CPPO CPPO Public Procurement Governance and Policy 1 — Questions and Answers
Question 1: Which federal law establishes uniform procurement standards for state and local governments receiving federal financial assistance?
- The Buy American Act
- 2 CFR Part 200 (Uniform Guidance) (Correct answer)
- The Competition in Contracting Act
- The Federal Acquisition Streamlining Act
Correct answer: 2 CFR Part 200 (Uniform Guidance)
2 CFR Part 200 sets procurement standards—competition, conflict of interest, documentation—that must be followed when spending federal grant funds.
Question 2: What is the primary governance purpose of a public procurement policy?
- To maximize vendor profits
- To provide a consistent, transparent framework that ensures public funds are spent lawfully, fairly, and efficiently (Correct answer)
- To reduce the number of solicitations issued annually
- To establish departmental staffing ratios
Correct answer: To provide a consistent, transparent framework that ensures public funds are spent lawfully, fairly, and efficiently
Procurement policy creates a rules-based framework that protects the public interest through transparency, competition, and accountability.
Question 3: In US public procurement, the concept of 'full and open competition' requires:
- All vendors in the state to submit bids
- Solicitations structured so all responsible sources are permitted to compete unless a specific exception applies (Correct answer)
- Contracts awarded exclusively to small businesses
- Bids accepted only from vendors on a pre-approved list
Correct answer: Solicitations structured so all responsible sources are permitted to compete unless a specific exception applies
Full and open competition means any qualified vendor may respond to a solicitation unless a statutory exception justifies restricting competition.
Question 4: A procurement appeals process serves which governance function?
- Allowing vendors to renegotiate prices after award
- Providing an administrative remedy for vendors who believe procurement laws or procedures were violated (Correct answer)
- Accelerating contract execution timelines
- Reducing the agency's legal liability exposure
Correct answer: Providing an administrative remedy for vendors who believe procurement laws or procedures were violated
Bid protests and appeals give aggrieved vendors a due-process mechanism to challenge perceived irregularities in the procurement process.
Question 5: Why are procurement thresholds established in public agency policies?
- To limit competition to large suppliers
- To calibrate oversight and procedural requirements proportionally to the risk and value of each acquisition (Correct answer)
- To eliminate the need for written contracts
- To set maximum allowable prices for all goods
Correct answer: To calibrate oversight and procedural requirements proportionally to the risk and value of each acquisition
Thresholds (micro-purchase, simplified acquisition, formal competitive) scale oversight requirements to match the complexity and financial risk of each purchase.
Question 6: The principle of 'separation of duties' in public procurement governance is designed to:
- Speed up vendor payment processing
- Prevent fraud and errors by ensuring no single individual controls all steps of a procurement transaction (Correct answer)
- Assign procurement authority to department heads only
- Allow emergency purchases without approval
Correct answer: Prevent fraud and errors by ensuring no single individual controls all steps of a procurement transaction
Separating requisition, approval, receiving, and payment functions creates internal controls that reduce fraud and error risk.
