CDCS self-test

Question 1
Marked out of 1

Question text
If the term ‘exporting country’ is used in a credit without further definition being given in the credit as to its
meaning, it shall have which of the following meanings?

1. The country where the shipper is domiciled.

2. The country of origin of the goods.

3. The country of receipt of the goods by the carrier.

4. The country from which shipment or dispatch is made.

Select one:
A. 1 and 2 only.
B. 1, 2 and 4 only.
C. 3 and 4 only.
D. 2, 3 and 4 only.
Question 2 Marked out of 1

Question text
Which of the following documents must be dated?

1. Commercial invoice.
2. Insurance certificate.

3. Non-negotiable sea waybill.

4. Certificate of origin.

Select one:
A. 1 and 2 only.
B. 2 and 3 only.
C. 2 and 4 only.
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D. 1, 2 and 4 only.
Question 3 Marked out of 1

Question text
A credit requires presentation of an insurance certificate covering risks in accordance with Institute Cargo Clauses
(A). Which of the following would also be acceptable?

1. An insurance policy covering ‘all risks’.

2. An insurance policy covering ‘Institute Cargo Clauses (A)’.

3. An insurance certificate covering risks in accordance with Institute Cargo Clauses

(B).

4. An insurance certificate covering risks in accordance with Institute Cargo Clauses

(C).

Select one:
A. 1 only.
B. 2 only.
C. 3 and 4 only.
D. 1 and 2 only.
Question 4 Marked out of 1

Question text
A credit that requires presentation of an invoice will be satisfied by which of the following?

1. Commercial invoice.
2. Proforma invoice.

3. Sales invoice.

4. Tax invoice.

Select one:
A. 1 only.
B. 1 and 3 only.

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C. 2 and 4 only.
D. 1, 3 and 4 only.
Question 5 Marked out of 1

Question text
A credit requires an insurance document to be issued ‘irrespective of percentage’. What is the meaning of this
terminology?
Select one:
A. The insurance coverage can be for any value provided that the minimum coverage is not less than the CIF or
CIP invoice value of the goods.
B. The insurance coverage can be for any value provided that the minimum coverage is the CIF or
CIP invoice value of the goods plus 10 per cent.
C. The insurance document must not contain a clause stating that cover is subject to a franchise or excess
deductible.
D. The insurance cover must be ‘all risks’ or equivalent.
Question 6 Marked out of 1

Question text
Which of the following statements about drafts are correct?

1. It must be dated.
2. It must state its value in both words and figures.

3. There should be no conflict between the amount in words and figures.

4. Corrections and alterations need not be authenticated.

Select one:
A. 1 and 3 only.
B. 1, 2 and 3 only.
C. 1, 3 and 4 only.
D. 2 and 3 only.
Question 7 Marked out of 1

Question text
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A credit is issued for USD 350,000 on a cumulative basis allowing for 10 monthly draw downs of USD 35,000.
Assuming that USD 33,000 is drawn in month one and that USD 28,000 is drawn in month two, what is the
amount that can be drawn in month three?
Select one:
A. USD 35,000.
B. USD 42,000.
C. USD 44,000.
D. USD 105,000.
Question 8 Marked out of 1

Question text
Documents are presented against a credit calling for drafts drawn at 15 days after bill of lading date. Assuming
that the shipped on board date indicated on the bill of lading is 10 April XXXX, then which of the following will be
acceptable?

1. Drafts drawn payable on 25 April XXXX.

2. Drafts drawn payable at 15 days after 10 April XXXX.

3. Drafts drawn payable at 15 days after bill of lading date with no indication
elsewhere on the face of the draft of the actual bill of lading date.

4. Drafts drawn payable at 15 days from bill of lading dated 10 April XXXX.

Select one:
A. 1 and 2 only.
B. 1, 2 and 3 only.
C. 1, 2 and 4 only.
D. 3 and 4 only.
Question 9 Marked out of 1

Question text
Which of the following can be considered as original transport documents?

1. Delivery note.
2. Forwarder’s cargo receipt.

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 3. Non-negotiable sea waybill.

