Exposure factor (EF) is the subjective, potential
percentage
In mathematics, a percentage (from la, per centum, "by a hundred") is a number or ratio expressed as a fraction of 100. It is often denoted using the percent sign, "%", although the abbreviations "pct.", "pct" and sometimes "pc" are also us ...
of
loss
Loss may refer to:
Arts, entertainment, and media Music
* ''Loss'' (Bass Communion album) (2006)
* ''Loss'' (Mull Historical Society album) (2001)
*"Loss", a song by God Is an Astronaut from their self-titled album (2008)
* Losses "(Lil Tjay son ...
to a specific
asset
In financial accountancy, financial accounting, an asset is any resource owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that can be used to produce positive economic value. Assets represent value ...
if a specific threat is realized. The exposure factor is a
subjective value that the person assessing
risk
In simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environme ...
must define.
The exposure factor is represented in the impact of the risk over the asset, or percentage of asset lost. As an example, if the
asset value
In financial accounting, an asset is any resource owned or controlled by a business or an economic entity. It is anything (tangible or intangible) that can be used to produce positive economic value. Assets represent value of ownership that can ...
is reduced two thirds, the exposure factor value is 0.66. If the asset is completely lost, the exposure factor is 1.0.
Financial risk management
{{business-term-stub