Cima passleader pdf P3 Study Guide by Jett q170 vce pdf

Page: 11 / 12

Exam Name:	Risk Management
Exam Code:	P3 Dumps
Vendor:	CIMA	Certification:	CIMA Strategic level
Questions:	339 Q&A's	Shared By:	jett

Question 44

Which of the following statements best explains why a corporate treasury department should be established as a cost centre rather than a profit centre?

Options:

The Treasury Department should not be encouraged to speculate.

The Treasurer should not have a great deal of responsibility.

There is no way for the Treasury Department to generate revenue.

The Treasurer has the ability to manipulate the Department's reported profit.

Discussion

Billy

It was like deja vu! I was confident going into the exam because I had already seen those questions before.

Vincent Aug 15, 2024

Definitely. And the best part is, I passed! I feel like all that hard work and preparation paid off. Cramkey is the best resource for all students!!!

Victoria

Hey, guess what? I passed the certification exam! I couldn't have done it without Cramkey Dumps.

Isabel Sep 21, 2024

Same here! I was so surprised when I saw that almost all the questions on the exam were exactly what I found in their study materials.

Nadia

Why these dumps are important? Can I pass my exam without these dumps?

Julian Oct 22, 2024

The questions in the Cramkey dumps are explained in detail and there are also study notes and reference materials provided. This made it easier for me to understand the concepts and retain the information better.

Nylah

I've been looking for good study material for my upcoming certification exam. Need help.

Dolly Oct 3, 2024

Then you should definitely give Cramkey Dumps a try. They have a huge database of questions and answers, making it easy to study and prepare for the exam. And the best part is, you can be sure the information is accurate and relevant.

Question 45

The management of U is reviewing internal controls throughout the company. It has noted the following:-

1. In the trade receivables section, journal adjustments are made by the clerks, without any reference to their supervisor. Journal adjustments may relate to sales returns, discounts allowed, or transfers between accounts.

2. In the purchasing department, the purchasing manager selects and approves all suppliers, as they are the only person with sufficient experience to do so. They use a very limited number of suppliers because they can rely on these suppliers to provide goods of the quality required at a competitive price. They do not keep any documents in relation to negotiations with other potential suppliers or other quotes obtained.

In relation to the above, which of the following statements are valid?

Options:

The fact that the purchasing manager uses a very small number of suppliers is, in itself, a sign of poor internal controls.

It is acceptable for clerks in the trade receivables section to make journal adjustments without authorisation provided the amounts involved are not material to U's financial statements.

It is acceptable for clerks in the trade receivable section to make journal adjustments without authorisation, provided they have no access to cash receipts.

The fact that the purchasing manager does not keep documentation relating to negotiations with suppliers, or potential suppliers, is evidence that they are involved in fraudulent activity.

Clerks making journal adjustments without reference to their supervisor is evidence of inadequate separation of duties.

The way the role of purchasing manager is carried out in U increases the chance that the company will fall victim to fraudulent activity.

Discussion

Question 46

M is a multinational IT company with headquarters in Asia and with operations in all continents.

It is now trying to expand its operations in Europe. This is seen as a major challenge as the European market is very well developed with established players in fierce competition against each other.

As well as developing and producing its own products, it sources products across Asia, America and Europe as part of infrastructure deals which have to include as much of its own equipment as possible. In doing this, transfer prices can be set in YEN, USD, EURO, GBP. Transfer prices are revised every month in line with production times as most goods are made on short order times with sales cycles running at 3-4 months.

The longer sales cycle against committed transfer pricing presents problems as customers expect quotes to be valid for 90 days whereas M's suppliers reserve the right to revise pricing at the end of every month with quotes only valid for 8 days in the following month.

How should M deal with this problem?

Options:

Use a centralised treasury function to set up unilateral netting so that all trades can be balanced off against each other before any money is transferred.

Offer a small discount for any customers who pay in M's home currency.

Do nothing, everyone is in the same situation.

Incentivise sales persons to be more accurate when forecasting prices.

Discussion

Question 47

Which THREE of the following form part of the role of Internal Audit?

Options:

Working with operational management teams to help identify risks to the business.

Working with operational management teams to devise new controls to help minimise risk to the business.

Providing training to operational management on the identification of risk

Implementing internal controls which address the key business risks identified by the risk management team

Carrying out special investigations of risk.