4. Rail transport document marked ‘duplicate’.

Select one:
A. 1 and 2 only.
B. 2 and 3 only.
C. 3 and 4 only.
D. 4 only.
Question 10 Marked out of 1

Question text
A transferable letter of credit is issued in favour of company A. The value of the credit is USD 85,000 and states
the incoterms as CIF. The documentary requirements include ‘Insurance certificate covering all risks’, without any
further qualification within the credit.
Company A requests that the credit be transferred to its sole supplier, Company B, to the value of USD 60,000.
How should the insurance requirements be best expressed in the transferred credit?
Select one:
A. Insurance certificate for a minimum of 110% of the CIF invoice value of the goods covering all risks.
B. Insurance certificate for a minimum of 142% of the CIF invoice value of the goods covering all
risks.
C. Insurance certificate for a minimum of 156% of the CIF invoice value of the goods covering all risks.
D. Insurance certificate covering all risks.
Question 11

A credit requires presentation of invoice in three copies and also requires presentation of a beneficiary certificate
stating that an original invoice plus one copy has been sent direct to the applicant. Which of the following would
be acceptable under the credit?

1. Presentation of three original invoices.

2. Presentation of one original invoice and two copies.

3. Presentation of two copy invoices.

4. Presentation of three copy invoices.

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Select one:
A. 1 and 2 only.
B. 3 and 4 only.
C. 3 only.
D. 4 only.
Question 12 Marked out of 1

Question text
A transferred credit must accurately reflect the terms and conditions of the credit with the exception of:

1. the period for presentation, which may be reduced or curtailed.

2. the latest shipment date or given period for shipment, which may be reduced or
curtailed.

3. confirmation, which can be restricted so as not to apply to the transferred credit.

4. any documents which the beneficiary is required to issue.

Which of the above statements are correct?

Select one:
A. 1 and 2 only.
B. 1, 2 and 3 only.
C. 2, 3 and 4 only.
D. 1 and 4 only.
Question 13 Marked out of 1

Question text
Which of the following statements in respect of transferable credits are correct?

1. A credit may be transferred in part to more than one second beneficiary provided
that partial drawings or shipments are allowed.
2. A transferred credit can be transferred by a second beneficiary to a subsequent
beneficiary only with the express agreement of the first beneficiary.

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 3. Presentation of documents by or on behalf of a second beneficiary must be made
to the transferring bank.

4. The name of the first beneficiary must be substituted for that of the applicant in the
credit.

Select one:
A. 1, 2 and 3 only.
B. 1, 2 and 4 only.
C. 1 and 3 only.
D. 3 and 4 only.
Question 14 Marked out of 1

Question text
A credit states shipment is to be effected from any UK port to any Chinese port and requires presentation of
charter party bills of lading. Which of the following would be acceptable?

1. Charter party bills of lading evidencing port of loading as ‘any UK port’ and port of
discharge as ‘any Chinese port’.
2. Charter party bills of lading evidencing port of loading as ‘any UK port’ and port of
discharge as ‘Shanghai port’.

3. Charter party bills of lading evidencing port of loading as ‘Southampton port’ and
port of discharge as ‘any Chinese port’.

4. Charter party bills of lading evidencing port of loading as ‘Southampton port’ and
port of discharge as ‘Shanghai port’.

Select one:
A. 1 and 2 only.
B. 2, 3 and 4 only.
C. 3 and 4 only.
D. 4 only.
Question 15 Marked out of 1

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Question text
Which of the following statements is correct?
Select one:
A. A non-negotiable sea waybill must not contain or make any reference to another source containing the terms
and conditions of carriage.
B. A non-negotiable sea waybill must indicate that goods have been shipped on board .
C. A non-negotiable sea waybill is issued in one original only.
D. A non-negotiable sea waybill need not name the carrier.
Question 16
Marked out of 1

Question text
Which of the following can be disregarded?

1. A document not required by the terms of the credit.

2. A mail confirmation of an authenticated teletransmitted credit.

3. A provision in an amendment stating that it shall enter into force unless rejected by
the beneficiary within a stated time period.

