CPPO EXAM WITH GUARANTEED ACCURATE ANSWERS |VERIFIED, Exams of Nursing

Download CPPO EXAM WITH GUARANTEED ACCURATE ANSWERS |VERIFIED and more Exams Nursing in PDF only on Docsity! CPPO EXAM WITH GUARANTEED ACCURATE ANSWERS |VERIFIED 7 Rights of Purchasing - ACCURATE ANSWERS✔✔ To obtain the right material in the right quantity for delivery at the right time to the right place from the right source (a responsive and responsible supplier) with the right service at the right price. Values - ACCURATE ANSWERS✔✔ Enduring beliefs or ideals shared by public procurement about what is good or desirable and what is not in our actions. Goals - ACCURATE ANSWERS✔✔ Long-term, tangible, attainable targets for an organization Policies - ACCURATE ANSWERS✔✔ Plans, courses of action, or governing principles which establishes the general parameters for the organization to follow in carrying out its responsibilities. Mission Statement - ACCURATE ANSWERS✔✔ States the purpose of its existence and its core values. It should be no more than three sentences and identifies the purpose of an organization, the services it provides, the customers it seeks to serve and the way it serves. Strategic Plan includes: - ACCURATE ANSWERS✔✔ Vision, mission, goals, objectives, strategies, performance measures and evaluation Vision - ACCURATE ANSWERS✔✔ Identifies where the organization wants to be in the future Mission - ACCURATE ANSWERS✔✔ Identifies why it exists, what it is and how it contributes to the local community. Goals - ACCURATE ANSWERS✔✔ Identifies what the organization is intending to accomplish and proposes the general end towards which an organization directs its efforts. Objectives - ACCURATE ANSWERS✔✔ Highly defined targets that require specific action with a shorter time frame. Strategies - ACCURATE ANSWERS✔✔ Identified methods to achieve specific goals and are used to carry out objectives. Long range plans Performance Measures - ACCURATE ANSWERS✔✔ The development and alignment of objectives and mechanisms for measuring the accomplishments of objectives to support the strategic goals of the organization. Something to evaluate against. Evaluation - ACCURATE ANSWERS✔✔ Monitoring the end results Objectives should be: - ACCURATE ANSWERS✔✔ SMART-Specific, measurable, assignable, realistic and time based. smaller entities, combines qualities so that each entity gets a good value and reduces admin costs of purchasing. Initial Steps to develop a Co-operative Purchasing Program - ACCURATE ANSWERS✔✔ Discuss the advantages, review agency policies and engage legal counsel to assess laws, develop a whitepaper, research what other authorities are doing. Cost Avoidance - ACCURATE ANSWERS✔✔ Actions taken to avoid having to pay some sort of cost. Also a dedicated effort on the part of the official to carefully analyze the agencies needs to prevent unnecessary charges. Cost Reduction - ACCURATE ANSWERS✔✔ Occurs when the current price to be paid by the buyer is lower than the previous price paid under similar procurement conditions generally as a result of a favorable competitive market. How to measure procurement performance - ACCURATE ANSWERS✔✔ Effectiveness, efficiency, projections and customer service Effectiveness - ACCURATE ANSWERS✔✔ How long it takes to process a request for procurement. Efficiency - ACCURATE ANSWERS✔✔ Defined as the ratio between inputs and outputs. Projections - ACCURATE ANSWERS✔✔ Derived from historical baselines of the key objectives and actual outcomes. According to Maslow's Hierarchy of Needs, which of the following is considered to be the ultimate human need? According to Maslow's Hierarchy of Needs, which of the following is considered to be the ultimate human need? - ACCURATE ANSWERS✔✔ Self Actualization The costs of maintaining an inventory of supplies (e.g. The costs of invested funds, insurance, storage, obsolescence, deterioration, equipment and labor) are known as: - ACCURATE ANSWERS✔✔ Carrying Costs One of the benefits of using Requests for Proposals is recognizing that the best solutions can come from field experts who deal on a daily basis with conflicts we are trying to solve. This benefit is known as: - ACCURATE ANSWERS✔✔ Value Engineering In preparing to write a specification or scope of work, we may want to consider one of two methods of gathering facts or details from potential vendors. We can invite several of them to come to our agency and make a presentation or we can cast a wider net with this technique. - ACCURATE ANSWERS✔✔ Request for Information The city has had a term contract in place for two years. The original term of the contract was for up to three years. Usage of the contract has declined to almost nothing. The city purchasing manager has decided to cancel the contract. Which of the following methods best addresses this action? - ACCURATE ANSWERS✔✔ Termination for convenience Laws governing public records, open meetings and freedom of information are known by this illuminating phrase. - ACCURATE ANSWERS✔✔ Sunshine law Requesting a contractor provide information as to why a contract should not be terminated for default is the purpose of a: - ACCURATE ANSWERS✔✔ Show cause notice Why is the Request for Proposal (RFP) process often perceived as problematic by an agency's leadership? - ACCURATE ANSWERS✔✔ The award decision is based on qualitative variables. Examples of audits are: - ACCURATE ANSWERS✔✔ Financial, compliance and management Examples of three types of audit reports are:* - ACCURATE ANSWERS✔✔ Intradepartmental, interdepartmental, higher level management Socioeconomic is defined as: - ACCURATE ANSWERS✔✔ Whats going on in a social environment that effects business such as "Green Procurement." Set-Asides is defined as: - ACCURATE ANSWERS✔✔ A previous term used by agencies to designate certain contracts for competition by disadvantaged business's. The current term used is "goals" Purchase history files contain the following types of files: - ACCURATE ANSWERS✔✔ Commodity files, agency files, vendor files, purchase order or contract files, inventory files. Purchasing Policy is defined as: - ACCURATE ANSWERS✔✔ A course of action adopted by the public agency that provides guidance relative to procurement actions. The purchasing policy of an agency reflects: -policies and practices used to acquire goods -the state's legal system -the goals and values of an agency Policies and Procedures are maintained at several levels: - ACCURATE ANSWERS✔✔ Policy Manual Procedures Manual Vendor Manual Policy manuals are defined as: - ACCURATE ANSWERS✔✔ Centrally written, controlled and used to guide behavior