If a team is struggling to project financial losses from a risk, what should they pursue to evaluate the potential impact?

Choosing a qualitative approach to evaluate the potential impact of financial losses from a risk is appropriate because it allows the team to assess the scenario without relying solely on precise quantitative metrics, which may not always be feasible, especially when data is uncertain or incomplete. Qualitative analysis involves identifying and categorizing risks based on their likelihood and impact, often utilizing expert judgment and scenario analysis.

This approach enables the team to understand the relative severity of different risks and their potential effects on the organization, even if exact figures for financial losses are difficult to determine. By focusing on qualitative measures, such as assessing the potential for operational disruption, regulatory implications, or reputational harm, the team can gain valuable insights into risk prioritization and management strategies.

In contrast, other options suggest methodologies that may not address the immediate concern effectively. Computing amortization primarily relates to asset management and doesn't directly inform the future risks or losses associated with those assets. Calculating a return on investment is more suitable for evaluating the performance of specific investments rather than assessing risks. Spending excessive time trying to define an exact loss amount may delay necessary actions and decision-making, especially when risks often present a range of potential impacts rather than clear-cut numerical estimates.