4. Any reference within a credit to the word ‘immediately’.

Select one:
A. 1 and 2 only.
B. 1, 2 and 3 only.
C. 1, 3 and 4 only.
D. 3 and 4 only.
Question 17 Marked out of 1

Question text
A credit requires shipment of ‘100 tonnes of wheat’ and requires presentation of: ‘Certificate of inspection issued
by an official inspection laboratory’. Which of the following documents would be acceptable?

1. A certificate of inspection issued by the beneficiary’s inspection laboratory stating

that the wheat has been inspected.

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 2. A certificate of inspection issued by the beneficiary’s inspection laboratory stating
that the wheat has passed inspection and meets quality standards.

3. A certificate of inspection issued by an independent inspection agency stating that

the wheat is not fit for human consumption.

4. A certificate of inspection issued by an independent inspection agency stating that

the wheat has passed inspection and meets quality standards.

Select one:
A. 2 and 4 only.
B. 1, 2 and 3 only.
C. 1 and 2 only.
D. 3 and 4 only.
Question 18 Marked out of 1

Question text
A credit requires shipment of ‘100 tonnes of grade A quality steel scrap’. The credit requires presentation of an
invoice, a packing list and a transport document and states partial shipments are not allowed. Which of the
following statements are correct?

1. Both the packing list and the transport document can simply show the goods
description as ‘steel scrap’.
2. A tolerance of up to 5% more and 5% less automatically applies to both the value of
the credit and the amount that may be drawn there under.

3. No more than 100 tonnes of steel scrap may be shipped but a tolerance of up to
5% below this amount is acceptable.

4. The stated quantity of the goods can be exceeded by a maximum of 5% provided

that the amount of the drawings does not exceed the overall credit value by more
than 5%.

Select one:
A. 1 only.
B. 1 and 2 only.
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C. 1 and 3 only.
D. 4 only.
Question 19 Marked out of 1

Question text
A credit requires presentation of an invoice, packing list, bill of lading and an inspection certificate. Which of the
following statements within the additional conditions of the credit are deemed as not stated and can be
disregarded?

1. Cartons must be marked ‘ABC Ltd’.

2. Goods must be of grade A quality.

3. Goods must be of Indonesian origin.

4. Goods must be packed in six cartons.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 3 only.
D. 3 and 4 only.
Question 20 Marked out of 1

Question text
A credit contains the following statement in the additional conditions – ‘stale documents are acceptable’. What is
your understanding of this statement?
Select one:
A. Documents presented later than 21 days after the date of shipment are acceptable as long as they
are presented within the credit expiry date.
B. Documents presented later than the credit expiry date are acceptable provided they are presented no later
than 21 days after the date of shipment.

C. Documents presented later than the credit expiry date and later than 21 days after the date of shipment are
acceptable.
D. Documents presented evidencing shipment after the stated latest shipment date are acceptable provided they
are presented no later than 21 days after the date of shipment and within the credit expiry.

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Question 21 Marked out of 1

Which of the following documents must be signed?

1. Certificate.
2. Commercial invoice.

3. Declaration.

4. Postal receipt.

Select one:
A. 1 and 2 only.

B. 1, 2 and 3 only.

C. 1, 3 and 4 only

D. 2 and 4 only.

Question 22 Marked out of 1

Question text
A credit requires shipment of 100,000 tonnes of scrap steel to be shipped in five separate shipments of 20,000
tonnes each with shipments to be made in January, February, March, April and May.
Documents are presented in five separate sets evidencing shipment as follows: January 20,000 tonnes; February
21,000 tonnes; March 18,500 tonnes; April 19,500 tonnes and May 20,000 tonnes.
Assuming documents otherwise comply with the credit terms, which of the above presentations would be found to
be discrepant?
Select one:

A. February only.

B. March only.

C. March and April only.

D. March, April and May only.

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Question 23 Marked out of 1

Question text
Which of the following are clear examples of data conflict between documents?

1. A bill of lading indicating the consignee as the applicant and a certificate of origin indicating the consignee
as the issuing bank.
2. A bill of lading indicating the container number THSE12349678 and a packing list indicating the container
number THES12439687.

