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Updated Nov-2025 Pass L4M4 Exam - Real Practice Test Questions
NEW QUESTION # 51
A public sector buyer has run a competitive tender, for which there were eight bidders. All bidders have met the public sector organisation's minimum standards. In addition, they must also meet several other requirements. The buyer will make the contract award decision based on which of the following?
- A. The supplier location
- B. Weighted criteria
- C. Framework agreement terms
- D. The bidder's price
Answer: B
Explanation:
Weighted criteria allow the buyer to evaluate multiple factors, not just price, to make a fair and balanced decision. This approach ensures responsible sourcing by considering quality, sustainability, and other relevant factors alongside cost, which aligns with public procurement ethics and standards.
NEW QUESTION # 52
Which of the following should be considered when calculating ratios relating to a supplier's liquidity?
- A. inventory
- B. reserves
- C. receivables
- D. profit
Answer: A
NEW QUESTION # 53
Jamilla is looking to find a new supplier who can deliver raw materials of wood and paper to her company Woody Manufacturing Incorporated. The requirement is for regular orders of high volume. She has issued a Request for Quotation. What will this assess the suppliers on?
- A. who can deliver the items the cheapest
- B. who can deliver the highest quality items
- C. which price is the most ethical
- D. the five rights of procurement
Answer: D
Explanation:
According to p.75 "a RFQ attempts to assess which supplier can achieve the Five Rights of Procurement".
Although price is the only factor considered when using a RFQ- it's important to consider this price in detail; can the supplier deliver the right QUALITY of product for this price?, can they deliver the item WHEN we need it for this price? etc.
The answer is not 'who will deliver it the cheapest' because Jamilla might not pick the cheapest sup-plier. If the cheapest supplier has inferior quality paper, or can only make deliveries every other Tuesday then Jamilla may not select them.
NEW QUESTION # 54
A buyer has been working with their business managers on a tender. The buyer is now assessing the tender proposals from the external market. Is it good practice for the procurement buyer to makesourcing recommendations?
- A. No, the buyer's recommendations are not relevant to the final sourcing decision, which must be taken by the business managers
- B. Yes, the procurement buyer can advise on the competitive proposal but should engage with the business managers about the decision to award the tender
- C. Yes, the procurement buyer should assess and take all decisions to award the tender independently of the business managers to avoid conflict of interest
- D. No, it is a lengthy, costly, and unnecessary step for the procurement buyer to engage business managers
Answer: B
Explanation:
Engaging with business managers while making sourcing recommendations ensures that the buyer considers multiple perspectives, reducing potential biases and improving decision-making. This approach aligns with ethical sourcing practices by promoting collaboration and transparency in tender decisions.
NEW QUESTION # 55
What is a risk of pre-warning a supplier that you will conduct an audit of their facilities?
- A. they will not perform regular duties that day
- B. they will not achieve KPIs
- C. they will not be able to make that time and date
- D. they may coach staff in what to say
Answer: D
NEW QUESTION # 56
Which of the following factors are typically considered when assessing a supplier's financial capacity?
- A. The supplier's profitability and asset levels
- B. The supplier's costing methods and markup percentage
- C. The supplier's compliance with regulations for minimum wages
- D. The price quoted in the request for quotation
Answer: A
Explanation:
Profitability and asset levels indicate a supplier's financial stability and ability to meet contract demands.
Responsible sourcing practices include assessing financial capacity to reduce risk in the supply chain and ensure long-term supplier viability.
NEW QUESTION # 57
Henry is importing cheese from South East Asia into the UK. He is doing some research on the costs and risks of this and has discovered that the product may be considered of 'non-preferential origin'. What implications would this mean for Henry?
- A. he will require insurance
- B. there are no duty charges or limitations
- C. the goods are subject to tariff quotas
- D. the goods are banned in the UK
Answer: C
Explanation:
Items of 'Non-Preferential Origin' are subject to tariff quotas and other customs commercial regulations.
'Preferential Origin' goods have no duties or tariffs.
The good news is CIPS have significantly simplified section 3.2 of the syllabus. The new study-guide is much lighter on names of documents and protocols for importing and quotas etc. The focus of this Learning Outcome has shifted more to Inco Terms so I would focus on that for revision, but do make sure you have a basic understanding of documents, law and jurisdiction.