towards specific organizational objectives. Procedures manuals are defined as: - ACCURATE ANSWERS✔✔ manuals written at a finer level of detail that sets out processes, forms and steps. Used primarily by the end using department and procurement staff. Vendor Manuals are defined as: - ACCURATE ANSWERS✔✔ Manuals that provide formal and extensive information for vendors seeking to do business with the organization. Purchasing managers involved in the establishment of policy must: - ACCURATE ANSWERS✔✔ Be responsive and adaptive to their environment Act in the best interest of the government Be well-informed about the information associated with regulations Provide the support to perform functions within established policies and procedures What is the difference in an Operating and Capital Budgeting function? - ACCURATE ANSWERS✔✔ Operating budget is what it takes to run day to day operations and capital budgeting is high dollar permanent improvements. Budgeting is defined as: - ACCURATE ANSWERS✔✔ The allocation of scarce resources among competing demands and entails aspects of planning and fiduciary relationships to ensure that sufficient cash resources will be available to support the expenditure when the commitment is made. Budgeting Cycle** - ACCURATE ANSWERS✔✔ Planning Formalization Implementation Evaluation Adoption in procurement terms is defined as: - ACCURATE ANSWERS✔✔ The approval of the budget for a governing body. This includes legal adoption of expenditures and revenues which normally involve public hearings. Budget Implementation is defined as: - ACCURATE ANSWERS✔✔ The execution of the budget during the budgeting period. Involves collecting the revenues and expending the proceeds for the purposes intended. An allotment is defined as: - ACCURATE ANSWERS✔✔ Controlling the rate of spending authorized by an appropriation. Allocation is defined as: - ACCURATE ANSWERS✔✔ Controls specific use of the monies appropriated. ANSWERS✔✔ General-used to track revenues and expenditures that support all services not assigned to other funds. (Operating) Special revenue-provides services financed from various specifically designated revenue sources such as recreation fees used to support a specific activity. (parking garages) Capitol projects-used to acquire major assets with a useful life of more than one year, which may be financed by some sort of long term debt. Debt services-receive resources from other funds, taxes, grants or proceeds from long term debt and are used to pay the principal and interest on a debt. Proprietary funds are used when govenments engage in activities similar to private business such as: - ACCURATE ANSWERS✔✔ enterprise- control various utilities (water, water reclamation,electric) and other entities providing services financed through user charges. Internal service fund-used by governmental organizations that provide services to other units of the government by charging fees to cover their operating costs. Fiduciary Funds are defined as: - ACCURATE ANSWERS✔✔ Allowing the government to act as a custodian of assets that must be disbursed to individual, private and public entities. Example includes pension funds Capital Improvement Plan (CIP) is defined as: - ACCURATE ANSWERS✔✔ A multi-year plan that forecasts spending for all anticipated capital projects. Public Budgeting has three purposes which are often seen as being in dynamic tension with one another: - ACCURATE ANSWERS✔✔ Goal Attainment Financial Control Managerial accountability Rational budget decision model is defined as: - ACCURATE ANSWERS✔✔ The most effective budgetary approach for realizing goals that mirror public preferences and values. It promotes economic efficiency by allocating resources to those programs and services that generate greater net benefits and results in incremental benefits greater than the incremental costs. Inter-Sector Efficiency is defined as: - ACCURATE ANSWERS✔✔ Determines whether or not the cost of government activity yields more benefits to society than if it remained in the private sector. For example: Should daycare services be funded by the government? Inter-program Efficiency is defined as: - ACCURATE ANSWERS✔✔ Judges competing programs and allocates resources to the program that produces the greatest net benefits. For example: Should the police budget for youth activities be increased or should the recreation departments youth programs be increased? Intra-program Efficiency is defined as: - ACCURATE ANSWERS✔✔ Determines within each program if resources should be combined to maximize the net benefits from any given expenditure increment. For example, would it be more efficient for a specific service to be performed in-house or contracted out? Line item budgets are defined as: - ACCURATE ANSWERS✔✔ The oldest and still the predominant form of budgeting in the public sector. They are easy to understand and designed to maximize control and ensure financial accountability. Major weaknesses of line item budgets are: - ACCURATE ANSWERS✔✔ They focus on what is purchased rather than on the achievement of goals They provide no criteria for evaluating funding to determine what is to be gained or lost by increasing or decreasing expenditures. Efficient trade-offs among services are impossible to determine and must be made on the basis of subjective judgements about service effectiveness. They are prone to incremental increases in successive fiscal periods. They encourage a "spend it or lose it" attitude Performance Budget are defined as: - ACCURATE ANSWERS✔✔ Relate expenditures and revenues to workloads. They provide a mechanism to improve the management of service delivery, with cost Since activities in several decision units may contribute to the same output, authority over services is diffused. Results oriented budget is defined as: - ACCURATE ANSWERS✔✔ Budgeting that attempts to link resource allocation decisions to performance criteria that includes both output and outcome measures. Preparing an operational budget includes: - ACCURATE ANSWERS✔✔ The budget office of the agency prepares a policy overview, which includes statement of priorities and goals of the budget and details economic and policy assumptions. When determining service needs the following should be considered: - ACCURATE ANSWERS✔✔ Measuring demand (What is expected of my department?) Estimating staff needs (Do I have enough staff?) Measuring workload (Take a look at what needs to be done and can it be done with current staff and money) Estimating operating expenses (Do I have enough money?) Four types of audits are: - ACCURATE ANSWERS✔✔ Financial