3. An invoice stating the goods description as ‘clothing’ and a packing list stating the goods as being
‘trousers and skirts’.

4. An invoice stating the goods description as ‘concrete pillars’ and a packing list stating the goods as being
‘pillars’.

Select one:
A. 1 and 2 only.

B. 1 and 3 only.

C. 3 and 4 only.

D. 2 and 4 only.

Question 24 Marked out of 1

Question text
Which of the following availability options are correct in respect of a credit stated to be available with the issuing
bank?

1. By acceptance with drafts at 60 days sight drawn on the issuing bank.

2. By deferred payment with drafts at 60 days sight drawn on the issuing bank.

3. By negotiation with drafts at sight drawn on the issuing bank.

4. By payment with drafts at sight drawn on the issuing bank.

Select one:
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A. 1 and 3 only.

B. 1 and 4 only.

C. 1, 2 and 4 only.

D. 2 and 4 only.

Question 25 Marked out of 1

Question text
A credit is issued for an amount of ‘about USD 70,000’ allowing for partial shipments. A complying presentation is
honoured for USD 25,000. An amendment is then issued increasing the credit by USD 45,000.
Assuming that the amendment is accepted by the beneficiary, what is the maximum amount that remains to be
drawn under the credit?
Select one:

A. USD 90,000.

B. USD 95,750.

C. USD 97,000.

D. USD 101,500.

Question 26 Marked out of 1

Question text
Which of the following require corrections or alterations to be authenticated?

1. A certificate of origin certified by a chamber of commerce.

2. A commercial invoice issued by the beneficiary.

3. A commercial invoice issued by the beneficiary and legalised by consular authorities.

4. An inspection certificate issued by the beneficiary

Select one:
A. 1 only.

B. 1 and 3 only.
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C. 2 and 3 only.

D. 2 and 4 only.

Question 27 Marked out of 1

Question text
Which of the following are recognised risk statements in relation to insurance documents to be presented under a
credit?

1. All risks.
2. Associated risks.

3. Customary risks.

4. Institute Cargo Clauses (B) risks.

Select one:
A. 1 only.

B. 1 and 2 only.

C. 2 and 3 only.

D. 1 and 4 only.

Question 28 Marked out of 1

Question text
With specific regards to amendments to credits, which of the following statements are incorrect?

1. An amendment only becomes binding on the beneficiary after it has been advised to the beneficiary.
2. A beneficiary that presents documents that comply with the terms of an amended credit is deemed to
have accepted that amendment.

3. All amendments must either be accepted or rejected by the beneficiary within a month of issue otherwise
they are deemed to have been accepted.

4. Separate amendments can be accepted or rejected regardless of the order in which they have been
issued.

Select one:

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A. 1 and 3 only.

B. 1 and 4 only.

C. 2 and 3 only.

D. 2 and 4 only.

Question 29 Marked out of 1

Question text
Which of the following incoterms specifically require the beneficiary to arrange to insure the goods up to the point
of delivery?
Select one:

A. DDP.

B. EXW.

C. FOB.

D. CIF.

Question 30 Marked out of 1

Question text
Which of the following statements are correct?

1. All credits are deemed to be irrevocable unless otherwise stated.

2. A revocable credit can be cancelled at any point in time without the prior agreement of the beneficiary.

3. A preliminary advice of a credit does not bind the issuing bank until it issues the operative credit.

4. Advising a preliminary advice of a credit to a beneficiary does not oblige the advising bank to then
formally advise the operative credit to the beneficiary.

Select one:
A. 1 and 3 only.

