L4M4 Practice Questions

The best way to deal with potential Conflicts of Interest is to openly declare these. Just because you

have a relationship with someone doesn't mean this is going to be an issue or lead to fraud, but it is a

good idea to keep a written record of these.

It wouldn't be a risk register, because how can you rate someone's risk of doing something dodgy?

Risk registers are for objective risks such as Health and Safety.

The lowest risk to the buyer is 'delivered duty paid'. This is because the supplier does all the work

transporting the items to the buyer's premises. Incoterms_2020_chart | Intersped

Incoterms can replace lengthy contract clauses as they replace the need for contracts to detail which

party is responsible for organising transport, paying duties, having the insurance etc.

Incoterms is an odd one for exam topics- some students say it was a huge part of their exam and

there were many questions on this. Others said there were just one or two. Questions get randomly

assigned from the bank so it's completely random how many you'll get on this topic.

In a 'Credit Account' payment mechanism- the supplier receives payment after the goods are

delivered, in line with agreed payment terms (which may be 30 days or something like that).

economic indices and comparison websites are secondary sources of data. The other three are

examples of primary sources of data.

Primary= you get the data yourself

Secondary = you find the data from somewhere else

A full competitive tendering process ensures fairness by treating all suppliers equally, allowing them

to compete on a level playing field. This aligns with ethical sourcing principles, especially in the

public sector, where transparency and equal opportunity are paramount.

Shareholder Equity = Total Assets - Total Liabilities

CIPS members who adhere to the CIPS Code of Conduct gain insight into ethical business practices

and retain their membership and access to CIPS resources. This commitment to ethical standards

supports responsible sourcing by fostering a community of professionals who value integrity and best

practices.

Capacity and compatibility are critical factors in supplier appraisal. Evaluating these factors ensures

that the supplier can meet the buyer’s requirements in terms of production capacity and aligns with

responsible sourcing by ensuring the supplier’s values and practices are compatible with the buyer’s

expectations.

Accepting an invitation under such circumstances would violate ethical standards, as it could create a

conflict of interest. Ethical sourcing and procurement practices require impartiality, and any

perceived favoritism or bias can harm the organisation's integrity.