and compliance Economy and efficiency Program Performance Financial and compliance audits are: - ACCURATE ANSWERS✔✔ Performed by an independent accounting firm with the main purpose being to detect fraud. Economy and efficiency audits are: - ACCURATE ANSWERS✔✔ Management or operational audits. They examine administrative practices for economy and cost efficiency and attempt to identify the cause of any cost inefficiencies. Program audits: - ACCURATE ANSWERS✔✔ Monitor results to determine the extent to which a governmental unit has achieved program objectives. They evaluate the cost-effectiveness of the alternatives employes. Performance audits: - ACCURATE ANSWERS✔✔ Review all of the operations and encompass previous types of audits. Performance audits ensure that those entrusted with the management of public programs and services are held accountable. Smart cards are defined as: - ACCURATE ANSWERS✔✔ Similar to credit cards or pcards, they have an embedded computer chip that stores data for a variety of uses. The card can be pre-loaded with a certain amount of currency and serves as an "electronic wallet". Benchmarking is defined as: - ACCURATE ANSWERS✔✔ A process in which organizations measure various aspects of their processes in relation to best practices, usually within their own sector. Benchmarking commonly follows the following steps: - ACCURATE ANSWERS✔✔ Planning Analysis Integration Action Maturity In order to perform a benchmark evaluation, data must be collected and divided into several categories: - ACCURATE ANSWERS✔✔ Quantitative or objective data-Numbers, specifics Qualitative or subjective data- subject to interpretation Primary data-gathered for the first time "Raw Data" Secondary data-already been gathered and now analyze it Longitudinal data-gathered over a long period of time by repeated observation Cross-sectional data-data collected by observing many subjects at the same point in time. Process improvements are: - ACCURATE ANSWERS✔✔ A systematic approach to help any organization make significant changes in the way it does business. Non-value added - ACCURATE ANSWERS✔✔ Activities that generate zero or negative return on the investment of resources and can usually be eliminated without impairing the process. excessive inventory and production and labor time. The term has been adapted to mean that previously help MRO (maintenance, repair, operate) inventory items are outsourced to JIT vendors to provide next day service. Benchmarking is defined as: - ACCURATE ANSWERS✔✔ A process where a procurement organization identifies world class or best in class organizations and then compares its practices, policies and outcomes against those organizations. Effectiveness can be defined as: - ACCURATE ANSWERS✔✔ The degree of success in meeting the primary objectives of the central procurement office. Efficiency is defined as: - ACCURATE ANSWERS✔✔ Realtes to workload, operating costs, personnel, throughput times, amendments, quality assurance observations, late deliveries and client of vendor complaints related to volume of activity. A standard is fined as: - ACCURATE ANSWERS✔✔ The result of a particular standardization effort, approved by the recognized authority. It takes the form of a document containing a set of conditions to be fulfilled or an object for comparison. Ex. Brand X will be the standard for desktop computers. Standards can be either open or proprietary. Proprietary occurs when the customer is dependent on a vendor for products and services and cannot move to another vendor without substantial switching cost, real or perceived. Standardization is: - ACCURATE ANSWERS✔✔ An adoption of a single product or group of products to be used by the organization and focuses on agreement of designs, sizes, shapes, colors ,quality, material composition, chemical properties performance characteristics and assembly methods. A simplification program involves: - ACCURATE ANSWERS✔✔ Screening the agency's inventory in order to determine which items should be consolidated, updated or no longer maintained in inventory. Electronic signatures are: - ACCURATE ANSWERS✔✔ Digital signatures that permit sending authentic electronic documents. Some of the challenges procurement faces when they become involved in foreign trades are: - ACCURATE ANSWERS✔✔ Cultural differences, legal considerations, different specifications, trade agreements, lead time, communication/language differences, transportation, government practices, currency exchange rates, customs regulations and environmental stability. Joint-use ventures are defined as: - ACCURATE ANSWERS✔✔ Agreements between various government agencies that may involve the joint use of public property such as buildings and equipment. Performance incentive contract is defined as: - ACCURATE ANSWERS✔✔ Contracting with a vendor to identify opportunities for savings, reduced cost or increase revenues associated with the provision of a service and doing so without making up-front investments. Some conditions must be present for performance incentive contracting to be effective. They include: Potential for increased savings Motivated agency personnel Ability to establish the current cost of service Ability to specify the desired technical; and economic outcomes Determination that the agency is unwilling or unable to pursue the opportunity on its own. Management techniques and philosophies are: - ACCURATE ANSWERS✔✔ Traits approach (traits to differentiate leaders from non- leaders),situational leadership (how you manage in a certain situation), Path-goal Theory (relationship between the leader's style and the characteristics of followers within a work setting), Leader-member exchange theory or LMX (inner circle loyalty)Transformational leadership (inspiring followers to transcend their own self-interest for the good of the company. Servant leadership(enhance the growth of individuals in the org and increase teamwork and personal involvement.) Theorist FW Taylor focused on: - ACCURATE ANSWERS✔✔ entirely on productivity with little regard to job satisfaction. Theorist Chester Barnard focused on: - ACCURATE ANSWERS✔✔ General Electric employee outlined three basic managerial functions to principal is stuck for the acts of anyone he allows to appear to have authority Common Law - ACCURATE ANSWERS✔✔ Created by judicial decisions through the court system. Courts binding opinion interpreting the statutory law. Louisiana is unique in that it doesn't follow English law, it's a civil law state. Administrative Law - ACCURATE ANSWERS✔✔ Includes rules/regulations and orders/directives issued