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

A performance bond is issued by a surety company and pays the association to complete the project if the bonded contractor defaults.

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

Written documentation and formal notice creates a record of non-performance and gives the vendor an opportunity to cure, as required by most contracts before termination.

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

Without a signed contract, enforcing agreed-upon terms, resolving disputes, and establishing liability becomes legally difficult.

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

Proactive review before an auto-renewal deadline preserves the association's negotiating position and ensures competitive pricing is maintained.

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

An indemnification clause shifts legal and financial responsibility to the vendor for claims caused by their own negligence or misconduct.

CCM - Certified Community Manager Practice Test

CCM - Certified Community Manager Practice Test

CCM Vendor & Contractor Management 3