- the actual degree of severity, size of intensity that describes the observed extent of the presence of operational risk;
- the frequency of risk existence and measuring their parameters – the frequency describes the number of times a risk of a given size occurs within a given period of time;
- the context-dependency relation, which may differ in certain situations; and
- the possible correlation and its sign with other indicators based on the common parameters among all indicators (Kalyvas and Akkizidiz 2006).
- In addition, KRIs should have the following characteristics in order to be used as a tool to management operational risk:
- the data must be available;
- the data must be quantifiable in either percentage, value or volume;
- a tolerance threshold must be determined by management and must only change according to changing circumstances, and
- the KRIs must be monitored on a regular basis.