by administrative agencies under the quasi-legislative and quasi-judicial authority Civil Law - ACCURATE ANSWERS✔✔ Refers to the body of law affecting the relationships among individuals. Free On Board or Freight On Board (FOB) - ACCURATE ANSWERS✔✔ Without charge for delivery to and placing on board a carrier at a specified point; determines the point at which title for the shipment passes from vendor to purchaser Law of Agency - ACCURATE ANSWERS✔✔ Allows someone to act on the behalf of another (should be in writing). Falls under Common Law Benefits of Centralized Purchasing - ACCURATE ANSWERS✔✔ better price and service, efficient Nets consolidation Efforts not duplicated Facilitates management control Inventory has efficient control To get volume discount Set manager free to do core responsibilities Disadvantages of Centralized Purchasing - ACCURATE ANSWERS✔✔ can cause delays End user needs to follow up Not as sensitive to department needs Clients may bypass negotiated agreements Operational planning is not with purchasing Some unit prices could be lower Elements of a Contract - ACCURATE ANSWERS✔✔ A COOL CD Acceptance Consideration Offer Obligation Legality Competent parties Definiteness Parole Evidence Rule - ACCURATE ANSWERS✔✔ Verbal commitments can't be used to modify a written contract. Court won't admit evidence of prior understands that vary from contract terms. Decentralized Purchasing - ACCURATE ANSWERS✔✔ personnel from other areas can decide or negotiate with suppliers directly UCC-Uniform Commercial Code-Article 2 - ACCURATE ANSWERS✔✔ in 1952 to provide uniformity in state laws, primarily with the purchase and sale of goods 3 Sources of Law: - ACCURATE ANSWERS✔✔ Statutory/legislative- Constitutions-US, State & Local; Legislative acts of all levels-rules and regulations of all 3 Common- created by judicial decisions, fed & case law; sets precedence to follow. Binding interpretation of common law. Based on customs and traditions of English settlers. Administrative- Rules & regulations by administrative agencies to carry out regulatory duties Tort law: - ACCURATE ANSWERS✔✔ one law is bound to another by "Standard of care" Model Procurement Code - ACCURATE ANSWERS✔✔ Established in 1979 for state and local Govt by American Bar Association that is model legislation- not uniform code or law Privity of a contract - ACCURATE ANSWERS✔✔ only parties to a contract have the right to enforce its terms Delivery, inspection & acceptance - ACCURATE ANSWERS✔✔ sellers responsibility to have goods ready to be picked up. Delivery must occur within the time frame designated within the contract or if no date is specified, within a reasonable time. Once received, goods should be inspected because after a reasonable time has passed, the law deems the po has accepted the goods and loses right to return non-compliant , defective or excess goods. Express warranties - ACCURATE ANSWERS✔✔ not necessary for seller to use formal words such as warranty or guarantee or that he have specific intention to make the warranty but an affirmation merely the value of goods or sellers opinion does not make a warranty. Implied Warranty - ACCURATE ANSWERS✔✔ rests so clearly on a common factual situation that no particular language or action is necessary to evidence them and will arise in such a situation unless negated. Battle of the Forms - ACCURATE ANSWERS✔✔ If 2 parties enter into a contract and each uses their own form, the mismatched forms do not invalidate the contractual obligation of either party. If one party forms materially alters the agreement without consideration by the other party, it won't stand as the offer was never made and accepted. Force Majeure - ACCURATE ANSWERS✔✔ uncontrollable forces-act of God Severability Clause - ACCURATE ANSWERS✔✔ provides that the contract can remain in place in the event that any section is deemed to be unlawful. Economics of scale - ACCURATE ANSWERS✔✔ volume or quantity of a large purchase and savings realized by the entity because of size of purchase. Imperfect Competition - ACCURATE ANSWERS✔✔ the competitive area between pure or perfect competition and monopoly. Imperfect competition may occur in two forms. First is an oligopoly. Second may exist when seller produce many products. Neither the PO or seller are able to dominate in the market. Monopoly - ACCURATE ANSWERS✔✔ • A situation where there is one seller and many procurement officers of a product that has no close substitution and the seller has considerable control over price because of lack of competition. • The exclusive right to carry on a particular activity. Budget Cycle in Public Procurement - ACCURATE ANSWERS✔✔ • Planning • Formalization • Implementation • Evaluation Seller Pricing strategies - ACCURATE ANSWERS✔✔ • Cost based pricing-margin of profit is added to reasonable labor, material and overhead costs • Market-based pricing- when pricing is contingent on the customers current demand and willingness of the competitors to supply similar products • Value-based pricing-based on perceived or actual value that the po will receive. • Market-oriented pricing-where prices are defined according to the range of the quality of the product or service provided by the supplier. Evaluation Strategies - ACCURATE ANSWERS✔✔ • Price analysis • Cost analysis • Life Cycle Costing Types of specs - ACCURATE ANSWERS✔✔ • Design • Performance • Combination-design and performance • Brand name or approved equal • Qualified Products List QPL and samples Quality measures, which are the most difficult to quantify, include measures of: - ACCURATE ANSWERS✔✔ • Reliability: the ability to perform the service dependably and accurately • Responsiveness: The customer service aspect of the function • Assurance: the ability of procurement officers to instill confidence in their knowledge and abilities Effectiveness criteria include measures relating to the: - ACCURATE ANSWERS✔✔ • Timeliness in meeting deadlines and other scheduled procurement activities, such as obligating funds, issuing procurement documents and preparing contracts • Ability to solve problems relating to procurement procedures Suggesting criteria for evaluating efficiency include measures of the: - ACCURATE ANSWERS✔✔ • Cost per output, i.e. The number and dollar amount of contracts awarded per procurement specialist • Cost of the contracting organization as a percentage of the total award • Cost of the contracting operation as a percentage of the agency budget Structure Models for Procurement Organizations: - ACCURATE ANSWERS✔✔ • Centralized is mostly criticized for increasing red tape, prolonging