NEW QUESTION # 58
In a negotiation, a supplier does not want to upset or offend the buyer, so concedes their own requirement in order to ensure harmony. Which negotiation tactic is the supplier using?
- A. competitive
- B. accommodating
- C. collaborative
- D. compromising
Answer: B
Explanation:
This is accommodating: the supplier puts the buyer's interest above his own.
This is from the Thomas Killman model of conflict resolution. There are 5 strategies; competitive, collaborative, avoiding, accommodating and compromising. In the study guide it doesn't mention the name of the model but you do need to know the 5 strategies. The model comes up a lot in other modules so is a good one to learn. Particularly L5M1 which is about management theory.
NEW QUESTION # 59
Which of the following is true for CIPS members who sign and comply with the CIPS Code of Conduct?
Members can ...
* gain an understanding of ethical and successful business operations
* acquire automatic entitlement to government sponsorship
* enjoy continued CIPS membership and access to resources
* bypass the need to comply with other voluntary or legal codes
- A. 1 and 3
- B. 1 and 2
- C. 1 and 4
- D. 2 and 3
Answer: A
Explanation:
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.
NEW QUESTION # 60
Which of the following is not a type of fraud that procurement professionals should be vigilant for?
- A. coersion
- B. identity theft
- C. kickback
- D. phishing
Answer: A
Explanation:
Coercion is not a type of fraud. The other three are.
NEW QUESTION # 61
As a procurement officer for a large organisation, a supplier approaches you on social media offering to take you out for dinner to discuss a recent open opportunity and mentions a financial reward if you help them win the business. You accept the invite. Was this the right thing to do?
- A. Yes, you are free to do what you like outside of business hours
- B. No, but you will go for the dinner and see what they offer, because it is up to you to decide if you should accept
- C. No, it is not appropriate to discuss open opportunities with one provider and not another
- D. Yes, you are keen to see what is on offer as you are only on minimum wage currently and need extra money
Answer: C
Explanation:
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.
NEW QUESTION # 62
A supplier operates in a monopolistic market where the threat of entry is low. The product that they offer is key in manufacturing certain types of submarines and there is no known substitute for the product at present.
What type of sourcing relationship is a buyer likely to have with this supplier?
- A. multiple sourced
- B. single sourced
- C. dual sourced
- D. sole sourced
Answer: D
Explanation:
This is sole sourcing as there is only one supplier in the marketplace.
Be careful not to confuse single sourcing and sole sourcing. Single sourcing is when a buyer chooses to work with only one supplier (usually to achieve economies of scale), sole sourcing, on the other hand, is when the buyer doesn't have a choice- they work with one supplier because there is only one supplier in the market.
Types of sourcing is a key concept for this exam.
NEW QUESTION # 63
GDP is an economic index that a procurement professional can use to measure economic data. What does GDP tell you?
- A. average changes in price over a year
- B. the monatary value of the goods manufactured in a financial period
- C. the value of commodities such as steel, oil and wheat at a point in time
- D. the value of public limited companies within a country
Answer: B
Explanation:
GDP = gross domestic product = "the monetary value of goods and services manufactured or sup-plied in a financial period". People use it to say whether a country's economy is strong or weak.
Stock markets look at the value of public limited companies within a country.
Commodity indices look at the value of commodities such as steel, oil and wheat at a point in time Average changes in price over a year can be measured by CPI or PPI
NEW QUESTION # 64
Which of the following financial ratios would indicate a supplier's potential exposure risk to a steeprise in inflation?
- A. acid test
- B. gearing ratio
- C. gross profit margin
- D. current ratio
Answer: B
Explanation:
The correct answer is 'gearing ratio'.
Gearing measures how much of a company's funding is based on long-term debt or loans- this would be affected by a steep rise in inflation. If a company has a mortgage on their offices or facto-ry and they need to remortgage and inflation has gone up a lot- they'll be paying a lot more on their mortgage. This will severely effect the gearing ratio as they'll have more outgoings than incoming.
