JHU has recently completed an eight year project.

Vendor: CIMA
Product: P3
Update on: Jul 29, 2025
Questions: 339

CIMA P3 Question Answer

JHU has recently completed an eight year project. The project was evaluated at a discount rate of 10% and was accepted because the net present value was $18 million.

In year 3 of the project there was a significant unexpected repair arising because of the implementation stage of the project was rushed and some checks on equipment were skipped to save time. The cost of this was $8 million.

In year 8 of the project the costs of dismantling the project were $11 million more than anticipated because of unexpected changes to the law concerning disposal of industrial scrap.

How should these findings be reflected in the post completion audit?

Poor project management cost the entity $6 million, to the nearest million.

Poor project management cost the entity $11 million, to the nearest million.

Poor project management cost the entity $5 million, to the nearest million.

Poor project management cost the entity $16 million, to the nearest million.