Risk factors depend on variables such as the severity of the risk, likelihood a particular risk occurs and the types of risks that they are willing to take. The severity of a risk can be severe, critical, significant, or minor and the frequency can be frequent, infrequent, or occasional. The combination of these two variables can show the level of impact. particular risk could potentially have. Companies also have to decide what, if any risks they are willing to take are, how each risk will be addressed, and the comparison of the risk to any possible reward.