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| Vendor: | CIPS |
|---|---|
| Exam Code: | L5M2 |
| Exam Name: | Managing Supply Chain Risk |
| Exam Questions: | 120 |
| Last Updated: | February 27, 2026 |
| Related Certifications: | Level 5 Advanced Diploma in Procurement and Supply |
| Exam Tags: |
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Which of the following will you put into box 5?
The correct answers are as follows:

Cashflow issues can lead to serious financial problems and the company going bust. Therefore this risk must be treated.
Envy Manufacturing has several factories located in countries with poor reputations for human rights. It is concerned about potential risks of child labour being used within the supply chain. Envy Manufacturing has therefore decided to enlist the support of a third party auditing company to audit its factories. How should these audits be conducted? Select TWO
2 and 4 are correct. Audits should be unscheduled so that any issues can't be covered up in advance. Interviews with workers should also be conducted in private as this will allow them to speak their mind with confidence. Where interviews are conducted as a group there may be peer-pressure to say the correct thing. especially if there are managers around. see p.88 for information on Audits
Controlling a risk through the development of actions that can minimise the impact the organisation will suffer as a result of the risk event is known as what control?
This is the description of treat mentioned on p. 143. The 4 Ts is a popular exam topic
There are three main areas where third party suppliers are used in risk management. What are they?
3 4 and 5 are the correct answers. This is from p. 79 of the textbook - each of these three areas is then covered in detail throughout chapter 2.2.
Which of the following will you put into box 2?
The correct answers are as follows:

Cashflow issues can lead to serious financial problems and the company going bust. Therefore this risk must be treated.
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