Here are some important definitions to keep in mind:

• AV = Asset Value (Expressed in dollars)
• EF = Exposure factor (Expressed as a percentage of the asset value)
• SLE = Single Loss Expectancy
• ALE = Annual Loss Expectancy
• ARO = Annual Rate of Occurrence (Number of exposures or incidents that could be expected per year)

Here are the formulas used:

• SLE = AV ($) * EF (%)
• ALE = SLE * ARO

Calculate Single Loss Expectancy

Asset Value

Exposure Factor

Single Loss Expectancy

Calculate Annual Loss Expectancy

Single Loss Expectancy

Annual Rate of Occurrence

Annual Loss Expectancy