Governance, Risk & Compliance professionals are often asked about control exceptions during interviews because they reveal how well you balance risk, business needs, and governance. A control exception is not just a deviation from policy; it reflects decision-making, risk awareness, and accountability. Interviewers want to understand how you assess exceptions, apply compensating controls, and ensure proper risk acceptance with governance approval and assurance.
This blog is designed to help interview candidates clearly understand GRC control exceptions and confidently answer real-world interview questions. The explanations are simple, practical, and aligned with how GRC works in organizations of all sizes.
Interview Questions and Answers on GRC Control Exceptions
A GRC control exception occurs when a required control is not followed or cannot be applied as designed. It is important to document and manage these exceptions to ensure risks are understood and properly addressed.
1. What is a GRC control exception?
Answer: A GRC control exception occurs when an established control cannot be followed fully due to operational, technical, or business constraints. Instead of ignoring the control, the exception is formally documented, assessed, approved, and monitored.
In GRC, control exceptions ensure transparency and accountability by clearly explaining why the control is not met, what risks are introduced, and how those risks are managed through compensating controls or risk acceptance.
2. Why do organizations allow control exceptions?
Answer: Organizations allow control exceptions to maintain business continuity while still managing risk. Not all controls can be applied uniformly across systems, vendors, or processes.
By allowing controlled exceptions, organizations avoid unnecessary disruption while ensuring governance approval, risk evaluation, and assurance activities are in place. This structured approach prevents informal bypassing of controls and strengthens overall compliance management.
3. How do you document a control exception?
Answer:
A well-documented control exception typically includes:
- Description of the control requirement and deviation
- Business justification for the exception
- Risk assessment outlining potential impact and likelihood
- Details of compensating controls
- Risk acceptance statement if applicable
- Governance approval and review timeline
This documentation ensures traceability and supports audit evidence collection and assurance activities.
4. What are compensating controls in the context of control exceptions?
Answer: Compensating controls are alternative measures implemented to reduce risk when a primary control cannot be followed.
For example, if automated access controls are unavailable, enhanced monitoring or manual reviews may serve as compensating controls. These controls must provide comparable risk reduction and should be validated through control testing to support assurance.
5. How do you assess risk for a control exception?
Answer: Risk assessment for a control exception involves evaluating the impact and likelihood of the risk introduced by the exception.
This assessment considers factors such as data sensitivity, system criticality, threat exposure, and control maturity. The results are recorded in the risk register and aligned with enterprise risk management practices to ensure consistent decision-making.
6. Who approves a control exception?
Answer: Control exceptions must receive governance approval from appropriate stakeholders, such as risk owners, compliance teams, or senior management.
Approval authority depends on the risk level. High-risk exceptions may require executive or board-level review, while low-risk exceptions can be approved at the operational level. This ensures accountability and alignment with governance structures.
7. What is risk acceptance in GRC control exceptions?
Answer: Risk acceptance means formally acknowledging and accepting residual risk when it cannot be fully mitigated.
In control exceptions, risk acceptance occurs when compensating controls reduce risk to an acceptable level, or when further mitigation is not feasible. This acceptance must be documented, approved, and reviewed periodically to maintain assurance.
8. How do control exceptions impact audits?
Answer: Control exceptions are closely reviewed during internal and external audits. Auditors expect clear documentation, governance approval, and evidence that risks are being managed.
Well-managed control exceptions demonstrate maturity in compliance management, while undocumented or expired exceptions can lead to audit findings, remediation planning, or corrective action plans.
9. How do you monitor and review control exceptions?
Answer: Control exceptions should have defined review periods and expiration dates.
Regular monitoring ensures that:
- Business justifications remain valid
- Compensating controls are operating effectively
- Risk levels have not increased
Ongoing monitoring supports continuous controls monitoring and provides assurance that exceptions do not become permanent weaknesses.
10. What role does assurance play in control exceptions?
Answer: Assurance provides confidence that control exceptions are managed effectively and do not expose the organization to unacceptable risk.
This includes control testing, validation of compensating controls, and independent reviews. Assurance activities help leadership trust that governance approval and risk acceptance decisions are sound and well-supported.
Conclusion
GRC control exceptions are a practical reality in governance and compliance programs. When managed correctly, they balance business needs with effective risk management. Interviewers look for candidates who understand not just the definition, but the full lifecycle of a control exception—from risk assessment and compensating controls to governance approval and assurance.
By explaining exceptions clearly, showing structured thinking, and emphasizing documentation and accountability, you demonstrate strong GRC maturity and readiness for real-world challenges.
