Valid P3 Exam Q&A PDF P3 Dump is Ready (Updated 268 Questions)
Exam Questions and Answers for P3 Study Guide
NEW QUESTION 157
The safety guard on a piece of equipment was broken. The factory manager suspended an operator who refused to operate the equipment until it was repaired. The factory manager paid another operator a bonus for operating the damaged equipment until the safety guard could be repaired.
What does this incident say about the control environment within that factory?
- A. Employees will perceive that management does not care about health and safety risks.
- B. This factory's safety record is likely to be poor.
- C. Management is not particularly concerned with managing risks.
- D. Management has a proportionate and considered attitude towards risk.
- E. Employees are motivated to maintain productivity.
Answer: A,B,C
NEW QUESTION 158
B is a quoted construction company. Its Board consists of qualified and experienced engineers Which TWO of the following statements are correct?
- A. Creating a nominations committee from B's Board will resolve any issues
- B. There is a greater risk of B's Board making strategic errors.
- C. The greater consistency arising from the composition of B's Board will be beneficial
- D. B's Board cannot be blamed for recruiting like-minded individuals
- E. The quality of Board decisions may decrease.
Answer: A,C
NEW QUESTION 159
Identify, from the list provided, which category of business risk most accurately describes the events detailed below.
Answer:
Explanation:
NEW QUESTION 160
Company C wishes to recruit an employee who will have responsibility for, among other things, the receipt and handling of cash. Which THREE of the following would be most likely to provide useful information about the candidate from the point of view of the Internal Auditor?
- A. The candidate's membership of a professional body.
- B. Confirmation that the candidate does not have a criminal record.
- C. The candidate's personal referees.
- D. The candidate's academic qualifications.
- E. References from previous employers of the candidate.
Answer: A,B,E
NEW QUESTION 161
A project has been evaluated on the basis that it will cost $22 million and will have a net present value of $4.3 million The project has commenced and $5 million of the $22 million has been invested. A problem has been discovered that will cost an additional $4.5 million to rectify. The $4.5 million will be payable immediately.
What is the NPV of continuing with this project?
- A. -$0.2million
- B. -$5million
- C. $4.8million
- D. $1million
Answer: C
NEW QUESTION 162
The acronym VPN stands for.
- A. Virtual Private Network
- B. Virtual Personal Network
- C. Verified Private Network
- D. Very Personal Network
Answer: A
NEW QUESTION 163
The long-term prospects for interest rates in the UK and the USA are 2% and 6% per annum respectively.
The GBP/USD spot rate is currently GBP/USD1.71.
Using interest rate parity theory, what GBP/USD spot rate would you expect to see in six months' time?
- A. GBP/USD = 1.78
- B. GBP/USD = 1.67
- C. GBP/USD = 1.65
- D. GBP/USD = 1.74
Answer: D
NEW QUESTION 164
The government health service in country H employs well over 100,000 staff in various locations throughout the country. Traditionally, local management has had high levels of autonomy in relation to personnel issues and there are several different human resources (HR) managers located across various regions.
The government has decided to introduce a completely new HR/payroll information system to have just one database containing all relevant information about every staff member on the payroll (start date, job title, salary and all other details) and to use this information to begin streamlining recruitment and HR policies.
The government has outsourced the system's development to a reputable company.
Which of the following are disadvantages associated with this IT project?
- A. The amount of data storage space required to run the system may not be available.
- B. There is a risk that significant anomalies in the current system will be highlighted.
- C. Any initial problems in running the system could have serious repercussions as it could lead to, for example, staff not being paid, payroll tax not being properly collected, and similar difficulties.
- D. There is a risk that the system will not capture all of the existing terms and conditions of staff, thus leading to industrial relations problems later.
- E. The government is very heavily dependent on the contractor to whom this assignment is outsourced and if they do not to perform as required this could have serious consequences.
- F. The system could make it more difficult to employ specialist medical staff on terms and conditions which are different from the normal terms and conditions available.
