CIPS L4M4 : Ethical and Responsible Sourcing

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CIPS L4M4 Exam Syllabus Topics:

Reference: https://www.cips.org/qualifications/diploma-in-procurement-supply/ethical-and-responsible-sourcing

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CIPS Ethical and Responsible Sourcing Sample Questions:

Question #1
A balance sheet will show a company's assets, liabilities and shareholder equity. What is share-holder equity?

A. the amount of money from retained earnings
B. the profit from sales once tax has been deducted
C. the amount of money held in the company's bank account
D. the owners' residual claim once all debt has been paid

Question #2
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?

A. 300 ÷ 150
B. (300 - 200 - 150) × 100
C. (300 - 200) ÷ 150
D. (300 ÷ 150) × 100

Question #3
A buyer is responsible for the procurement of metals within the raw materials department. The buyer is preparing for next year's purchase orders and has been asked to confirm the month of order placement. The buyer has found three trends:
In January and April, the supplier's local currency is stronger
November typically has the lowest demand
May typically has the highest demand
Which month should the buyer plan to place the purchase order?

A. November
B. May
C. January
D. April

Question #4
Which of the following payment mechanisms is most beneficial to the supplier?

A. sight draft
B. cash in advance
C. open account
D. letter of credit

Question #5
Which of the following is a UK legislation concerning product safety?

A. Consumer Rights Act 2015
B. Enterprise Act 2002
C. GDPR 2018
D. Competition Act 1998

Solutions: