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L4M3 Exam Questions with Latest Update
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L4M3 Exam Questions with Latest Update
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L4M3 Exam Questions with LatestUpdate
Which of the following is a provision in a contract under which one party commits to
compensate the other for any harm or loss arising out of the contract? - Answer-
Indemnity
Which of the following are likely to feature within an output-specification? - Answer-
Product Functions & Performance Requirements
'The Contract' - Answer-the totality of the agreement between two parties as evidenced
by the contract documents.
'Whole Agreement' - Answer-it is useful to remember this concept when using a format
that involves a core document and a number of separate schedules
An Estimate - Answer-A suppliers best guess at what the price will be. It has no legal
standing
A tender and a quotation - Answer-essentially the same thing: both a firm offer to do
something for the quoted price or at the quoted rates, although the former will be more
detailed and comprehensive.
Quotation is normally used when - Answer-the only variable is price
The process for arriving at the quotation - Answer-often simple and informal, but
generally involve a buyer describing in precise terms what they wish to buy and a
supplier offering a price at which they are willing to supply it.
Quotations should only be used in any of the following situations - Answer--for low-
value, low-risk purchases
-where the specification and delivery terms are fixed
-where suppliers have been pre-qualified
-where a framework or dynamic purchasing system has locked down the contract terms
and price is the only variable
Tender is normally used when - Answer-there is potentially more than one variable
Tenders can be used where - Answer-everything other than price is already locked
down.
The process leading to a Tender will be - Answer-quite formal. It will require sealed bids
not to be opened before a specific deadline. The format of responses will be dictated by
,the purchaser. The contract terms will be specified in the invitation and required to be
accepted as aprt of the tender offer.
Tenders should be used in the following situations - Answer--For complex projects
-for high-value or high-risk purchases
-for projects where quality and price need to be assessed.
-where access to unknown suppliers is required and there is a need to either pre-qualify
them as part of a two-stage process, or to assess their stability as aprt of a single-stage
open tender process
Request for Quotation (RFQ) - Answer-A type of procurement document used to
request price quotations from prospective sellers of common or standard products or
services. Sometimes used in place of request for proposal and, in some application
areas, it may have a narrower or more specific meaning.
Framework Agreement - Answer-A formal agreement between two organisations that is
intended to become legally binding in the event that a contract is created
Invitation to Tender (ITT) - Answer-more formal sourcing exercises than RFQs, which
means more thought is given to the selction of suppliers and the working up of contract
documentation. Sometimes called requests for tender (RFTs)
Public (or state) sector - Answer-Service organisations run by the government and
usually funded by taxes
Utilities sector - Answer-normally includes energy supplies, water and sewage, and
telecoms networks.
Joint Contracts Tribunal - Answer-a body set up to include various stakeholder groups
from both constructing and client sides of the industry
Tender returns (or submissions) are - Answer-generally more detailed than quotations,
including vterm-24ariables such as mthof statements, timescales or ther quality aspects
of the delivery, as well as price.
Audit Trail - Answer-the written or electronic record of what was done, when and by
whom.
Bribery - Answer-the promise, offer or giving of financial advantage to someone in the
expectation that they will improperly perform their functions, or to reward them for
having done so; also accepting such a promise, offer or advantage (whether or not the
function is improperly performed)
Corruption - Answer-a wider term than bribery, includes any improper performance of
function in return for some kind of advantage which may or may not be financial, e.g,
,facilitation payments, nepotism (favouring family members) or career promotion. Both
the providing and receiving of the advantage are practice.
Collusion - Answer-where two or more potential suppliers (or the purchaser and one or
more suppliers) secretly co-operate to undermine the competitiveness of a tender
process.
Audit Trails are important because - Answer--they reduce bribery, corruption and
collusion by increasing the likelihood of being caught.
-they provide solid evidence in the event of such activity occuring.
-they improve accountability even when there is no criminal or fraudulant intent.
-they help trace errors.
-they provide solid evidence of the facts of a situation when disputes arise.
RFQs are useful because - Answer-they are quick and informal
RFQs carry risks because - Answer-they only look at price, not quality and they may not
be tied adequately to contract documents.
Transparency - Answer-operating in such a way that everyone can see the actions
performed
Waiver - Answer-a considered and deliberate decision not to apply normal rules
The waiver process should - Answer-include a requirement to state what has been
learned from the situation and how (if) that can be built into operational improvements.
Tender processes must be - Answer-transparent. If there is a reason for normal
processes to be waived, this must be fully documented and approved at a high level.
Specification - Answer-the document which sets out the detailed requirements for the
goods, services or worls that you are procuring
Any ambiguity, misunderstanding, lack of clarity or confusion about the specification will
result in - Answer--poor bids being received - either overpriced or underpriced
-claims for extensions of time or additional payments
-administration costs resulting from contract clarification orders
-the potential for goods or services being delivered that do not serve the desired
purpose, or being delivered in the wrong place, at the wrong time or in the wrong
quantities
-the potential for goods or services being delivered which do not meet the required
standards, which may be written in law, putting the purchaser, end users or the general
public at risk
Specifications - Describing exactly what you want in miniscule detail can - Answer-make
you miss out on opportunitites for change and innovation
, Two types of specifications - Answer-Performance and Conformance
Traits of performance specifications - Answer--focus on outputs
-sets out result to be acheived
-the 'what', not the 'how'
-gives supplier flexibility to present solutions that the buyer may not have considered
Traits of Conformance specifications - Answer--focus on inputs
-gives specific methods, processes and materials
-may identify specific manufacturers or components
-the 'how' as well as the 'what'
-ties supplier to set details
10 key things to think about when designing a specification - Answer--Purpose
-Type
-Perspective
-Relevance
-Scope
-Performance
-Improvement and Innovation
-Clarity
-Regulatory compliance and quality
-Service conditions
Designing a specification: Purpose - Answer-What are you trying to achieve?
-current needs
-future-proofing
-the make or buy question
Designing a specification: Type - Answer-Decide whether to use a conformance or
performance specification, taking the following into account:
-whether a specific technical interface or compatibility with other systems is required
-interoperability between suppliers products including any risk of todays solution locking
Designing a specification: Perspective - Answer-Decide what the difference stake
holders need
-identify the stakeholders
-consider what influence they have
-decide what their needs are
-remember to consider the perspective of the supplier
Designing a specification: Relevance - Answer-Include everything you need, and
nothing you do not.
-what are the minimum and maximum standards? How would they differ in cost, and
would extra cost be offset by greater benefit?
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