the procurement period and being less responsive to the needs of purchasing services. • Decentralized- to increase the dollar limit approval levels and assign purchasing responsibilities to staff in the organizations functional depts. • Hybrid Structure is a combo of several models with both aspects of centralized and decentralized organizations. They incorporate elements of centralization while streamlining the process to speed up the procurement function. Risk factors for projects: - ACCURATE ANSWERS✔✔ • Proposal risk: how well does the supplier understand what the proposal requires? • Price risk: does the price accurately reflect what the procurement will cost? • Schedule risk: Will the required item be delivered on time? • Performance Risk: Will the supplier deliver the items with the expected quality? • Contractual Risk: Will the contract documents cover unforeseen issues and protect the public organization in case of problems? • Surety/Liability Risk: What are the potential liabilities that may be encountered by the public organization or supplier? Stages in the Solicitation Process: - ACCURATE ANSWERS✔✔ • Information gathering/Analysis/Supplier and product development: collecting information with respect to procurement needs and identifying supplier and product lists. • Identifying the needs and requirements definition: identifying specific functional needs for defining accurate requirements. • Specifications and standards: writing detailed technical description of the characteristics of the requested goods and services. • Review and authorization: assessing and endorsing prior to the actual procurement as a part of the oversight process. • Source document preparation and competitive sourcing: compiling formal paperwork for release to the supplier community, which may be very simple or very complex. • Review, evaluation and recommendation: deciding to procure goods and services and considering and assessing all submitted responses following predetermined guidelines. • Approval, award and contract formation: assessment and endorsement by the official, presenting a formal contract to the supplier and negotiating if necessary. • Acceptance, certification, payment and reporting: arriving at an agreement with the supplier in areas such as accepting terms; ensuring fulfillment of contractual requirements; initiating payment schedules, determining documentation and reporting requirements. Methods of Solicitation - ACCURATE ANSWERS✔✔ • Small Purchase/Pcard-granting authority to ind. Within pre-established thresholds. • Emergency Purchase-a purchase due to an unexpected condition. Competitive bidding waived. • Sole Source Purchase- only one vendor possessed a particular ability or capability to meet a need. • RFQ (Telephone and informal)-no sealed proposals. Small threshold and normally 3 quotes • IFB-competitive sealed bidding-preferred for acquiring goods some services and construction where award is made to lowest responsive and responsible bidder. • RFP-factors considered other than price such as qualifications, experience, value added services • Manage supplier performance Supplier Lists - ACCURATE ANSWERS✔✔ Creating supplier lists: NIGP has a commodity code listing that can be used. Two ways: first allows any supplier to register for the supplier list based on the product or service they offer. Second, is to pre-qualify supplier based on a number of criteria before including them on a list. Sourcing Strategies: - ACCURATE ANSWERS✔✔ • Competitive: IFB, Reverse Auction, RFP, ITN, RFQ and RFI. • Limited or Non-competitive: Small dollar, pcard, emergency and Sole Source Specifications - ACCURATE ANSWERS✔✔ An agency user has defined that a NEED exists to make an acquisition; the next step is to define "what" must be purchased. Specs must be reasonable and not overly restrictive. Stating requirement s that is not needed may result in increased costs and lead to a supply arrangement that doesn't offer a "best-Value: procurement. The use of quality specs achieves fairness, equity and transparency and provides for maximum competition resulting in reduced costs. Specs are intended to: - ACCURATE ANSWERS✔✔ • Describe and articulate minimum requirements • Identify performance, quality and operational characteristics • Enable suppliers and service providers to compare their products and services against stated requirements and offer bids on a comparable or equal basis • Enable the purchasing agent and organization to evaluate solicitation responses • Maximize competition Characteristics of a well-prepared spec will: - ACCURATE ANSWERS✔✔ • Accurately , clearly and concisely describe the product or service • Be relevant to the application or use • Avoid ambiguity • Describe the process and use • Allow for measurement, performance testing and acceptance or rejection upon delivery or installation • Provide for maximum acceptable tolerances enabling competition • Identify brand, make and model for comparisons as to an "approved equal" or exceed • Maximize competition at the manufacturing and distribution levels • Minimize extraneous costs • Allow for alternatives within a reasonable and acceptable tolerance level Types of specs: - ACCURATE ANSWERS✔✔ Design, Performance, Combination, brand name or equal, regulatory and testing agency, Restrictive (propriety products), industry standards, market grades, material and manufacturing method, tolerances, part drawing/spec, finishes, QPL Standardization - ACCURATE ANSWERS✔✔ Standardization is the methodology and process used in the manufacture of a product that establishes the physical and functional characteristics of that product. It becomes the norm or chosen preference over one brand, make or model over another and reflects a uniform or common appearance. Best value - ACCURATE ANSWERS✔✔ defined as a measure that is established through as process that determines the value of products and/or services acquired through a competitive process that results in supply arrangements at the most effective life-cycle cost, in the correct quantities, at the right quality and from the most responsive and responsible supplier or firm. A procurement method that emphasizes value over price. The best value might not be the lowest cost. This is usually obtained through an RFP. Law of agency - ACCURATE ANSWERS✔✔ A purchasing agent cannot exceed that authority which was passed on to them without prior acknowledgement, clearance and approval of the granting authority (unless certain thresholds are established.) The law of agency provides that a principal can appoint an agent to act on its