Gross profit margin COULD be affected by inflation, for example if you've got hyper-inflation and the country goes into recession and people stop buying your product. However, this answer isn't al-ways right and depends on many factors- the industry, the product, the company etc, so for the purpose of CIPS should be discounted. There are many industries which are immune to inflation.
NEW QUESTION # 65
Which of the following are key areas of regulations that govern organisations in responsible procurement and supply?
- A. Digitisation, artificial intelligence and innovations
- B. Ethical practice, data protection and marketplace competition
- C. Company culture, product branding and staff uniforms
- D. Competitive pricing, unsecured business loans and threats of new entrants
Answer: B
Explanation:
Responsible procurement and supply are governed by several key regulatory areas to ensure ethical and fair practices. These include:
* Ethical Practice:Ensures that organisations conduct business in a manner that is ethical and free from corruption.
* Data Protection:Involves safeguarding personal and sensitive information, ensuring compliance with laws such as the General Data Protection Regulation (GDPR).
* Marketplace Competition:Ensures fair competition among businesses, preventing monopolies and promoting consumer choice.
These areas are critical in maintaining integrity, trust, and compliance within procurement activities.
Exact Extract from Study Guide:
"Key areas of regulation that organisations must follow include data protection, ethical practice, health, safety and environment, worker rights, marketplace competition, and product safety standards."
NEW QUESTION # 66
Which of the following would you use to work out a company's gearing ratio? Select TWO.
0current liabilities
- A. net profit
- B. gross sales
- C. shareholder equity
- D. long term debt
Answer: A,D
Explanation:
Gearing measures how much of an organisation's long-term funding is made up of long term debt and loans.
Therefore the correct answers are 'shareholder equity' and 'long term debt'.
There are many question about financial ratios that can come up on the exam. If you're unsure on them I suggest doing further reading outside of the study guide as this will help. I like this youtube video (I'm not associated with the makers of this video but think they're really good at explaining things to beginners) Gearing Ratio explained (youtube.com)
NEW QUESTION # 67
Which of the following can be undertaken by the buyer in relation to the governance of a supplier's ethical and sustainable behaviours?
* Review the insurance clauses in the contract
* Check that the supplier's internal policies are up to date
* Check the supplier's conflict of interest register for their contract
* Review the non-disclosure agreement for their contract
- A. 2 and 4 only
- B. 2 and 3 only
- C. 1 and 3 only
- D. 1 and 4 only
Answer: B
Explanation:
Regularly checking supplier policies and conflict of interest registers helps ensure that suppliers are upholding ethical standards, which supports responsible sourcing practices. This governance activity aligns with ethical guidelines to promote transparency and prevent conflicts that could affect the integrity of the supply chain.
NEW QUESTION # 68
Which award criteria can be applied when sourcing requirements from external suppliers?
- A. Delivery promises of goods
- B. Understanding of supplier operations
- C. Price and total life-cycle costs
- D. Plans and manpower numbers
Answer: C
Explanation:
Evaluating total life-cycle costs, including initial purchase price and long-term maintenance, aligns with ethical sourcing by promoting cost-effective and sustainable procurement. It ensures value for money and supports environmentally and financially responsible sourcing practices.
NEW QUESTION # 69
Which of the following items would you expect to find on a balance sheet? Select THREE
- A. current assets
- B. gross product sales
- C. current liabilities
- D. net product sales
- E. stockholders' equity
Answer: A,C,E
Explanation:
current assets, current liabilities and equity can be found on a balance sheet. Net and gross sales will be found on a profit and loss account.
NEW QUESTION # 70
Many organisations prefer a multi-sourcing approach because of the advantages it provides. Which of the following might be an advantage of multi-sourcing?
- A. It is the only approach that supports the open tendering process
- B. It is the only approach that enables the buyer to isolate the best supplier from among many
- C. It increases process flexibility and switching using a range of approved suppliers
- D. It helps the buyer to increase stock varieties to avoid stock-outs
Answer: C
Explanation:
Multi-sourcing allows organisations to diversify their supply base, providing flexibility, and reducing risk by having multiple suppliers. It is an effective strategy to prevent over-dependence on a single source and allows for competition among suppliers, promoting quality and ethical standards in the supply chain.
NEW QUESTION # 71
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