Compensating controls are additional or alternative controls that are implemented when the existing controls are found to be ineffective or do not meet the required standards. Compensating controls are designed to reduce the risk exposure to an acceptable level and ensure that the organization can still comply with the relevant regulations and industry best practices. For an organization that processes credit cards, compensating controls may include enhanced encryption, monitoring, auditing, or authentication mechanisms. By having compensating controls in place, the organization can maintain an effective overall control environment despitethe deficiencies in the existing controls. The other options are not correct because they do not ensure that the overall control environment is effective. A control mitigation plan is a document that outlines the actions and resources needed to address the control deficiencies, but it does not guarantee that the compensating controls will be implemented or effective. Risk management is a process that involves identifying, analyzing, evaluating, and treating risks, but it does not directly affect the control environment. Residual risk is the risk that remains after the risk treatment, and it may or may not be acceptable depending on the risk appetite of the organization. References = CRISC Review Manual, pages
153-1541; CRISC Review Questions, Answers & Explanations Manual, page 632