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FRM Part II · FRM Exam Part II · Guidance on Managing Outsourcing Risk

A bank's contract with a cloud provider sets a monthly availability SLA of 99.9% over a 30-day month (720 hours). Monitoring reports show the provider was unavailable for a total of 1.2 hours that month. What is the measured availability and does it meet the SLA?

Measured availability is 99.83%, calculated as 718.8 divided by 720 hours. The SLA allows only 0.72 hours of downtime in the month, and 1.2 hours were lost, so the provider breached the 99.9% target and the bank should escalate.

  1. A99.83%; the SLA is breachedCorrect
  2. B99.93%; the SLA is met
  3. C99.83%; the SLA is met
  4. D99.88%; the SLA is breached

Explanation

Availability = (720 - 1.2)/720 = 718.8/720 = 99.833%. The allowed downtime is 0.1% x 720 = 0.72 hours, and 1.2 hours exceeds it, so the SLA is breached. The 99.93% option mistakenly uses a wrong downtime figure.

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