CIMA CIMAPRO19-P03-1 Exam Practice Test Instant Access

Question 1

UJK manufactures garden machinery. The company is dependent upon another manufacturer for the motors that power its products.

One of the factors that is being considered in a stress test requested by UJK's Board is the possibility that the motor manufacturer increases its selling prices by 10% The motor accounts for a significant proportion of the overall manufacturing cost of UJK's products

Which of the following are correct?

AThe motor manufacturer should be contacted and told that a substantial increase in selling prices would have a drastic impact on UJK

BThe possibility of an increase in selling prices due to increased costs should be noted in the stress test report

CUJK should estimate the impact on demand of increasing selling prices to pass on the increased cost of the motors.

DThe impact of absorbing the increased cost of motors on UJK's profits should be calculated.

EUJK should identify an alternative vendor of suitable motors as part of its stress test

Answer : C, D

Question 2

You are the management accountant for YY a food manufacturing company with an annual sales revenue of $6 million

You discover that the production manager's records are inconsistent Raw materials purchased do not agree with the total recorded for transfers to production plus wastage There is an average shortfall of 2% of purchases

You have investigated and discovered that there are often errors made during manufacturing that results in food that is safe to eat but. because of visual flaws, cannot be sold

The production manager is supposed to scrap all such damaged products and write all such losses off as waste You have discovered however that he has been giving the damaged food to a charity that assists homeless people No records are made of such gifts in order to conceal the losses due to manufacturing errors

Which of the following actions should you take? Select ALL that apply

AInstigate disciplinary action this is both theft and poor management

BDo nothing; this is a good cause and the amount is insignificant

CInstigate a review of the production process to potentially reduce the amount of wastage.

DInstigate a confidential but documented review with the production manager and tell him to stop

EInstigate a process whereby edible but unsellable items can be given to the charity officially

Answer : A, C, E

Question 3

Which of the following is the major advantage of Cloud storage for an enterprise?

AIt provides unlimited free use for the enterprise

BThe enterprise has complete control over it

Cin-house staff are not required to maintain the infrastructure

DSharing storage space with others

Answer : C

Question 4

ZZ is a data security company that is responsible for cyber security m a large shopping mall 21 uses Network Configuration Management (NCM) to assist it in meeting the various needs of the mall's user community.

Which THREE of the following are advantages provided by NCM?

ANCM allows ZZ to prevent data corruption for different user groups in the mall

BNCM allows ZZ to provide different service levels for different user groups in the mall

CNCM allows ZZ to segregate traffic for different user groups in the mall

DNCM allows ZZ to prevent scanners being used on the public WiFi for different user groups in the mall

ENCM allows ZZ to restrict traffic for different user groups in the mall

FNCM allows ZZ to stop malware from being spread for different user groups in the mall

Answer : B, C, D

Question 5

TLY sell building materials such as bricks sacks of concrete and paving slabs to builders Materials are kept in a large yard Customer orders are fulfilled by a team of 30 employees who use forklift trucks to move sold items to the loading bay, from where they are loaded onto lornes for dispatch to the customer The sales office prepares dispatch notes, which are used by the yard employees to identify the items that have been ordered

Which TWO of the following controls would be cost-effective ways to prevent the theft of inventory by TLY's staff?

AHave a security guard check outgoing lorry loads of materials against a dispatch note

BConduct random searches of yard staff when they are leaving at the ends of their shifts

CInstall closed circuit television cameras covering the whole yard and with screens constantly monitored by security staff

DForbid staff from parking their cars in the yard

EHave a separate buying department, whose staff do not have access to the yard to place orders for replacement inventory

Answer : A, C

Question 6

Which TWO of the following are NOT methods used for risk identification?

ACarrying out interviews on key members of staff

BDesigning a process to deal with complaints

CEmploying external advisors with specialist knowledge

DAccounting for waste in a manufacturing process

EBrainstorming ideas with colleagues from different disciplines within the business

Answer : B, E

Question 7

JKL makes large export sales to customers in country X, whose currency fluctuates significantly against JKL's home currency JKL also makes large purchases from suppliers in countrrOC All of these transactions are in country X's currency

JKL's treasurer does not actively hedge currency risks because there is a natural hedge in place due to the company making both sales and purchases in the same currency

JKL's board has instructed the treasurer to put active hedging measures in place because the risk report would otherwise have to disclose the fact that JKL has a currency risk which is not actively hedged

Which of the following statements are correct? Select ALL that apply.

ARisk reports can change behaviour

BRisk reporting is a bad thing

CThe board may be concerned it will be criticised if it does not hedge

DThe board does not want to be blamed for ignoring a risk.

ERisk reporting drives the whole risk management process

Answer : A, C, D

CIMAPRO19-P03-1 P3 Risk Management Exam Practice Test