Which of the following statements is true about model form of contract?
Answer(s): B
Model forms of contract are published by some industry or professional organisations such as FIDIC, ITC, CIPS,... These forms are often carefully prepared by legal professionals, with correct legal terminology. The standard clauses within these forms are based on fair and balanced risk/reward allocation between the contracting parties. The model contract forms also include standard clauses to be selected or deleted on an as required basis.Despite being standardised to be used in any jurisdiction, legal advice may be required if the users decide to make variations to the forms.The correct answer should be "Model contract form's standard clauses often contain correct legal terminology without recourse to third party experts."
CIPS study guide page 144-147 LO 3, AC 3.1
Blakenall District Hospital (BDH) is a large hospital that is a major part of the government's health service. Purchasing staff are in the habit of placing many long-term contracts with suppliers and sub- contractors. Whilst these contracts are usually carried out successfully, prices are often paid that are well over budget. The purchasing manager is concerned to find that, in some cases, members of staff are forcing suppliers to accept fixed price contracts. The policy has caused several problems such as some suppliers refusing to deal with BDH and a few going out of business mid-way through performing a contract with BDH. This is due to fluctuating market prices of materials. The procurement manager suggests supplier to adopt variable pricing arrangement with price index. Is this a right course of action?
Answer(s): C
Procurement staff in the Hospital is forcing suppliers into fixed price contract. If the costs generally rise, supplier may operate at a loss. This situation can disrupt the relationship, that is the reason why some suppliers refusing to deal with BDH and a few going out of business mid-way. Alternative methods could be variable pricing arrangement. This method would reimburse the fluctuation of market price. It will also benefit buyer if the market price drops. This type of arrangement should be applied to long-term contracts (i.e. 18 months or more).
CIPS study guide page 179-184 LO 3, AC 3.3
A purchase order can become a contract between supplier and purchaser if it is...?
A purchase order is a document sent from a buyer to a seller, with a request to order a product. The purchase order often has its number, description and quantity of the goods, unit prices and total price, name of issuer, time of delivery, standard terms and conditions, etc. It is effectively an offer to supplier. The purchase order will become a formal contract if supplier accepted it by written notice or by performance (such as deliver the goods to the buyer's premise).
CIPS study guide page 33 LO 1, AC 1.2
Which of the following are among five 'pillars' of information assurance?1. Recovery plan2. Availability3. Non-repudiation4. Governance
Answer(s): A
Information Assurance (IA)Information Assurance (IA) is the practice of managing information-related risks and the steps involved to protect information systems such as computer and network systems. The IA transformation is a partnership that stretches across the Department of Defense (DoD), Office of National Intelligence, Committee on National Security Systems, National Institute of Science and Technology (NIST), and the Office of Management and Budget. The US Government's definition of information assurance is:"measures that protect and defend information and information systems by ensuring their availability, integrity, authentication, confidentiality, and non-repudiation. These measures include providing for restoration of information systems by incorporating protection, detection, and reaction capabilities."Information Assurance (IA) is essentially protecting information systems, and is often associated with the following five pillars:- Integrity- Availability- Authentication- Confidentiality- NonrepudiationThe following pillars can be applied in a variety of ways, depending on the sensitivity of the information, or information systems within your organization. Currently, these five pillars are used at the heart of the US Governments ability to conduct safe and secure operations in a global environment.1. IntegrityIntegrity involves assurance that all information systems are protected and not tampered with. IA aims to maintain integrity through means such as anti-virus software on all computer system, and ensuring all staff with access to know how to appropriately use their systems to minimize malware, or viruses entering information systems.2. AvailabilityAvailability simply means those who need access to information, are allowed to access it. Information should be available to only those who are aware of the risks associated with information systems.3. AuthenticationAuthentication involves ensuring those who have access to information, are who they say they are. Ways of improving authentication involve methods such as two-factor authentication, strong passwords, bio-metrics and other devices. Authentication may also be used to not only identify users, but also other devices.4. ConfidentialityIA involves the confidentiality of information, meaning only those with authorization may view certain data. This step is closely mirrored by the six data processing principles of the General Data Protection Regulation (GDPR), where by personal data must be processed in a secure manner "using appropriate technical and organizational measures" ("integrity and confidentiality").5. NonrepudiationThe final pillar simply means someone with access to your organizations information system cannot deny having completed an action within the system, as there should be methods in place to prove that they did make said action.
- What is Information Assurance (IA)?- CIPS study guide page 99-100 LO 2, AC 2.1
Rochdale Ltd is looking for a new IT system to automate some of its operations. In designing the specification, procurement manager supposes that it should be done solely by the IT department who have deep expertise on this matter. Is procurement manager's opinion appropriate?
Procurement professionals have a role in challenging specifications. Technical experts can get things wrong and asking naive questions can be useful in bringing these to light. The challenging may include:- Does the organisation really need these features/functions?- With this specification, are there many available suppliers in the market?- How many does the organisation really need?etc
CIPS study guide page 9-10 LO 1, AC 1.1
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