CIPS L4M4 Ethical and Responsible Sourcing Online Training
CIPS L4M4 Online Training
The questions for L4M4 were last updated at Feb 05,2025.
- Exam Code: L4M4
- Exam Name: Ethical and Responsible Sourcing
- Certification Provider: CIPS
- Latest update: Feb 05,2025
Greg is doing some research on a potential supplier and is concerned that the supplier’s funding is based on long-term debts and loans. Working with this supplier therefore might bring additional risks to Greg’s business.
What should Greg do about his concerns?
- A . use the Return on Investment Ratio
- B . do an Acid Test
- C . work out the supplier’s EBITDA
- D . work out the supplier’s gearing ratio
Kiran is appraising some potential suppliers and has noticed that one of these suppliers has an extremely high gearing ratio.
What would this suggest?
- A . the supplier is extremely profitable
- B . the supplier has a lot of long-term debt
- C . the supplier has a high cost of sales
- D . the supplier has a strong return on investment
What would an EBITDA ratio show you?
- A . how profitable a business is
- B . how solvent a business is
- C . how much of a business’s funding is made up of long term debt
- D . how effectively a business uses its assets to generate sales
A company has a low gearing of 20%. This shows that the company relies on equity capital and should therefore have less difficulty coping during tough economic times. Is this statement TRUE?
- A . Yes- a low gearing ratio means the company’s finances are made up of equity rather than debt
- B . Yes- a low gearing ratio shows that the business is solvent and can deal with supply chain disruptions easily
- C . No- a low gearing suggests that the company is financed by long-term debt rather than equity
- D . No- a low gearing shows you that a company isn’t likely to be profitable
Which of the following is an example of intracompany trading? Select TWO
- A . a manufacturer in the UK buys raw copper from a supplier in Chile
- B . two companies owned by the same entity conduct business
- C . two companies join together to create a new product
- D . two departments within the same company collaborate on a project
- E . cleverness
During which stage of the procurement cycle would you remove suppliers that do not add value, or could pose a risk to the buying organisation?
- A . develop strategy
- B . supplier selection
- C . contract award
- D . asset management
For complex and high value tenders, which document is the most appropriate to send to those suppliers who have already been appraised and deemed suitable?
- A . PQQ
- B . ITT
- C . RFQ
- D . RFT
Robert is appraising suppliers and is keen to evaluate suppliers’ contribution to the community and the environment.
Which of the following should Robert look at?
- A . ESG Policy
- B . Anti-Slavery Policy
- C . ISO9001
- D . ISO27000
Which of the following would you use to determine the outcome of a competitive tender? Select TWO.
- A . location
- B . distribution
- C . reputation
- D . quality
- E . price
Pre-qualification of suppliers is used to determine if the suppliers meet the basic requirements of the buying organisation.
Which of the following is assessed at the pre-qualification stage?
- A . capacity, capability and pricing structure
- B . pricing structure, ethics and financial stability
- C . financial stability, capacity and capability
- D . capability, culture and pricing schedules
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