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NEW QUESTION # 155
A buyer is procuring metals. The following trends are observed:
* January and April: supplier's local currency is strong
* November: demand is lowest
* May: demand is highest
Which month should the buyer place the order?
Answer: A
Explanation:
Demand and currency fluctuations affect commodity pricing. November shows lowest demand, which usually reduces price pressure. Conversely, May (high demand) and months with strong supplier currencies (January, April) would increase costs. By ordering in November, the buyer leverages demand cycles to obtain lower prices. Responsible sourcing requires buyers to monitor market intelligence and seasonal trends to time purchases effectively, mitigating risks of price volatility while ensuring supply continuity. This reflects CIPS' s emphasis on category management and proactive procurement planning.
Reference: CIPS L4M4 Study Guide (v2), LO: "Application" - demand cycles, timing of orders, commodity sourcing.
NEW QUESTION # 156
In the Public Sector, what is the evaluation criteria most often used when evaluating bids fromsuppliers?
Answer: C
Explanation:
Most Economically Advantageous Tender (MEAT) is the Public Sector's go to evaluation criteria.
NOTE that this is changing from October 2023. Public Sector Procurement is currently based on legislation called PCR 2015 which itself is based on EU Procurement Directives. Now the UK has officially Brexited, we're making our own laws and the new Procurement Bill will be coming into effect in November 2024. One of the major changes is that MEAT is changing to MAT (most ad-vantageous tender - without the economical bit).
If you're sitting this exam until July 2024- you're fine- learn what the study guide says. If you're taking the exam from November 2024 I'm not sure what students are expected to do. The entire section on public sector procurement is incorrect for you. My best guess is CIPS may remove questions this section as the study guide will be wrong, but I really don't know how they plan to handle this.
The new Procurement Bill - MEAT to MAT - Hempsons - Hempsons
NEW QUESTION # 157
Brooklyn Ltd is a manufacturer of windows and has a single sourcing relationship with their supplier of glass.
What relationship style would be best suited?
Answer: D
Explanation:
When single sourcing, you should aim to have a collaborative relationship with the supplier. They're the only ones who provide you with glass, which is a vital part of windows. So you need to make sure you have a good relationship with them and work with them to overcome any issues such as supply chain disruptions. If not- you've got no windows to sell!
NEW QUESTION # 158
The procurement manager has received the following data from the supplier's accounts to facilitate the calculation of the supplier's current ratio:
Current Assets: Stock $200; Debtors $60; Cash $40; Total $300
Short Term Liabilities: Bank overdraft $150
Which calculation will the procurement manager use to find out the current ratio?
Answer: D
Explanation:
The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations. It is calculated by dividing current assets by current liabilities. In this case:
Current Assets = $300
Current Liabilities = $150
Current Ratio = 300 ÷ 150 = 2.0
This indicates that the supplier has twice as many current assets as current liabilities, suggesting good short- term financial health.
Reference:
CIPS Level 4 Diploma in Procurement and Supply, L4M4 Study Guide, Section 2.3: Financial Appraisal of Suppliers
NEW QUESTION # 159
"Phishing" occurs when an employee receives a false email that appears genuine, exposing the organisation to cybercrime. Which crime category does this fall under?
Answer: B
Explanation:
Phishing is a form of fraud, where deception is used to gain financial advantage or access to sensitive data. It is not corruption (misuse of power), bribery (offering inducements), or a human rights issue. Procurement professionals must be alert to fraud risks in supply chains, including cyber-enabled risks such as phishing and invoice fraud. Responsible sourcing extends to protecting organisational data and finances against such attacks, often through robust controls, training, and supplier verification procedures.
Reference: CIPS L4M4 Study Guide (v2), LO: "Concepts" - fraud, corruption, and ethical risks in supply chains.
NEW QUESTION # 160
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