CIPS L4M2 Exam - Topic 4 Question 62 Discussion

Actual exam question for CIPS's L4M2 exam

Question #: 62
Topic #: 4

[All L4M2 Questions]

Thani Ltd is a fast growing logistics company with a fleet of 20 tractors. To meet Net Zero objec-tive, the company needs to electrify its fleet. Angelica is assigned to investigate the market price of electrifying services. After the investigation, she realises that the current market price is very expensive and unsustainable for her company. She decides to break down the costs before negotiating with the suppliers. Which internal stakeholders may help Angelica estimate the breakdown of costs? Select TWO that apply.

ASales and Marketing department

BEngineering department

CFinance department

DCommercial agency

ESuppliers

Show Suggested Answer

Suggested Answer: B, C

Despite of its importance, cost analysis is often a daunting task for procurement professionals. In order to analyse supplier's costs effectively, procurement may need the input from other depart-ments. Normally, technical (or engineering) department may help them to identify the direct costs of the product/service (how much material is required to make the product, or how many people are needed to perform the job, etc), while finance (or accounting) department may have ideas on the overheads of the supplier.

In this scenario, engineering department may provide insights on the components needed and the tasks to perform. Similarly, finance may know how much supplier pays for the overheads.

On the other hand, while commercial agency and suppliers are external stakeholders, Sales and marketing is unlikely to provide valuable information in this case.

LO 2, AC 2.3

by Janessa at Aug 02, 2025, 02:26 PM

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Gary

2 months ago

Suppliers might have insights, but they’re not internal stakeholders!

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Jonell

2 months ago

Sounds like a tough situation, but can they really negotiate better prices?

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Adelle

2 months ago

I think the Engineering department is crucial too.

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Aide

3 months ago

Wait, why would Sales and Marketing be involved in cost breakdowns?

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Refugia

3 months ago

Definitely the Finance department, they know the costs!

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Gladis

3 months ago

I agree with Jane, the Engineering department seems essential, but I also wonder if the Finance department is the only one we need to consider. What about the Commercial agency?

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Leanna

4 months ago

I’m a bit confused about whether the Sales and Marketing department would be relevant here. They usually focus on revenue, not costs, right?

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Ma

4 months ago

I remember a similar question where we had to identify stakeholders for a project. I feel like the Engineering department could provide insights on the technical costs involved.

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Charlena

4 months ago

I think the Finance department would definitely be one of the key stakeholders to help with cost breakdowns, but I'm not sure about the second one.

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Alida

4 months ago

This question is pretty straightforward. The Finance department and Engineering department are the obvious choices to help Angelica break down the costs. They'll have the most relevant expertise and information to assist her.

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Eulah

4 months ago

Okay, let's see. Angelica needs to estimate the costs of electrifying the fleet, so she'll want to work with the Finance team to get the financial details. And the Engineering department would have the technical knowledge on the equipment and installation costs. Those seem like the two best options here.

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Maurine

4 months ago

Hmm, I'm a bit unsure about this one. I think the Finance department and Engineering department would be the most helpful, but I'm not 100% confident. I'll need to think it through carefully.

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Yaeko

5 months ago

This seems like a straightforward question. I'd focus on identifying the key stakeholders who can provide the cost breakdown information Angelica needs.

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Jackie

5 months ago

I agree with Lorrie. The Finance department is crucial for estimating costs.

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Dona

5 months ago

Hmm, I'm not sure the Commercial agency would be that helpful. Seems like an unnecessary middleman in this case. Keep it in-house with Finance and Engineering.

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Aileen

5 months ago

I agree, the Finance department is crucial, but the Engineering team would also be invaluable in understanding the technical requirements and potential cost savings.

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