What does the Annualized Rate of Occurrence (ARO) measure?

The Annualized Rate of Occurrence (ARO) specifically measures how many times a particular threat or risk is expected to occur within a year. It is a critical metric in risk management and is used in conjunction with other metrics, such as the Single Loss Expectancy (SLE) and the Annual Loss Expectancy (ALE), to help organizations assess and quantify their risks effectively. By determining the ARO, an organization can understand the frequency of potential incidents and factor this into its overall risk assessment and mitigation strategies.

This measure assists decision-makers in prioritizing risks and allocating resources appropriately by providing a clear picture of the frequency of specific threats or vulnerabilities over the course of a year. Understanding the ARO helps organizations to anticipate potential impacts and to prepare adequately for incidents that are expected to recur based on historical data and analysis.