Pass Guaranteed Quiz 2026 High Pass-Rate CIPS L5M5 Certification Practice
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CIPS L5M5 Exam Syllabus Topics:
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CIPS Managing Ethical Procurement and Supply (L5M5) Sample Questions (Q82-Q87):
NEW QUESTION # 82
What is the term for a clause in a contract that, if breached, allows the injured party to claim damages but does not result in the termination of the contract?
- A. Condition
- B. Innominate term
- C. Representation
- D. Warranty
Answer: D
Explanation:
Choice C- A warranty in a contract is a term that, if breached, allows the injured party to claim damages but does not give them the right to terminate the entire contract. Therefore, this is the answer.
Incorrect answer:
Choice A- A representation is a statement made by one party to another, often during pre-contractual negotiations, to induce them to enter into a contract. Representations are not terms of the contract, so their breach does not directly impact the contract itself in the same way as a condition, warranty, or innominate term. Since the question specifies a contractual clause, representation cannot be the correct answer.
Choice B- A condition is a fundamental term of the contract. Breaching a condition gives the injured party the right to: Terminate the contract, and Claim damages. The question explicitly states that the clause should not allow for termination of the contract. Therefore, a condition does not fit the criteria.
Choice D- An innominate term does not have a predefined classification as a condition or warranty. Its treatment depends on the severity of the breach: If the breach is serious, it could lead to termination (similar to a condition) or if the breach is minor, it only results in damages (similar to a warranty). Since the question specifies a clause that does not allow for termination regardless of the breach's impact, this term is too flexible to be the correct answer.
Reference:
LO-2.2; Page 190-191; Monitoring Contract Performance
NEW QUESTION # 83
Which of the following are tools that a company can use to improve ethics and sustainability across the supply chain? Select THREE
- A. On-Site Audits
- B. Cost Analysis
- C. Supplier Preferencing
- D. Benchmarking
- E. Supply Chain Mapping
Answer: A,D,E
Explanation:
Comprehensive and Detailed Explanation From Exact Extract of Documents:
The L5M5 study guide highlights several tools procurement can use to embed ethics and sustainability into supply chains. These include benchmarking (A), which compares practices against best-in-class organisations; supply chain mapping (C), which provides visibility of all tiers of suppliers to identify risks; and on-site audits (D), which verify supplier compliance with ethical standards directly. Supplier preferencing (B) is a portfolio analysis tool used to understand suppliers' perspectives, not specifically an ethical improvement tool. Cost analysis (E) is primarily financial and does not ensure ethical compliance. Procurement professionals must apply tools like mapping and audits to identify risks such as forced labour, environmental harm, or corruption.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, section on supplier evaluation and sustainability tools
NEW QUESTION # 84
A procurement officer at a global retail company is responsible for sourcing raw materials for a new product line. With the company committed to ethical sourcing practices, including Fair Trade, the officer aims to clearly communicate Fair Trade requirements to potential suppliers. Where should these requirements be included to ensure compliance?
- A. In internal emails to the procurement team
- B. In the specifications section of the tender document
- C. During supplier performance review meetings after contracts are signed
- D. In the company's annual sustainability report
Answer: B
Explanation:
Choice B- Fair Trade requirements must be included in the specifications section of the tender documents so that potential suppliers are aware of and can comply with these requirements before submitting bids or entering into agreements.
Other options, like internal communications or sustainability reports, do not effectively communicate requirements to suppliers in a legally enforceable way.
Reference:
LO-3.3; Page 311-312; Fairtrade standards that affect the workplace and producers and their implications for procurement and supply
NEW QUESTION # 85
The Rampal Power Station, a 1320 MW coal-fired power plant, has recently faced accusations of poor health and safety standards in the workplace. Workers have reported being forced to work without safety masks, exposing them to air pollution. If Rampal Power Station fails to improve its health and safety standards, which of the following is the most likely primary consequence?
- A. Complexity in calculating insurance coverage
- B. Acquisition of poor quality materials from suppliers
- C. Destruction of the environment
- D. Loss of reputation
Answer: D
Explanation:
Choice B - Loss of reputation and damage to brand is a primary consequence of poor safety standards in the workplace for the power plant.
Incorrect answer:
Choice A - This option suggests that poor health and safety standards might lead to a decrease in the quality of materials sourced. While safety issues can affect worker performance and productivity, they do not directly relate to the quality of materials acquired from suppliers. Poor health and safety standards are more likely to impact employee morale and retention rather than the procurement process.
Choice C -Environmental effect is an indirect consequence for Rampal power plant but more so to the locals living there and natural habitat. If health and safety standards are not improved, it could lead to environmental issues, but this would be a broader consequence rather than a primary one related to workplace conditions.
Choice D-Although in cases of workers injury or death, calculating insurance would be complex, as not all injury and health related costs are covered by insurance, like sick pay, lost time, fines etc. But this is more of a secondary internal challenge and not a primary consequence of the power plant.
Reference:
LO-1.3; Page 99-100; Health and safety standards
NEW QUESTION # 86
Which of the following statements is TRUE about the adjudication form of dispute resolution? Select TWO
- A. It is quicker than going through the courts
- B. The decision cannot be legally binding
- C. A decision must be made within 28 days
- D. It is an informal process
Answer: A,C
Explanation:
Comprehensive and Detailed Explanation From Exact Extract of Documents:
Adjudication is a formal ADR method, widely used in construction and supply disputes. The L5M5 study guide (p.237) outlines its key features: it is designed to be faster than court proceedings and legally requires that a decision is reached within 28 days of referral. Decisions made can also be legally binding. Contrary to option A, adjudication is not informal; it follows structured legal processes. Option D is also incorrect, as adjudicator decisions may carry binding authority unless overturned later in arbitration or litigation. The process ensures disputes are resolved promptly, preventing long project delays.
Reference: Managing Ethical Procurement and Supply (L5M5) Study Guide, p.237
NEW QUESTION # 87
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