Energy Credit Best Practices – Chapter: Information Technology http://ccro.org © Copyright 2022, CCRO. All rights reserved. 18 3. Information Technology Best Practices 3.1 Data Management 3.1.1 Single System of Record Organizations which grow to a size where market and Credit Risk Systems are required are generally trading in multiple primary commodities, including oil, natural gas and electricity. This means that the market leading credit Information Systems are purpose-built to integrate Credit Risk data across multiple commodities. This “fit-for-purpose" functionality makes them a natural choice as a single system of record for Credit Risk data. CRMS Systems sit downstream from the ETRM’s and alongside the General Ledger or GL. A fit-for-purpose solution that integrates all the key elements of credit operations (e.g., counter parties, trading locations, governing laws, applicable contracts and terms, and all of the exposure across all types of trading the organization, is engaged in) is vital to successfully managing Credit Exposure. This is true now more than ever as trading instruments get more complex, the global economy is further integrated, and the webs of corporate inter-relations and mergers become more intricate. The following two Systems help maintain “the single system of record” • Document Management Systems – Companies will often deploy a centralized repository that stores financial, legal, HR, and corporate documents. Most of these Systems allow external access to these documents by remote systems through a hyperlink. In instances where agreements and other credit documents are stored in such a system, the Credit Group could link to these documents for easy access. • Master Data Management (MDM) - Having a single repository of all data used throughout the company would help to avoid replicating the same piece of data in multiple places. Counterparty data, including credit scores, letters of credit, and cash balances are a great example of a set of data that may end up existing in multiple places (ETRM), GL, ERPs, etc.). However, this is not often practical for larger corporations or Credit Groups operating in multiple markets. An MDM solution allows all these data sets to remain in synchronization. Real-Time, near Real-Time, or Streaming Data Modern advances in computing have started to allow Systems to process large datasets much faster, run processes in parallel, and incrementally update user views with new data vs. the old “wipe and reload” methods. The newer, more modern platforms take advantage of these technologies and offer credit managers the ability to perform credit analytics on a real-time or near real-time basis.