B. 1 and 4 only.

C. 2 and 3 only.
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D. 2 and 4 only.

Question 31 Marked out of 1

Question text
A credit requires goods to be shipped at the beginning of August. What constitutes the beginning of the month (all
dates inclusive)?
Select one:
A. 1 August to 5 August.
B. 1 August to 7 August.
C. 1 August to 10 August.
D. 1 August to 15 August.
Question 32 Marked out of 1
Question text
Documents are presented under a credit on Thursday 3 May XXXX. Assuming that the bank is only closed for
business on Saturdays and Sundays, which date is the latest date by which a bank could give a notice of refusal?
Select one:
A. Monday 7 May XXXX.
B. Tuesday 8 May XXXX.
C. Wednesday 9 May XXXX.
D. Thursday 10 May XXXX.
Question 33 Marked out of 1
Question text
Which of the following would be acceptable in a credit that prohibits partial shipments? Presentation of:

1. more than one set of bills of lading evidencing shipment on the same means of
conveyance, showing goods laden on board the vessel on different dates at
different ports of loading but for the same journey.
2. more than one original certificate of posting, each stamped or signed by the same
postal service at the same place and date and for the same destination.

3. more than one original road transport document, each evidencing shipment on
different means of conveyance on the same date for the same journey.

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 4. one original road transport document evidencing shipment on different means of
conveyance on the same date for the same journey.

Select one:
A. 1 and 2 only.
B. 1 and 4 only.
C. 2 and 3 only.
D. 2 and 4 only.
Question 34 Marked out of 1
Question text
Documents value GBP 78,000 are presented as a full drawing of a transferred credit and include an insurance
certificate. The original credit value is GBP 112,000 and requires presentation of an insurance certificate but is
silent as to the percentage of insurance cover required.
What percentage of insurance value should have been requested at the time of transfer?
Select one:
A. 143.59%.
B. 148.25%.
C. 157.95%.
D. 164.87%.
Question 35 marked out of 1
Question text
With which of the following combinations of incoterms does the delivery risk pass from the seller to the buyer at
the same point?
Select one:
A. CIP and DAT.
B. DAP and DAT.
C. EXW and FCA.
D. FOB and CFR.
Question 36 Marked out of 1
Question text
Which of the following statements are correct?

1. On deck shipment is only allowed if the credit requires presentation of charter party
bills of lading.
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 2. ‘Laden on board’ does not have the same meaning and effect as ‘shipped on
board’.

3. An annotation on the bill of lading that packaging may not be sufficiently robust for
the journey is acceptable.

4. Notify party details must always appear on bills of lading issued to order of the
shipper.

Select one:
A. 2 only.
B. 3 only.
C. 1 and 2 only.
D. 3 and 4 only.
Question 37 Marked out of 1
Question text
Invoices are not acceptable that:

1. indicate a deduction for a discount not stated in the credit.

2. cover merchandise not stated in the credit.

3. are issued for an amount in excess of the amount permitted by the credit.

4. fail to state the credit number.

Select one:
A. 2 only.
B. 1 and 2 only.
C. 1 and 3 only.
D. 3 and 4 only.
Question 38 Marked out of 1

Question text
In the context of credits, an assignment is:
Select one:

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A. a legal agreement between the beneficiary and a stated third party under which the beneficiary agrees that
proceeds of drawing(s) under the credit are to be paid to that third party.
B. an instruction given by the beneficiary upon presentation of documents requesting that proceeds of
the drawing be paid to a stated third party.
C. a notice from the beneficiary that allows a stated third party to draw against the credit.
D. a notice from the beneficiary that requests that the nominated bank acknowledge the rights of a stated third
party to draw against the credit.
Question 39 Marked out of 1
Question text
Which of the following statements are correct?

1. A confirming bank is obligated to discount any deferred payment undertaking that it

has given.
2. A confirming bank is obligated to discount any draft drawn on it that it has accepted
for payment at maturity.

3. A confirming bank is not obligated to extend its confirmation to cover any

amendments made to the credit.

4. The obligations of a confirming bank cease upon presentation of discrepant

documents but are automatically reinstated should the issuing bank take up those
documents prior to the credit expiry.

Select one:
A. 1 and 2 only.
B. 2 and 3 only.
C. 3 only.
D. 2 and 4 only.
Question 40 Marked out of 1
Question text
Which of the following Incoterms for shipments by sea imposes the most delivery risk on the buyer?
Select one:
A. FAS.
B. FCA.
C. FOB.
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D. CFR.

Question 41 Marked out of 1

Question text
Which of the following transport documents can be considered as ‘clean’?

