Which of the following is a key risk associated with an entity's IT systems?

The key risk associated with an entity's IT systems is hacking or fraudulent theft of funds. This risk is particularly significant as it pertains to the integrity and security of financial information. In today's digital landscape, cyber threats such as hacking are prevalent, and they can lead to severe financial losses, reputational damage, and legal consequences for an organization.

Hacking can involve unauthorized access to financial systems, allowing malicious actors to manipulate data, steal funds, or cause disruptions. Given the increasing sophistication of cybercriminals, organizations must implement robust security measures, maintain strong internal controls, and ensure compliance with relevant regulations to mitigate the risks posed by such threats.

While outdated software, employee miscommunication, and insufficient data storage can certainly lead to operational issues and inefficiencies, they do not directly pose the immediacy and severity of risk that hacking presents. Hacking directly threatens the organization’s assets and can lead to catastrophic outcomes, making it a paramount concern in the realm of IT risk management.