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CIMAPRA19-P03-1 Exam - Topic 1 Question 44 Discussion

M built a large factory last year and it has just been completed. The initial outflows on this project have a present value of $400 million and the entire project has a net present value of $30 million.The initial phase of the project caused problems and there was an overspend of $35 million as there was unstable soil. The foundations had to be underpinned with large steel bars to ensure the building would be safe. There was no other suitable site for the project.Theconstruction could not be abandoned as the site would have hadvery little commercial value.The Internal Audit department has been asked to carry out a post completion audit. What issues should it concentrate on?
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project. and C) The audit should consider what lessons could be learned for future projects. and E) The audit should consider whether it should have built the factory without underpinning and sold it on quickly.
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
D) The audit should find out who was to blame for the project being over budget.

CIMAPRA19-P03-1 Exam - Topic 1 Question 44 Discussion

Actual exam question for CIMA's CIMAPRA19-P03-1 exam
Question #: 44
Topic #: 1
[All CIMAPRA19-P03-1 Questions]

M built a large factory last year and it has just been completed. The initial outflows on this project have a present value of $400 million and the entire project has a net present value of $30 million.

The initial phase of the project caused problems and there was an overspend of $35 million as there was unstable soil. The foundations had to be underpinned with large steel bars to ensure the building would be safe. There was no other suitable site for the project.

Theconstruction could not be abandoned as the site would have hadvery little commercial value.

The Internal Audit department has been asked to carry out a post completion audit. What issues should it concentrate on?

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Suggested Answer: B, C, E

by Lang at May 01, 2024, 08:11 AM

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Kara
8 months ago
Selling it quickly could've been a risky move, though.
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Carissa
8 months ago
Blame game won't help, focus on lessons learned instead!
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Deeanna
8 months ago
Surprised they didn't catch the soil problem earlier.
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Kelvin
8 months ago
I agree, proper procedures are key for future projects!
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Ramonita
9 months ago
Definitely need to check the initial survey report for that soil issue.
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Lashaun
9 months ago
I wonder if finding out who was to blame for the overspend is really the best approach. It seems like it could lead to finger-pointing rather than constructive feedback.
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Tiffiny
9 months ago
I feel like focusing on lessons learned for future projects is essential too. We talked about how audits can improve future planning and execution.
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Alaine
9 months ago
I'm not entirely sure, but I think ensuring proper procedures were followed at all stages is also important. It might help identify where things went wrong.
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Rebbecca
9 months ago
I remember we discussed the importance of reviewing the initial survey report in class, especially if it mentioned any issues like unstable soil. That could be crucial for the audit.
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Princess
9 months ago
This is a good one. I'd start by looking at the initial site survey, as that seems like a potential red flag. Then I'd dive into the project documentation to make sure everything was done by the book. And of course, the lessons learned piece is super important - we don't want this to happen again.
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Krystina
9 months ago
Ooh, this is a tough one. I'm a bit confused about whether the audit should try to find someone to blame for the overspend. That doesn't seem like the right approach to me - I'd focus more on understanding what happened and how to improve things going forward.
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Dana
9 months ago
Hmm, this is a tricky one. The overspend due to the unstable soil is a key issue, so I'd want to dig into that and see if it could have been anticipated. And looking at lessons learned for future projects is important too.
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Roy
9 months ago
This seems like a straightforward question about a post-completion audit. I'd focus on reviewing the initial site survey to see if the unstable soil was mentioned, and ensuring proper procedures were followed throughout the project.
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Penney
10 months ago
Okay, I think I've got a handle on this. The key things to focus on are reviewing the documentation, understanding the root causes of the issues, and identifying ways to apply those lessons to future projects. Shouldn't get too caught up in trying to assign blame.
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Blondell
10 months ago
This seems like a straightforward question. I think the AMPscript solution would be the best approach to automatically add the tracking parameters to the links.
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Anthony
10 months ago
I definitely recall the structure of A and its relation to inflation adjustments. Seems familiar!
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Diego
1 year ago
Blame? I've got my money on the 'unstable soil' being the real culprit here. It's always the quiet ones that cause the most trouble.
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Shanice
1 year ago
E) The audit should consider whether it should have built the factory without underpinning and sold it on quickly.
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Carolynn
1 year ago
C) The audit should consider what lessons could be learned for future projects.
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Kerrie
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Whitney
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Jesse
1 year ago
Sell it without underpinning? Yeah, that'll really work out well. I'd love to be the one who buys that factory!
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Corrina
1 year ago
C) The audit should consider what lessons could be learned for future projects.
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Hyman
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Lonny
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Cherrie
1 year ago
Finding someone to blame? Good luck with that. I'd rather focus on how to avoid such issues in the future.
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Ilda
1 year ago
C) The audit should consider what lessons could be learned for future projects.
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Rene
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Teri
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Donte
1 year ago
Learning lessons for future projects is crucial. This kind of experience is valuable, even if it was a bit messy.
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Edna
1 year ago
C) The audit should consider what lessons could be learned for future projects.
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Wilbert
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Kandis
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Maurine
1 year ago
Focusing on documentation and proper procedures is the way to go. That'll help identify any gaps or mistakes that were made during the project.
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Lisha
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Gladys
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Essie
1 year ago
The audit should definitely look at the initial survey report to see if the unstable soil was mentioned. If the survey missed it, that's a big issue that needs to be addressed.
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Jina
1 year ago
E) The audit should consider whether it should have built the factory without underpinning and sold it on quickly.
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Estrella
1 year ago
C) The audit should consider what lessons could be learned for future projects.
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Tennie
1 year ago
B) The audit should look at documentation to ensure proper procedures were followed at all stages of the project.
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Freeman
1 year ago
A) The audit should consider the initial survey report when the land was purchased to see if the survey mentioned the unstable soil.
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Makeda
1 year ago
But shouldn't the audit also look into who was responsible for the overspend?
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Nakisha
1 year ago
I agree, we need to learn from this experience to avoid similar issues in the future.
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Jani
1 year ago
I think the audit should focus on lessons for future projects.
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