behalf, and, when the agent acts, it is the principle, not the agent, who is bound by the agent. Delegated authority - ACCURATE ANSWERS✔✔ granted through legislation or by an org's governing body to specific individuals to exercise certain rights within specific terms of reference or guidelines. Spending Authority - ACCURATE ANSWERS✔✔ is the permission granted by an organization to an individual, which allows them to spend - Planning to ensure that sufficient cash resources are available to support commitments Roles in the Budget Cycle - ACCURATE ANSWERS✔✔ • Chief executive • Governing body • Budget units such as user departments • Clients served by the budget Four uses for a Budget - ACCURATE ANSWERS✔✔ • Policy document: articulates program priorities • Operations guide: Allocation of resources, performance objectives and activities • Financial plan: indicates sources of revenue and debt financing • Communications device: stimulate dialogue about important budget issues Audit: - ACCURATE ANSWERS✔✔ methodical examination and review of records and documents concluding with a detailed report of the findings. Types of Audits - ACCURATE ANSWERS✔✔ • Financial audits - determine if all financial transactions are recorded and shown properly • Compliance audits - determine compliance with policies and procedures • Management audits - determine degree of management efficiency and effectiveness • Performance audits - hybrid of above audits to improve effectiveness especially in decentralized buying program • Three types of final audit reports: - ACCURATE ANSWERS✔✔ - Intradepartmental reports - designed to inform the management concerning departmental matters - Interdepartmental reports - given to other departments on a "need-to- know" basis - Higher management reports - issued to senior management and other key personnel Strategic Planning - ACCURATE ANSWERS✔✔ • Alignment of an organization's vision and mission with tactical operations • Two parts to strategic planning process - Determination of purpose, vision, mission, goals and objectives - Expression of the how, where and when the organization intends to accomplish its goals Organizational Mission Statements - ACCURATE ANSWERS✔✔ • Describe purpose of the organization • Allow members of the organization to share a common view and philosophy • Strategic and tactical planning is done around the mission statement • Focus the organization on doing "the right thing" Strategic Plans - ACCURATE ANSWERS✔✔ • Usually 8 - 15 key results are desired • 1-2 strategic objectives for each key results area • Strategic objectives - describe conditions the organization wishes to achieve • Tactical Objectives - specific, usually short-term, aimed at supporting the strategic objective - Should be prioritized - with assigned responsibilities - Each should have specific target dates completion dates How does an Org Assess its Strengths and Weaknesses - ACCURATE ANSWERS✔✔ - Strengths - internal situations that help achieve the organization's objectives - Weaknesses - internal situations that impair an organization's ability to achieve objectives - Opportunities - internal or external - Threats - usually external challenges to the success of achieving objectives Strategic Procurement Planning (SP2) - ACCURATE ANSWERS✔✔ • Strategic planning in procurement • Chief Procurement Officer should initiate • Involves transformation of procurement's mission, goals and objectives into measurable activities The best way to begin putting That contract together is with: - ACCURATE ANSWERS✔✔ The end in mind When considering contract Termination, the contract Manager should first - ACCURATE ANSWERS✔✔ Start a File That Details the Conflict The need to establish a source Of supply for an extended Period suggests the use of: - ACCURATE ANSWERS✔✔ Term Contracts This element describes how Evaluators will observe, Test, evaluate and document Supplier performance - ACCURATE ANSWERS✔✔ Performance Assessment Plan Oral warning, written notice, Suspension, demotion, termination Are all steps in - ACCURATE ANSWERS✔✔ Progressive Discipline The review and evaluation of A supplier's real or anticipated Costs is known as: - ACCURATE ANSWERS✔✔ Cost Analysis A group of people with Different skill sets assembled From across an agency to deal With an issue is known as: - ACCURATE ANSWERS✔✔ A Cross- functional Team Loss of revenue, mistakes in The bidding process and Restrictive specifications Are some of the reasons for: - ACCURATE ANSWERS✔✔ Bid Protests Any test methods necessary to Verify compliance with the Requirements of a solicitation Should be identified in - ACCURATE ANSWERS✔✔ Specifications The structured process of Analyzing an agency's spending Patterns and making more effective Procurement decisions is known as: - ACCURATE ANSWERS✔✔ Strategic Sourcing A type of contract in which a Contractor is offered an additional Sum to complete a project Early is known as: - ACCURATE ANSWERS✔✔ Fixed Price Incentive Regular bidding, spot bids, Internet auctions, donations, Or transfers to other agencies Help us dispose of - ACCURATE ANSWERS✔✔ Surplus Property Providing an agency with A guaranteed maximum price After about 80% design Completion is a component of - ACCURATE ANSWERS✔✔ Construction Manager at Risk In the personnel arena, The expression "FTE" refers to - ACCURATE ANSWERS✔✔ Full Time Equivalent Position The analysis of an agency's The consideration of essential Functions, delegations of authority, Vital records management and Human capital is part o - ACCURATE ANSWERS✔✔ Continuity of Operations Planning Vendor Performance - ACCURATE ANSWERS✔✔ The Vendor's fulfillment of its contractual obligations with regard to quality, delivery, timeliness, as well as all other performance indicators and service levels. Procurement Officer - ACCURATE ANSWERS✔✔ A staff member who performs procurement functions and has specified authority to enter into Contracts on behalf of the entity. Proposal - ACCURATE ANSWERS✔✔ A Submission in response to an RFP. Bid - ACCURATE ANSWERS✔✔ An offer in response to an Invitation to Bid (ITB). Acquisition planning - ACCURATE ANSWERS✔✔ The cooperative process by which the using department and Procurement officer devise a comprehensive plan for fulfilling the end user's need in a timely manner and at competitive pricing. Planning includes the development of the overall strategy for managing the procurement and includes a detailed list of anticipated purchases over a period of time, usually one year. Contract Management - ACCURATE ANSWERS✔✔ The ongoing monitoring and management of the vendor's performance