Modification History
PSPPROC505A Release 2: Layout adjusted. No changes to content.
PSPPROC505A Release 1: Primary release.
Unit Descriptor
This unit covers the ability to manage risks associated with all stages of procurement. It includes assessing risk, and preparing, implementing and reviewing a risk management plan.
In practice, managing procurement risk may overlap with other public sector and local government generalist and specialist work activities, such as promoting the values and ethos of public service or local government, undertaking negotiations, promoting compliance with legislation in the public sector, managing contract performance, finalising contracts, planning to manage a contract, planning for procurement outcomes and making procurement decisions.
No licensing, legislative, regulatory or certification requirements apply to this unit at the time of endorsement.
Application of the Unit
The unit applies to those in specialist procurement who plan for procurement risks across all stages of the procurement cycle.
Licensing/Regulatory Information
Not applicable.
Pre-Requisites
Not applicable.
Employability Skills Information
This unit contains employability skills.
Elements and Performance Criteria Pre-Content
Elements describe the essential outcomes of a unit of competency. |
Performance criteria describe the performance needed to demonstrate achievement of the element. Where bold italicised text is used, further information is detailed in the range statement. Assessment of performance is to be consistent with the evidence guide. |
Elements and Performance Criteria
ELEMENT |
PERFORMANCE CRITERIA |
1. Assess risk |
1.1. Legislation , policies , business processes and resources impacting on the contract are identified. 1.2. Procurement outcomes and internal inputs necessary for effective performance are identified. 1.3. Critical success factors necessary for the achievement of procurement outcomes are identified and confirmed. 1.4. Non-trivial procurement risks relating to the procurement activity are identified. 1.5. Potential probity risks are identified. 1.6. Causes of risk are analysed and their potential impact is determined. 1.7. Likelihood and consequences of risks are determined and risk assessments are developed. |
2. Prepare risk management plan |
2.1. Preliminary risk management plan is developed that addresses risks identified in planning phase of procurement activity. 2.2. Risks that will be accepted and those requiring treatment are identified. 2.3. Treatments that reduce risks to an acceptable level are designed according to organisational requirements. 2.4. Plan for implementing new treatments, additional risk controls or modifications to existing controls is developed. 2.5. Risk level is re-checked at key points during procurement process, and risk management plan is reviewed and adjusted to cover procurement activity risks not already identified. |
3. Implement and review risk management plan |
3.1. Risk controls and treatments are implemented according to the treatment plan. 3.2. Risk management plan is implemented, and regularly reviewed and revised to include potential or emerging risks during the life of the procurement activity. 3.3. Review results are used to improve risk treatments and controls. |
Required Skills and Knowledge
This section describes the skills and knowledge required for this unit. |
Required skills |
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Required knowledge |
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Evidence Guide
The Evidence Guide provides advice on assessment and must be read in conjunction with the performance criteria, required skills and knowledge, range statement and the Assessment Guidelines for the Training Package. |
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Overview of assessment |
Competency must be demonstrated in the ability to manage procurement risk consistently in accordance with legislative and organisational requirements. |
Critical aspects for assessment and evidence required to demonstrate competency in this unit |
Assessment must confirm the ability to:
Consistency in performance Competency should be demonstrated by providing evidence of undertaking a range of relevant work tasks in an actual or simulated procurement environment on at least two separate occasions. |
Context of and specific resources for assessment |
The unit of competency is to be assessed in the workplace or a simulated workplace environment. Access may be required to:
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Method of assessment |
The following assessment methods are suggested:
In all cases, practical assessment should be supported by questions to assess underpinning knowledge and those aspects of competency which are difficult to assess directly. Questioning techniques should suit the language and literacy levels of the candidate. |
Guidance information for assessment |
Evidence must be gathered over time in a range of contexts to ensure the person can achieve the unit outcome and apply the competency in different situations or environments. Holistic assessment with other units relevant to the industry sector, workplace and job role is recommended, for example:
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Range Statement
The range statement relates to the unit of competency as a whole. It allows for different work environments and situations that may affect performance. Bold italicised wording, if used in the performance criteria, is detailed below. Essential operating conditions that may be present with training and assessment (depending on the work situation, needs of the candidate, accessibility of the item, and local industry and regional contexts) may also be included. |
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Legislation and policies may include: |
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Procurement risks may include: |
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Probity risks may include: |
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Risk assessments differentiate between risks that have: |
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Risk management is often considered in relation to an organisation's: |
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Risk treatments may include those that: |
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Risk controls may include: |
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Unit Sector(s)
Not applicable.
Competency field
Procurement and Contract Management.