1. An air waybill indicating that one of the cartons has split open.
2. A bill of lading indicating that a single barrel of oil is leaking.

3. A charter party bill of lading indicating that the packaging may not be suitable for
sea shipment.

4. A multimodal transport document indicating that the goods are scratched and
dented.

Select one:
A. 1 and 3 only.
B. 2 only.
C. 3 only.
D. 3 and 4 only.
Question 42 Marked out of 1
Question text
Documents are presented under a credit issued for USD 10,000 which states the following goods description
‘newly machined engine’ and the incoterms as ‘CIF Felixstowe’. Which elements of the following presentations
would be considered as discrepant?

1. An invoice indicating samples shipped free of charge.

2. An invoice stating the goods description as ‘newly machined engine parts’.

3. An invoice stating the goods description as ‘newley mechined tractor engine’.

4. An invoice stating the incoterms as ‘CIF Felixstowe (Incoterms® 2010)’.

Select one:
A. 1 only.
B. 1 and 2 only.
C. 1 and 3 only.
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D. 3 and 4 only.
Question 43 Marked out of 1
Question text
A credit is issued for about USD 97,000. Assuming that a presentation of USD 83,250 has already been drawn,
what is the remaining balance that may be drawn under this credit?
Select one:
A. USD 13,750.
B. USD 16,660.
C. USD 18,600.
D. USD 23,450.
Question 44 Marked out of 1
Question text
A credit requires presentation of an air transport document covering shipment from London to Tokyo without
transhipment. Which of the following would be acceptable?

1. An air transport document indicating the name of the carrier and signed by the
carrier indicating the airport of departure as London Heathrow, the airport of
destination as Narita Tokyo, and that the goods will be transhipped at Singapore
airport.
2. An air waybill signed by the carrier indicating the airport of departure as LHR and
airport of destination as Narita Tokyo.

3. A house air waybill which fails to indicate the name of the carrier and signed by the
forwarder indicating that they were acting as agents of the carrier, indicating airport
of departure as London Heathrow and airport of destination as Narita Tokyo.

4. Two separate air transport documents both issued and signed by the same carrier,
one of which evidences shipment from London Heathrow to Singapore and the
other of which evidences shipment from Singapore to Narita Tokyo.

Select one:
A. 1 and 2 only.
B. 1 and 4 only.
C. 3 and 4 only.

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D. 2 and 3 only.
Question 45 Marked out of 1
Question text
The credit requires goods shipment to be effected ‘on or about’ 15 May XXXX. What is your understanding of this
term?
Select one:
A. Shipment has to be effected between 14 May XXXX and 16 May XXXX, both dates inclusive.
B. Shipment has to be effected between 12 May XXXX and 18 May XXXX, both dates inclusive.
C. Shipment has to be effected between 10 May XXXX and 20 May XXXX, both dates inclusive .
D. Shipment has to be effected between 8 May XXXX and 22 May XXXX, both dates inclusive.
Question 46 Marked out of 1
Question text
Which of the following roles cannot be performed by an advising bank?
Select one:
A. Confirming bank.
B. Issuing bank.
C. Negotiating bank.
D. Transferring bank.
Question 47 Marked out of 1
Question text
According to UCP 600, the first beneficiary of a transferred credit has the right to substitute which of the following
documents?

1. Beneficiary certificate.
2. Drafts.

3. Invoice.

4. Packing list.

Select one:
A. 1 and 3 only.
B. 1, 2 and 3 only.
C. 2 and 3 only.
D. 2, 3 and 4 only.
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Question 48 Marked out of 1
Question text
An applicant instructs their bank to issue a credit for approximately 8,000 units of battery packs each costing USD
4.50. How should the value of the credit be expressed?
Select one:
A. About USD 43,560.
B. About USD 39,600.
C. About USD 37,800.
D. About USD 36,000.
Question 49 Marked out of 1
Question text
Which of the following statements apply if a credit is available by negotiation? The:

1. beneficiary cannot present documents direct to the issuing bank.

2. credit can be stated to be available with any bank.

3. availability must be restricted to a nominated bank.