regarding the promised goods or services, as well as all other terms and conditions of a contract, such as price and discounts. It includes managing the relationship between the vendor, the Procurement Office, the Requisitioner and/or the end-user, feedback to the vendor regarding its performance, as well as dispute resolution, if necessary. Weighting - ACCURATE ANSWERS✔✔ The assignment of relative importance to each evaluation criterion so that a rating system can be used to assess whether each vendor's proposal meets or exceeds the minimum requirements of a solicitation and to objectively compare it with other vendors' proposals. Evaluation Criteria - ACCURATE ANSWERS✔✔ Factors or specific areas of consideration that are part of the requirement specifications. These factors are measurable components of the goods or services required and provide a basis for assessing each vendor's ability to perform or deliver the goods or services. Performance-based contracting - ACCURATE ANSWERS✔✔ A type of Contract whereby requirements are specified in terms of performance and output and generally include performance incentives and penalties. Performance Scope of Work - ACCURATE ANSWERS✔✔ The performance SOW conveys what the final product should accomplish, rather than how it should be built or what its design characteristics should be (ie., I want a car than will go zero to 100 mph per hour in 4.2 seconds) Functional Scope of Work - ACCURATE ANSWERS✔✔ The functional SOW conveys the end purpose or result, rather than specific procedures, etc., It is to be used in the performance of the work and may also include a statement of the minimum essential characteristics of the product (ie I want a car with 23 cup holders.) Design Scope of Work - ACCURATE ANSWERS✔✔ Conveys precisely what needs to be done (ie build exactly as shown on these drawings). What is a Fixed Price (FP, Lump Sum, Firm Fixed Price) contract? - ACCURATE ANSWERS✔✔ FP is the most common type of contract. BUYER has the least cost risk provided BUYER has a completely defined scope. SELLER is most concerned with the procurement SOW in this type of contract. What is a Fixed Price Incentive Fee (FPIF) contract? - ACCURATE ANSWERS✔✔ Profits (or financial incentives) can be adjusted based on SELLER meeting specified performance criteria such as getting work done faster, cheaper or better. Final price is calculated by a formula based on the relationship of final negotiated costs to the total target cost. What is a Fixed Price Economic Price Adjustment (FPEPA) contact? - ACCURATE ANSWERS✔✔ If there are questions about future economic conditions (future prices) for contracts that exist for a multi- SELLER has no incentive to control costs. Appropriate only for small projects. T&M contracts require a great deal of day-to-day oversight from the BUYER. What is the difference between profit and cost? - ACCURATE ANSWERS✔✔ PROFIT - amount of money the SELLER has left over after costs are paid. COST - how much an item costs the SELLER to create, develop or purchase. What is a ceiling price? - ACCURATE ANSWERS✔✔ This is the highest price the BUYER will pay. Note how the answers to calculations on the exam can change when a ceiling price is mentioned. What contract type and procurement SOW aligns with a Request for Proposal? - ACCURATE ANSWERS✔✔ PROCUREMENT DOCUMENT, CONTRACT TYPE, PROCUREMENT SOW - Request for Proposal (RFP), CR, Performance or Functional PROCUREMENT DOCUMENT, CONTRACT TYPE, PROCUREMENT SOW - Invitation for Bid (IFB), FP, Design PROCUREMENT DOCUMENT, CONTRACT TYPE, PROCUREMENT SOW - Request for Quotation (RFQ), T&M, Any What is a Letter of Intent? - ACCURATE ANSWERS✔✔ If a contract is not signed in time, the SELLER may ask the BUYER to provide a letter of intent. A letter of intent is NOT a contract, but simply a letter, without legal binding, that says the BUYER intends to hire the SELLER. It is intended to give the SELLER confidence that the contract will be signed soon and to make them comfortable with taking the risk of ordering the equipment or hiring the staff that will eventually be needed. What does Privity mean? - ACCURATE ANSWERS✔✔ Privity is a contractual relationship. QUESTION - Company A hires company B to do some work for them. Company B subcontracts to Company C. The proect manager for company A is at the job site and tells Company C to stop work. Generally does company C have to listen? Answer: No. Companies C and A have no contractual relationship. A needs to talk to B, who needs to talk to C. What is a Procurement Performance Review and why is it important to understand it? - ACCURATE ANSWERS✔✔ During the Administer Procurement process, the PM should analyze all available data to verify that the SELLER is performing as they should. This is called a procurement performance review. Often the SELLER is present to review the data and, most importantly, to talk about what the BUYER can do differently to help progress the work. The purpose of this review is to determine if changes are needed to improve the BUYER/SELLER relationship and the processes being used, in addition to determining how the work is progressing. Formal changes to the contract may be requested as a result of the meeting. The purchasing cycle includes all of the functions involved in the procurement of material and services from the time the need is recognized until the materials or services are completed or disposed of. The cycle can be described as three phases: - ACCURATE ANSWERS✔✔ Planning and scheduling Supplier Selection Contract Administration The sequence of steps taken in planning purchases must be coordinated with the appropriate user agency, with the two departments functioning as a team. These steps are: - ACCURATE ANSWERS✔✔ Developing clear, concise specifications or statement of work. Deciding on the best means of procurement and determining the correct type of contract Scheduling Supply and demand is defined as: - ACCURATE ANSWERS✔✔ The quantity of goods available at a given price, and the level of consumer needs for those goods at a given price. The balance of supply and demand fluctuates as external economic factors such as cost of material and the level of competition in the marketplace, influence the level of demand from consumers and the desire and ability of producers to supply the goods. Demand Analysis: - ACCURATE ANSWERS✔✔ Used to estimate annual requirements based on the previous year plus anticipated use for the upcoming year. Demand analysis utilized ABC system based on the Pareto principle that categories materials into classifications based on Hazardous