CIPS L4M4 VALID EXAM GUIDE, FLEXIBLE L4M4 TESTING ENGINE

CIPS L4M4 Valid Exam Guide, Flexible L4M4 Testing Engine

CIPS L4M4 Valid Exam Guide, Flexible L4M4 Testing Engine

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CIPS Ethical and Responsible Sourcing Sample Questions (Q148-Q153):

NEW QUESTION # 148
How can a buyer monitor a supplier's ethical workforce standards throughout a long-term contract?

  • A. Contact management directly on a periodic basis, as stipulated in contract terms
  • B. Commission periodic audits by specialist third parties to highlight any malpractice
  • C. Check the International Labour Organisation's database regularly for information specifically about that supplier
  • D. Request a completed self-assessment by the supplier on a monthly basis

Answer: B

Explanation:
Conducting periodic audits by third-party specialists is a reliable way to monitor compliance with ethical standards, as these audits provide an objective assessment. This aligns with ethical sourcing practices, as it promotes accountability and ensures continuous adherence to agreed-upon standards.


NEW QUESTION # 149
Kiran is appraising some potential suppliers and has noticed that one of these suppliers has an extremely high gearing ratio. What would this suggest?

  • A. the supplier has a high cost of sales
  • B. the supplier has a lot of long-term debt
  • C. the supplier has a strong return on investment
  • D. the supplier is extremely profitable

Answer: B

Explanation:
The correct answer is 'the supplier has a lot of long-term debt'. Gearing is a measure of how the business is being funded and looks at the ratio of debt to equity. For example if they have taken out lots of loans and mortgages, this would equate to a lot of debt which means a poor gearing ratio.
Gearing is a hot topic for the exam.


NEW QUESTION # 150
A business may be faced with the challenge of deciding whether to source some of its requirements from external suppliers or whether to make them internally. Which of the following factors is likely to justify the decision to make the requirements internally?

  • A. The other suppliers are using older technology
  • B. External suppliers are likely to be overcharging
  • C. The availability of in-house competencies and capacity to carry out the production
  • D. External sourcing involves cumbersome tendering procedures

Answer: C

Explanation:
Internal production is often justified when a company has the necessary competencies and capacity. This approach aligns with responsible sourcing by leveraging internal capabilities for better control over quality, cost, and compliance with ethical and environmental standards.


NEW QUESTION # 151
Pre-qualification of suppliers is used to determine if the suppliers meet the basic requirements of the buying organisation. Which of the following is assessed at the pre-qualification stage?

  • A. capacity, capability and pricing structure
  • B. financial stability, capacity and capability
  • C. pricing structure, ethics and financial stability
  • D. capability, culture and pricing schedules

Answer: B

Explanation:
The correct answer is financial stability (this is done by using all of those lovely ratios in chapter 1.3) and capacity and capability (which are part of Carter's 10 Cs).
At PQQ stage you're looking purely at whether the supplier is good or bad (to put it simply). You don't give them details of your requirement yet, so they're not providing a quote / pricing structure / price schedule at this point in time. That would be at the next stage, IF they pass PQQ, when you issue the tender competition.


NEW QUESTION # 152
A company has a requirement for an item that has been identified as strategic on the positioning model. The company needs to invite competitive tenders and ensure the selected supplier of this item is in a good financial position. What should the company ask the suppliers to send to show that their current assets cover their current liabilities?

  • A. Acid test
  • B. Profit and loss account
  • C. Annual turnover
  • D. Gearing ratio

Answer: A

Explanation:
The acid test (quick ratio) is an effective measure of a supplier's ability to meet short-term liabilities, providing insights into financial stability. This aligns with responsible sourcing by ensuring the supplier is financially capable of fulfilling a strategic contract.


NEW QUESTION # 153
......

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