Exam (elaborations)
CIPS Level 4 Module 1 2024 Questions With All Correct Answers.
- Course
- Institution
CIPS Level 4 Module 1 2024 Questions With All Correct Answers.
[Show more]
Seller
Follow
Content preview
CIPS Level 4 Module 1 2024 QuestionsWith All Correct Answers
The Purchasing process - ANSWERS:1. Define Specification.
2. Select Supplier
3. Contract Agreement
4. Ordering
5. Expediting
6. Evaluation Follow up
Definition of Procurement & Supply - ANSWERS:recognition of the fact that the
purchasing function has a role in not just "buying inputs" but in "securing supply"
Direct Costs - ANSWERS:These are costs which can be identified directly with the
production of a good or service; e.g. raw materials.
Usually strategic or leverae suppliers
Indirect Costs - ANSWERS:These are costs which cannot be matched against each
product because they need to be paid whether or not the production of good or services
takes place; e.g. rent on the premises.
Kraljic Matrix - ANSWERS:A tool for portfolio analysis: a four-box matrix that reflects the
segmentation of spend based on an assessment of the value of the spend relative to
the market risk to acquire
1. Leverage Suppliers
2. Strategic Suppliers
3. Routine Suppliers
4. Bottleneck Suppliers
CAPEX is - ANSWERS:1. Capital expenditures are for major purchases that will be
used in the future.
2. The life of these purchases extends beyond the current accounting period in which
they were purchased.
3. Because these costs can only be recovered over time through depreciation,
companies ordinarily budget for 4. CAPEX purchases separately from preparing an
operational budget.
OPEX - ANSWERS:Operating expenses are the costs for a company to run its business
operations on a daily basis.
CAPEX - ANSWERS:1. Useful beyond its curent year
2. Lump sum up front
3. 3-10 year accounting lifespan for depreciaiton
4. Listed as preprty or equipment
,5. Tax deducted as asset depreciated
Name the 13 stages of the procurement cycle - ANSWERS:1. Understand the need.
2. Market Commodity options.
3. Develop Stratgey/ Plan.
4. Pre-procurement / market test.
5. Develop required documentation.
6. Supplier Selection.
7. Issue invitation to tender.
8. Bid / tender evaluation.
9. Contract Award.
10. Warehouse logistics & receipt.
11. Contract performance review and continuous improvement.
12. Supplier relationships / contract management.
13. Asset management / end of life.
Scope of Procurement - ANSWERS:1. Contributor of Added Value
2. Manages cost of procured materials & services on behalf of an organisation
3. Helps manage inventory
4. Works alongside logistics partner function
5. Helps mange quality in procurement
6. Manages delivery performance
7. Manages & controls waste in the supply chain
Porters Value Chain - ANSWERS:Primary - Inbound Logistics, Operations, Outbound
Logistics, Marketing & sales, Services
Support Activities - Firm Infrastructure, HR Management, Technology, Procurement
Action points for CAPEX purchasing - ANSWERS:1. Documentation or guidline and
standard procedure
2. Cross-functional team for appraisal & evaluation
3. Appropriate project evaluation methology
4. Process automation (E-platform)
5. TCO / Life cycle costing
6. Regular review for better control & monitoring
5 rights of procurement - ANSWERS:Right Quality
Right Quantity
Right Price
Right Place
Right Time
Right Quality - ANSWERS:goods which are of satisfactory quality and fit for their
intended purpose e.g. ensuring an accurate specification of the requirement and its
quality standards.
,Right Quantity - ANSWERS:sufficient to meet demand and maintain service levels while
minimising stock holding e.g. by ensuring that there is accurate demand forecasting and
efficient inventory management.
Right Place - ANSWERS:goods delivered to the appropriate delivery point, packaged
and transported so as to secure their safe arrival in good condition e.g. by including
transport instructions including packaging requirements as part of purchase orders.
Right Time - ANSWERS:delivery of goods at the right time to meet demand, i.e. not too
late but not so early as to incur unnecessary inventory costs e.g. by ensuring accurate
demand management, placing orders in time for suppliers to provide timely delivery and
ensuring that suppliers are aware of delivery requirements.
Right Price - ANSWERS:securing all of the above at a reasonable, fair, competitive and
affordable price. Ideally, minimising procurement costs in order to maximise profit e.g.
by carrying out price and supplier cost analysis and/or by carrying out competitive
tendering and negotiation. The 'right' price is one that represents good value for money.
Life Cycle cost (LLC) - ANSWERS:The total cost throughout its life including planning,
design, acquisition and support costs and any other costs directly attributable to owning
or using the asset".
Total Cost of Ownership (TCO) - ANSWERS:1. TCA
2. Tooling
3. Insurance
4. Operation
5 Maintenance
6 Training
7. Storage
8. Disposal
TCO Acquisition costs - ANSWERS:Acquisition/Physical Hardware costs include the
cost of equipment or property before taxes, but after commissions, discounts,
purchasing incentives, and closing costs.
Sometimes this will include one-time peripheral equipment or upgrades necessary to
installation or utilisation of the asset.
TCO Operating costs - ANSWERS:Operating costs include subscriptions or services
needed to put the item into business use. This includes utility costs, direct operator
labour, and initial training costs.
TCO Personnel costs - ANSWERS:Personnel overhead may include administrative
staffing, support personnel to the equipment, facility housing the equipment and
operators.
, This may include ongoing training and troubleshooting labour for maintenance
purposes.
Opening Considerations 1 of 2 - ANSWERS:1. Procurement involcves something which
may be tangible (goods) or intangible (services
2. The procurement process begins by indentifying a need and is completed once the
goods or services that meet the need are delivered.
3 Procurement is increasingle becoming a strategic function of the business and
involves a high level of skill
4. Procurement takes place in most of all organisations; everything that needs sourcing
and buying for an organisation involves procurement. Therefore, the costs of an
organisation can be linked to procurement
Supply Chain - ANSWERS:a network of individuals, organisations, technology, activities
and resources that work together to make sure goods or services flow.
If one part of the chain fails, every organisation further along the chain can also fail.
Suppl chain managment aims to - ANSWERS:1. Reduce costs
2. Improve Value
3. Reduce risk
Should give the supplying organisation a competitive advantage by adding value
throughout the process, and achieving it in the most effective, efficient and ethical way.
SCM - ANSWERS:Supply chain management and procurement are not the same thing,
although they are inter-related
Without procurement, there would be no supply chain
1. Procurement as part of supply chain management
2. Procurement is about procuring products and servicing as a response to a need,
while a supply chain is the infrastructure involved in physically getting the products or
services needed.
Procurement includes the following
3. Preparing specifications
4. Monitoring quality
5. Sourcing
6. Buying
7. Stock control
8. Disposal of waste
What is logistics - ANSWERS:The process of planning, implementing and controlling
procedures for the efficient transporting and storage of goods, including services and
related information, from the point of origin to the point of consumption, for the purpose
of conforming to customer requirements.
Logistics can be - ANSWERS:1. Inbound and outbound
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Denyss. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
75632 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now