Materials: - ACCURATE ANSWERS✔✔ Require special handling and storage requirements especially in an inventory warehouse system. Lead Time: - ACCURATE ANSWERS✔✔ The period of time from date of ordering to the date of delivery, including the time required for the vendor to manufacture or prepare the goods for shipment. Recovery: - ACCURATE ANSWERS✔✔ The ability of the purchasing department to obtain urgently required material and services from a supplier at a premium price. Stockless Purchasing: - ACCURATE ANSWERS✔✔ A system where the buying organization has no responsibility for inventory of goods being purchased. The inventory is owned by the contractor and may be located in the buyer's or contractors location. Fastenal vending machines Just in Time (JIT): - ACCURATE ANSWERS✔✔ reduces inventory and warehouse management problems. JIT is an ongoing effort to eliminate waste and reduce costs in the execution of the organizations strategic plan. Excess is defined as: - ACCURATE ANSWERS✔✔ Materials no longer needed by the owner but designated for transfer to another unit within the entity. Surplus is defined as: - ACCURATE ANSWERS✔✔ Materials no longer needed by the owner and designated for disposal outside the governmental agency. Shall: - ACCURATE ANSWERS✔✔ wherever a specification expresses a requirement binding on either party. Should: - ACCURATE ANSWERS✔✔ (and/or) may to express non- mandatory provisions Will: - ACCURATE ANSWERS✔✔ To express a declaration of purpose on the part of the purchaser. A good specification contains the following elements: - ACCURATE ANSWERS✔✔ Identifies a minimum requirement and allows for maximum competition. Commercial Standards are defined as: - ACCURATE ANSWERS✔✔ Detailed industry specifications of items that are standardized, such as nuts and bolts, electrical components, ect. Blanket Contracts: - ACCURATE ANSWERS✔✔ Also known as blanket orders, supply items or services on an "as needed" basis often on an over-the counter basis. Term Contracts: - ACCURATE ANSWERS✔✔ Establish a source of supply and pricing for specified items or services for a specified period of time. Scheduled Contracts: - ACCURATE ANSWERS✔✔ Consolidate organizational requirements by pre-establishing a bid opening date, such as on a monthly or quarterly basis. Systems Contracts: - ACCURATE ANSWERS✔✔ An extension of blanket orders and are used to reduce excessive use of small orders and or need to carry inventory. % off catalog prices Spot Purchase (Spot Buys) - ACCURATE ANSWERS✔✔ One time purchases. Used when requirements cannot be forecasted with accuracy. Contract Pricing Strategies are: - ACCURATE ANSWERS✔✔ a compensation arrangement and an important consideration that the procurement professional must determine for each procurement. Determines the level of risk assumed by the contractor and the entity. Hierarchy of guidelines for interpreting contracts: - ACCURATE ANSWERS✔✔ At the top is Cardinal rule. This focuses on the plain language of the contract and the meaning both parties gave to the text at the time of contract signing. Secondary rules include the whole instrument rule and the express language rule. The whole instrument rule gives priority to the meaning of the overall contract as opposed to a section or clause of the contract. The express language rule specifies that when there is a list of words Post-consumer - ACCURATE ANSWERS✔✔ materials are from commodities that have been used by consumers, recycled and reprocessed back into a consumer product Pre consumer - ACCURATE ANSWERS✔✔ materials left over in manufacturing processes and then reused in a consumer product Budget purposes - ACCURATE ANSWERS✔✔ goal attainment, financial control, managerial accountability Rational budget - ACCURATE ANSWERS✔✔ most effective budgetary approach for realizing goals that mirror public preferences and values. Allocating resources to programs and services that result in benefits greater than the costs. Line item budget - ACCURATE ANSWERS✔✔ maximize control and ensure financial accountability. Focus on what is purchased rather than goal achievements. Performance budget - ACCURATE ANSWERS✔✔ Focus' on the work being done in public agencies and seeks to enhance efficiency by looking at outputs and inputs of an activity. Program budget - ACCURATE ANSWERS✔✔ relates expenditures and revenues to public goals most elaborate budget form Zero based budget - ACCURATE ANSWERS✔✔ Start with a Zero Amount. Managers need to justify all amounts requested. Results oriented budget - ACCURATE ANSWERS✔✔ budgeting that attempts to link resource allocation decisions to performance criteria that include both outputs and outcomes measures Standardization committee - ACCURATE ANSWERS✔✔ used to create standards, requires input from, user agence, purchasing, legal (optional) suppliers/manufacturers(optional) Standardization committee is responsible for - ACCURATE ANSWERS✔✔ issuing and maintaining all standard specifications for supplies, services and construction; revising all standard specifications, establishing guidelines for drafting specs, establishing standards for marerials and products; evaluating products for the Qualified Products List Standardizatio program steps - ACCURATE ANSWERS✔✔ user department gives proocurement department written notice of intent to standardize. Standardization committee assessthe goods and services available that appear to met the user requirements. General industry standards are agreed upon. Procurement department advertises its intent to standardize the product. Supplier community responds with product information including specs and/or samples Committee reviews all submissions, agress on a standard and publishes the standard Team leader - ACCURATE ANSWERS✔✔ responsible for moving the team to accomplish its task. Ensure an environment that helps teams get their work done Team facilitator - ACCURATE ANSWERS✔✔ primarily responsible for ensuring that an effective process occurs by serving as adviser and consultant Usually not a team member. Team recorder - ACCURATE ANSWERS✔✔ person who is responsible for writing down the key points, ideas and decisions at meeting Time keeper - ACCURATE ANSWERS✔✔ monitor how long the team is taking to accomplish its task. Provide regular update of team progress, collaboate with team leader, facilitator and others to determine new time shcedules if the agenda has to be adjoined. Initiators - ACCURATE ANSWERS✔✔ offer new ideas and new solutions to the team Information seekers - ACCURATE ANSWERS✔✔ try to clarify suggestions and obtain pertinent information and facts for the team.