4. credit need not require the presentation of drafts.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 4 only.
D. 3 and 4 only.
Question 50
Marked out of 1
Question text
If a letter of credit states that costs additional to freight are not acceptable, which of the following would not be
acceptable on a bill of lading?
Select one:
A. Charges associated with the unloading of goods.
B. Charges for late return of a container.
C. Charges resultant from a delay in unloading the goods.
D. Reference to demurrage charges.

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Question 51 Marked out of 1
Question text
Which of the following statements about insurance documents are correct?

1. All originals must be presented.

2. They cannot be issued by an underwriter.

3. They cannot indicate that cover is subject to a franchise or excess deductible.

4. They may contain reference to any exclusion clause.

Select one:
A. 1 and 3 only.
B. 1 and 4 only.
C. 2 and 3 only.
D. 2 and 4 only.
Question 52 Marked out of 1

Question text
An insurance document is issued with a franchise of 5% applicable on any claims. Which of the following
statements is correct?
Select one:
A. Claims attract ‘stamp duties’ or taxes of 5% of the amount of the claim.
B. If the loss payable is less than 5% of the insured value, the insurer is not liable.
C. If the loss payable is more than 5% of the insured value, the insurer is liable for only 95% of the
insured value.
D. The first 5% of any claim is payable by the insured party.
Question 53 Marked out of 1
Question text
In which of the following circumstances are you most likely to be asked to provide an indemnity to a shipping
company? To obtain the release of goods without having:
Select one:
A. a full set of original air waybills.
B. a full set of original bills of lading
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C. an original air waybill.
D. an original bill of lading.
Question 54 Marked out of 1
Question text
Credits which include the option to present either bills of lading or a letter of indemnity if the bills of lading are not
available, are most commonly associated with shipments of:
Select one:
A. dangerous goods.
B. livestock.
C. machinery.
D. oil.
Question 55 Marked out of 1
Question text
Which of the following statements are correct?

1. All credits (excluding standby credits) must be issued subject to UCP 600 rules.
2. Application of UCP 600 is subject to local laws and regulations.

3. The applicant is a party to a letter of credit.

4. Documents honoured by a nominated bank place no liability on the issuing bank if

they are subsequently proven to be fraudulent.

Select one:
A. 2 only.
B. 1 and 2 only.
C. 1 and 3 only.
D. 3 and 4 only.
Question 56 marked out of 1

Question text
Which of the following statements are correct?

1. Acceptance of a draft by a nominated bank that is not a confirming bank does not
make that bank liable to honour that draft at maturity.
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 2. Examination of documents by a nominated bank that is not a confirming bank does
not make that bank liable to honour those documents.

3. Issuance of a deferred payment undertaking by a nominated bank that is not a

confirming bank does not make that bank liable to make payment at maturity.

4. Receipt of documents by a nominated bank that is not a confirming bank does not
make that bank liable to honour those documents.

Select one:
A. 1 and 3 only.
B. 2 and 3 only.
C. 2 and 4 only.
D. 3 and 4 only.
Question 57 Marked out of 1

Question text
Which of the following documents must contain the description of goods in a manner which corresponds with that
stated in the credit?
Select one:
A. Certificate of origin.
B. Commercial invoice.
C. Draft.
D. Transport document.
Question 58 Marked out of 1

Question text
A credit subject to eUCP calls for the presentation of an electronic record. Which of the following statements are
correct?

1. The credit must state a place of presentation.

2. The electronic record must be in a format that is capable of being accepted by the
recipient system at the issuing bank.

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 3. The electronic record presented need not be authenticated and is deemed to be a
presentation on behalf of the named beneficiary.

4. Notice of refusal of an electronic presentation, if applicable, must be given within a

maximum of three banking days after the date of receipt of an electronic
presentation.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 4 only.
D. Three separate electronic records plus two paper copies.
Question 59 Marked out of 1

Question text
A credit subject to eUCP calls for the presentation of an electronic record in three originals and two copies. Which
of the following is the minimum required that must be met to satisfy that condition?
Select one:
A. One sole electronic record.
B. One sole electronic record plus four paper copies.
C. Five separate electronic records.
D. Three separate electronic records plus two paper copies.
Question 60 Marked out of 1

Question text
If the nominated bank requests that an apparently corrupted electronic record be re-presented, which of the
following applies under eUCP?

