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APPENDIX 8.5-1

RISK ASSESSMENT

Risk = Likelihood (L) x Severity (S)

Table 1: Likelihood of an Occurrence

Likelihood (L) Description Rating

Most likely result of the issue being realized
Most Likely 5
(75% and above)
Has a good chance of occurring and is not unusual
Possible 4
(50 - 74%)
Might occur sometime in the future
Conceivable 3
(25 - 49%)
Has not been known to occur after many years
Remote 2
(10 - 24%)
Practically impossible and has never occurred
Inconceivable 1
(less than 10%)

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Table 2: Severity of Impact

Severity (S) Description Rating

Operation cost increases Potentially destroying the entire

Critical 5
more than 30% organisation in the long run

Negative impact that will require hard

Operation cost increases
High work from management to manage the 4
between 20 - 30%
issue
Continuous negative impact that
Operation cost increases
Moderate requires work / planning from 3
between 8 - 20%
management to manage the issue

Operation cost increases Impact can be absorbed / managed with

Low 2
between 2 - 8% minimal management effort

Operation cost increases by Impact can be absorbed / controlled

Negligible 1
less than 2% through routine activities

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Table 3: Risk Matrix

Severity (S)
Likelihood (L) 1 2 3 4 5
5 5 10 15 20 25
4 4 8 12 16 20
3 3 6 9 12 15
2 2 4 6 8 10
1 1 2 3 4 5

Table 4: Action Priority

Risk Level Action

1 - 4: Low Risk may be considered as acceptable and further reduction may not be necessary
5 - 12: Medium Requires a planned approach to control the risk and applies temporary measure if required
15 - 25: High Requires immediate action to control

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