CCM Vendor & Contractor Management 3

Question 1

Which document protects a community association from financial losses if a contractor abandons a project midway?

Accepted Answer

Performance bond

Answer

Certificate of Insurance

Answer

W-9 form

Answer

Indemnification agreement

Question 2

A community manager notices a vendor consistently arrives late and skips certain contracted tasks. What is the correct first step?

Accepted Answer

Document the deficiencies in writing and issue a formal notice to the vendor per contract terms

Answer

Immediately terminate the contract without notice

Answer

Personally apologize to residents and ignore the issue

Answer

Ask a board member to call the vendor informally

Question 3

What is the risk of allowing a vendor to begin work before a signed contract is in place?

Accepted Answer

The association may have limited legal recourse if disputes arise over scope, price, or liability

Answer

The vendor may charge a lower rate without the contract

Answer

There is no significant risk if the vendor is well known

Answer

The association loses tax exemption status

Question 4

When a vendor contract includes an automatic renewal clause, what should the community manager do well before the renewal date?

Accepted Answer

Review performance, compare market pricing, and provide written notice of non-renewal if rebidding is desired

Answer

Allow the automatic renewal to proceed without review to save time

Answer

Ask the board to vote to cancel all existing contracts annually

Answer

Contact a new vendor immediately without notifying the existing one

Question 5

Which of the following best describes the purpose of an indemnification clause in a vendor contract?

Accepted Answer

It requires the vendor to defend and hold the association harmless from claims arising out of the vendor's negligence

Answer

It sets the payment schedule for the vendor

Answer

It defines the start and end date of the contract

Answer

It grants the vendor access to community facilities

Question 6

A community association wants to hire a new elevator maintenance company. The state requires elevator contractors to hold a specific license. What must the manager verify before awarding the contract?

Accepted Answer

That the vendor holds a current, valid elevator contractor license issued by the state

Answer

That the vendor has liability insurance only

Answer

That the vendor provides the lowest bid

Answer

That the vendor has worked in the state for at least ten years

Question 7

What is the best practice when a longtime vendor requests a significant price increase at contract renewal?

Accepted Answer

Solicit competing bids to benchmark market pricing before negotiating or accepting the increase

Answer

Accept the increase immediately to avoid disrupting the relationship

Answer

Reject any increase and threaten termination

Answer

Ask another board member's opinion without researching market rates