Answer: C,D,E
NEW QUESTION 165
The list below has duties performed by risk managers and internal auditors. Show who would carry out the duties assuming the company has both risk managers and internal auditors.
Answer:
Explanation:
NEW QUESTION 166
A patient has been prescribed a new medicine by their physician. The medicine is accompanied by a leaflet describing potential adverse effects associated with taking it. Most of these potentially adverse effects are trivial, but the leaflet states that three patients in every 10,000 who take the medicine suffer a severe reaction requiring urgent medical attention.
Which of the following statements is true?
- A. Statistical probabilities mean very little in themselves when dealing with decisions that could have serious consequences, such as whether to take this medicine.
- B. The patient should not be concerned because only those few patients who are susceptible to this reaction are at risk.
- C. Statistically, the medicine is safe.
- D. The patient should ignore the risk because there is only a 0.03% risk of a severe adverse reaction.
Answer: A
NEW QUESTION 167
Match the descriptions shown in the boxes below with the method of quantifying risk exposure it best describes.
Answer:
Explanation:
NEW QUESTION 168
Why is it potentially useful for an organisation to maintain a risk register?
- A. To provide the risk manager with a role.
- B. To ensure that recognised risks are adequately managed.
- C. To ensure that there are no undiscovered risks.
- D. To eliminate all recognised risks.
Answer: B
NEW QUESTION 169
Match the descriptions shown in the boxes below with the method of quantifying risk exposure it best describes.
Answer:
Explanation:
NEW QUESTION 170
ERT is choosing between two maintenance policies for its vehicles. The outcomes of these policies are difficult to predict and so ERT has run a simu-lation of both.
Policy 1 has an expected annual cost of $400,000 per year, with a standard deviation of $80,000.
Policy 2 has an expected value of $350,000, with a standard deviation of $150,000.
Which of the following statements are correct?
- A. Policy 1 will always be the more expensive in any given period.
- B. Policy 2 is clearly the better policy.
- C. Policy 2 is the more likely to cost more than $500,000 in any given year.
- D. Policy 2 has the greater potential upside risk.
- E. Policy 2 is the more risky.
Answer: C,D,E
NEW QUESTION 171
BCD has set up a number of functions within its security operations centre (SOC) One of these is a Hunt team.
Which of the following is the primary function of a Hunt team?
- A. To look for weaknesses in BCD's cyber security system.
- B. To look for weaknesses in other peoples' systems
- C. To look for signs that BCD's system has been breached
- D. To look for solutions in response to threats.
Answer: C
NEW QUESTION 172
YUI owns 18 factories, which are spread around the country. Each factory employs 500-700 production staff and has its own administrative and accounts departments.
It has recently been discovered that the manager in charge of YUI's Hightown factory has been overstating his personal expenses claims for the past five years. The total amount stolen in this manner has been estimated at
$10,000.
Why would it have been relatively difficult to have prevented this fraud?
- A. Senior members of management can often override controls.
- B. Managers are generally highly intelligent and are generally capable of designing ways to defeat control systems.
- C. It is impossible for anybody to check expenses claims submitted by a senior manager.
- D. Internal controls cannot address fraud, only error.
Answer: A
NEW QUESTION 173
In relation to the use of the adjusted present value (APV) technique, which of the following statements are correct?
- A. To apply APV the actual amounts of debt and equity in the capital structure must be known.
- B. The weighted average cost of capital - net present value technique and the APV technique will, if applied correctly, give the same answer.
- C. The interest tax shield on the project's debt must be known, or at least estimated.
- D. To apply APV, the proportions of debt and equity in the capital structure must be known.
Answer: B,C
NEW QUESTION 174
The board of OKN is considering an investment opportunity that will require the company to borrow a large amount in month 10 of the current financial year and to invest it immediately in property, plant and equipment.
This investment has a positive net present value that justifies the risk, but the directors are reluctant to invest in the project.
Why might the directors be reluctant?
- A. The year's profit will be depressed by the amount of the investment.
