Free CIPS L3M1 Exam Actual Questions

The questions for L3M1 were last updated On Apr 24, 2025

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Question No. 1

The idea / practice that some users / internal customers will spend organisational funds without in-volving procurement professionals when required to do so by organisational rules, is called:

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Correct Answer: D

One of the best ways to combat maverick buying is for procurement to be seen to be doing a good job, reducing the justification in colleagues' minds for going outside the system.

The other terms shown in the answers are simply made up to create the question.

This is your final question in this practice exam - good luck in the real exam!


Question No. 2

An arrangement between a buyer and a supplier in which they agree to apportion benefits (such a reduced costs, or increased outputs) arising from particularly sound contract performance may be called:

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Correct Answer: D

There is an expression 'painshare' which is an almost-ironic term referring to the opposite of the situ-ation described in the QUESTION NO : - when something has gone wrong, and the additional cost must be shared between the parties. The other two answers are a little bit facetious.

The correct answer is 'gainshare' when the parties share benefits, according to a pre-agreed ratio or formula.


Question No. 3

Which one of the following is a commercial document issued by a seller stating what the cost would be of supplying certain goods or services, normally in response to an enquiry by the buyer?

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Correct Answer: B

It's a supplier quotation.

Both the RFQ and the PQQ (sometimes known as 'SQ') are issued by the buying side, not the sell-ing side.

A commercial invoice doesn't tell you what the price 'would be' - it tells you what is owed after the event (usually - an exception being with prepayment in mind; or a 'proforma invoice' which is issued in some circumstances, especially internationally).


Question No. 4

The primary purpose of a public sector organisation is to:

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Correct Answer: D

The correct answer is to provide services. However, some other secondary factors may come into play. For example, some public sector organisations may be encouraged to boost national prestige eg airports, airlines; or they may be used as job creation schemes.


Question No. 5

Which one of the following is a document issued by a buyer to conduct an initial assessment of the suitability of a potential supplier for possible future use, either for a specific requirement or to add to a list of approved suppliers?

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Correct Answer: A

Pre-qualification QUESTION NO :naire is the correct answer.

A supplier quotation comes from the supplier side; both the RFQ and the ITT are intended to be more formally binding, including the price element, than what is described here.