
sourceDocument: Yokohama Governance, Risk, and Compliance
sourceDocumentLink: https://servicenow-prod.fluidtopics.net/r/yokohama/governance-risk-compliance

 Release :

    - yokohama

ft:locale :

    - en-US

ft:publication_title :

    - Yokohama Governance, Risk, and Compliance

ft:clusterId :

    - grc

bundleId :

    - grc

workflow :

    - Technology


---

# Define risk statement hierarchy

# Define risk statement hierarchy {#ariaid-title1}

* Release version: Yokohama
* 
* Updated January 30, 2025
* 
* ![](https://www.servicenow.com/docs/portal-asset/ico-clock) 2 minutes to read

Risk managers establish parent and child relationships on the risk statement
form.

## Before you begin

Role required: sn_risk.manager

## Procedure

1. Navigate to AllRiskRisk LibraryRisk Statements.
2. Click New.
3. On the form, fill in the fields.  
   Note:  
   When any of the following statement fields changes: Name, Description, Reference, Category, Type, Classification, and Attestation, all the associated controls and risks are updated, and their state is set back to Draft.
   {#create-risk-state-hierarchy__table_FloorForm__entry__2}

   | Field | Description |
   |-|-|
   | Name | Name of the risk statement. |
   | Parent \* this field is visible only when Advanced Risk has been downloaded. | Parent risk statement to this risk statement. * Users select the appropriate parent from the taxonomy structure. * If no parent is specified, the risk statement becomes the root of the tree. * It is possible to have several of these root-type risk statements within the organization. * A risk statement cannot be both a parent and a child of another risk statement. {#create-risk-state-hierarchy__ul_jp1_333_33b} |
   | Framework | Framework this risk statement is associated with. |
   | Category | Choose a category. * Legal * Financial * Operational * Reputational * Legal/Regulatory * Credit * Market * IT {#create-risk-state-hierarchy__ul_scd_j2k_kv} |
   | Assessment | Assessment associated with this risk statement. |
   | Issue group rule | Issue group rule assigned to this risk statement for reporting and dashboard. |
   | Description | Description of the risk statement. |
   | Additional information | Additional information for this risk statement. |
   | Default Scores ||
   | Inherent SLE | Monetary value of a risk if it occurs before any mitigation strategies are in place. |
   | Residual SLE | Monetary value of a risk if it occurs after all mitigation strategies are in place. |
   | Inherent ARO | Probability that a risk occurs in any given year before any mitigation strategies are in place. |
   | Residual ARO | Probability that a risk will occur in any given year after all mitigation strategies are in place. |
   | Risk Rollup and Tolerance \* this tab is visible only when Advanced Risk has been downloaded. ||
   | Expected ALE | Enter currency and amount for the expected ALE. Note: This value must be less than or equal to the Maximum acceptable ALE. |
   | Maximum acceptable ALE | Enter currency and amount for the maximum acceptable ALE. Note: This value must be greater than or equal to theExpected ALE. |
   | Sum of calculated ALE | This is a calculation based on all the underlying risks or risk statements. |
   | Average calculated ALE | This is a calculation based on all the underlying risks or risk statements. |
   | Maximum calculated ALE | This is a calculation based on all the underlying risks or risk statements. |
   | Minimum calculated ALE | This is a calculation based on all the underlying risks or risk statements. |
   | Tolerance Status | Automatically calculated based on tolerance values. * If the Calculated ALE is less than or equal to the Expected ALE = Acceptable in green * If the Calculated ALE is greater than the Expected ALE, but less than or equal to the Max acceptable ALE = Needs Attention in orange * If the Calculated ALE is greater than the Maximum acceptable ALE = Unacceptable in red {#create-risk-state-hierarchy__ul_mxp_sfj_33b} |
   | Calculated Score | The corresponding score for the calculated ALE: * Low * Med * High {#create-risk-state-hierarchy__ul_yqg_pbj_33b} |
   [Table 1. Risk Statement from]

   {#create-risk-state-hierarchy__table_FloorForm}
4. Click Submit.
5. To add children risk statements, click the Risk Statements related list, and click New.
6. Fill in the fields on the form, as appropriate and click Submit.  

   <br />

7. Repeat until you have added all the children risk statements related to this risk statement.
{#create-risk-state-hierarchy__steps_krx_t1k_kv}

*[\>]: and then