- B. The return on capital employed for the year will be reduced if the investment is made.
- C. Future profits will be depressed.
- D. The return on capital employed for the year will be increased if the investment is made.
Answer: B
NEW QUESTION 175
BCD has set up a number of functions within its security operations centre (SOC) One of these is a Hunt team.
Which of the following is the primary function of a Hunt team?
- A. To look for weaknesses in other peoples' systems
- B. To look for signs that BCD's system has been breached
- C. To look for weaknesses in BCD's cyber security system.
- D. To look for solutions in response to threats.
Answer: C
NEW QUESTION 176
You are a junior accountant in a local accountancy firm with many clients in various businesses.
Your immediate manager has asked you to collect certain personal details about clients' staff from the firm's records. You suspect that his intentions are malicious.
You asked your manager to explain why he required these details and he told you it is none of your business.
What should you do? Select TWO responses.
- A. You should seek to have a confidential discussion with the manager's superior and express your concerns.
- B. You should keep a log of all the facts that the manager has requested, including the dates on which those requests were made.
- C. You should raise the matter with the firm's external auditors.
- D. You should stop being impertinent and obtain the details as instructed.
- E. You should try to find out what the manager wishes to use the details for.
Answer: A,B
NEW QUESTION 177
H is a senior production manager for P Ltd which is about to make a strategic decision on setting up a new production line requiring $3 million of new specialist equipment.
H's daughter is friends with and goes to school with the daughter of T, the sales manager in KK Ltd. KK Ltd is a potential supplier of the specialist equipment that P Ltd requires.
T owns a holiday home. H's daughter regularly accompanies T's daughter on family vacations at this holiday home, all at T's expense.
H is the only person working for P Ltd who is qualified to select the specialist equipment. KK Ltd will definitely bid for the sale.
What should H do?
- A. H should declare an interest and withdraw from the assessment process.
- B. H should exclude KK Ltd from the bidding process.
- C. H should declare an interest, giving details of his daughter's friendship with T's daughter, but should participate fully in the assessment process.
- D. H should permit KK Ltd to bid, but should insist that T should not be involved.
Answer: C
NEW QUESTION 178
W plc is a large international supermarket chain. It has many thousands of suppliers and many thousands of others competing for "shelf space" in its supermarkets.
Which of the following would be appropriate provisions for W plc to include in its Ethical Code in relation to its suppliers?
- A. W plc shall not use its buying power unscrupulously.
- B. W plc shall keep confidential all information received from suppliers and potential suppliers.
- C. W plc shall endeavour to adhere to the terms of its contracts with its suppliers at all times.
- D. W plc shall continuously remind suppliers that it always has several alternative suppliers to choose from.
- E. W plc shall endeavour to take as high a percentage of each supplier's output as possible.
- F. W plc shall insist on an exclusivity agreement with each supplier so that identical products are not available from other outlets.
Answer: A,B,C
NEW QUESTION 179
E purchases parts for one of the machines it manufactures from Country X Place the risk classification next to the risk it relates to:
Answer:
Explanation:
NEW QUESTION 180
Systems Development Lifecycle (SDLC) is used to manage risk within the development of new computer systems.
Which THREE of the following are appropriate controls to manage risk within the SDLC Process?
- A. When doing the analysis for the new system particular care should be taken over the data specification, transformation and manipulation, ensuring that expected outputs are defined and that such output meets the needs and expectations of the business users.
- B. When developing the new system, the developers must follow defined programming standards and carry out component test to specified test harness outputs.
- C. When the implementation of the new system is taking place, parallel running must be undertaken to ensure the output for the new system exactly matches that from the old system.
- D. When planning the new system, a clear business case must be approved specifying functionality, data transformation, expected costs and benefits.
- E. When designing the new system, controls must be put in place to ensure that all the functionalities of the old system are replicated.
- F. The Post Completion Review should take place immediately after the implementation while all the facts are still fresh in everyone's minds.
Answer: A,B,D
NEW QUESTION 181
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