Energy Credit Best Practices – Chapter: Information Technology http://ccro.org © Copyright 2022, CCRO. All rights reserved. 33 accessible globally from the internet. There are three basic types of cloud services: Software as a service (SaaS), Infrastructure as a service (IaaS), Platform as a service (PaaS). Cognitive Analytics - Intelligence and analytics based on Artificial Intelligence and Machine Learning. This set of information focuses on scenarios where there may be other influencers or variables that are not currently known. Computer Security Resource Center (CSRC) - Provides the public with NIST resources on computer, cyber, and Information Security and privacy. Confidence Interval - A measure of the degree of confidence, or equivalently the probability that is associated with the set of outcomes, for a random variable (or a stochastic process) of interest. A confidence level of α is defined as the probability that, given the underlying distribution of the random variable (or process), the set of possible outcomes will lie in a range greater than or equal to a predetermined value. Equivalently, a confidence level of (1 – α) is defined as the probability that the set of outcomes will lie in a range less than or equal to a predetermined value. As an example, a confidence level of 5% is used to assess the set of possible outcomes and assign a probability of 1 in 20 that the actual outcome will lie above a predetermined value, the latter being a function of the underlying distribution and the level of confidence being used. Alternatively, a confidence level of 95% is used to assess the set of possible outcomes and assign a probability of 19 out of 20 that the actual outcome will lie below the predetermined value. Credit Exposure – Is the sum of Current Exposure and Potential Future Exposure. Credit Group – the credit department of an organization, including any key stakeholders to the credit function (for example the Chief Risk Officer and/or the Chief Financial Officer). Depending on the size and sophistication of the credit function, this could include credit analysts, credit managers, directors of credit, and Chief Credit Officers. Credit Information Ecosystem – Is all encompassing term that captures all aspects of the counterparty/customer, data, processes, and System s tasked with managing credit risk. It would include items both external and internal to the organization and it is understood that individual components within the Ecosystem, as well as the System would likely evolve over time. The components in the Ecosystem include, but are not limited to, the credit team, senior management, all credit-related data, 3rd party entities (banks, data providers, insurance providers, exchanges, etc), System s and other software tools, and business processes.” Credit Risk - Credit risk is the market risk exposure to its counterparties or customers’ credit quality. The risk is the counterparties or Customers’ ability to make contractual payments or deliver a specified energy commodity, product, or service. For instance, a trading operation may purchase a forward position from counterparty A to hedge an open position, but if counterparty A defaults, the previously hedged position may run afoul. Credit Risk Management System - (CRMS) - The integrated System responsible for managing data specific to the credit department and for producing the Credit Exposure. Typical data and processes managed with the CRMS include counterparty (or 3rd party legal entity) data, contract terms related to credit (e.g., netting terms, covered products, adequate assurances, material adverse change clauses and others), collateral (e.g., letters of credit, guarantees, credit support annexes, etc), credit limits, credit analytics, and credit reporting. Cross-Commodity Risk - Cross commodity hedging or cross hedging represents a risk trading strategy when a trader trades hedge positions on two positively correlated commodities