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CIPS L5M3 Exam - Topic 2 Question 62 Discussion

Actual exam question for CIPS's L5M3 exam
Question #: 62
Topic #: 2
[All L5M3 Questions]

Tutu Incorporated has a contract with a software company to provide their IT software. They want to ensure that the supplier pays compensation if there are any issues with service (e.g. the software doesn't work for a day). Which two items would Tutu Incorporated need to include in the contract?

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Suggested Answer: C, D

They should include service credits and a service level agreement. Service Credits allow the buyer to claim back if the service drops below an agreed standard. That standard needs to be clearly out-lined in an SLA. See p.31 for more details


by Walton at Mar 07, 2026, 02:20 PM

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Polly
15 days ago
Wait, unliquidated damages? Isn't that a bit risky?
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Cordell
20 days ago
I think service credit is also a must.
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Josefa
26 days ago
Definitely need a service level agreement!
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Lucia
1 month ago
Insurance could also be relevant in this situation.
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Cassandra
1 month ago
Wait, can they really enforce that? Seems tricky.
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Marva
1 month ago
Service credit is a must for compensation!
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Evelynn
2 months ago
Unliquidated damages? Not sure that's the right fit here.
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Nobuko
2 months ago
Definitely need a service level agreement!
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Lavina
2 months ago
I practiced a similar question, and I think both the service level agreement and service credit would cover Tutu's needs for compensation.
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Skye
2 months ago
I feel like unliquidated damages might not be the best choice here since they can be hard to quantify.
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Adelina
2 months ago
I'm not entirely sure, but I remember something about service credits being a way to compensate for downtime.
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Audry
2 months ago
I think a service level agreement is definitely important to outline the expected performance and remedies for failure.
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