1. Any deadlines are not extended.

2. The electronic record must be re-presented within 7 banking days following the
date of said request.

3. The nominated bank need not advise the issuing bank of the request for re-
presentation unless specifically so requested by the presenter.

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 4. The time for examination is suspended and resumes on re-presentation of the
electronic record.

Select one:
A. 1 and 3 only.
B. 1 and 4 only.
C. 2 and 3 only.
D. 2 and 4 only.

Question 61 Marked out of 1

Question text
Which of the following statements about eUCP are correct?

1. An electronic record cannot evidence transport of the underlying goods.

2. An electronic record may be presented direct to the issuing bank instead of the
nominated bank.

3. An electronic record must be capable of being checked as received without

reference to any external systems.

4. An electronic record that cannot be authenticated is deemed not to have been

presented.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 3 only.
D. 2 and 4 only.
Question 62 Marked out of 1

Question text
Which of the following statements are correct when applied to a reimbursement authorisation issued subject to
URR 725?

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 1. The claiming bank must indicate that all terms and conditions of the underlying
credit have been met.
2. The reimbursing bank can disregard any claim submitted to it more than seven
banking days prior to any predetermined due date.

3. The reimbursing bank can disregard any indication by the claiming bank that
payment has been made under reserve.

4. Unless a reimbursement authority states otherwise, all charges thereunder will be

for the account of the issuing bank.

Select one:
A. 1 and 4 only.
B. 2 and 3 only.
C. 1 and 2 only.
D. 3 and 4 only.
Question 63 Marked out of 1

Question text
Which of the following statements are correct when applied to URR 725?

1. A reimbursement undertaking cannot be amended or cancelled without agreement

of the claiming bank.
2. A reimbursement undertaking is not an appropriate instrument when the underlying
credit is stated to be freely available.

3. A reimbursement undertaking should not contain a latest date for presentation of

claims.

4. A reimbursement undertaking will require the claiming bank to certify that all terms
of the underlying credit have been complied with.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.

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C. 1 and 4 only.
D. 2 and 4 only.
Question 64 Marked out of 1

Question text
A reimbursement authorisation issued subject to URR 725 requires presentation of a time draft drawn at 60 days
sight on the reimbursing bank. The underlying credit covers the shipment of goods rather than services or other
performance.
As a minimum, what additional information must the claiming bank include on submission of the draft?
Select one:
A. The date of sighting of the draft, the date of shipment, the place of shipment, the description of goods and the
place of destination.
B. The date of sighting of the draft, the date of shipment, the place of shipment, the description of goods, the
country of origin and the place of destination.
C. The date of shipment, the place of shipment, the description of goods and the place of destination.
D. The date of shipment, the place of shipment, the description of goods, the country of origin and the place of
destination.
Question 65 Marked out of 1

Question text
What characteristics are shared by a reimbursement authorisation and a reimbursement undertaking? They:

1. may both be issued in favour of a nominated claiming bank.

2. may both only be amended with the agreement of all parties thereto.

3. must both contain clearly stated latest dates for presentation of claims.

4. need not contain a clear statement as to the party liable for charges thereunder.

Select one:
A. 1 and 2 only.
B. 1 and 4 only.
C. 2 and 3 only.
D. 3 and 4 only.
Question 66 Marked out of 1

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Question text
Under URR 725, a reimbursing bank has a maximum of how many banking days following the date or receipt of a
claim to process the claim?
Select one:
A. 2 banking days
B. 3 banking days.
C. 5 banking days.
D. 7 banking days.
Question 67 Marked out of 1

Question text
Which of the following statements is incorrect?
An issuer of a standby subject to ISP98 is not responsible for:
Select one:
A. accuracy, genuineness or effect of any document presented under the standby.
B. actions or omission of others except when the other person is chosen by the issuer.
C. observance of law or practice other than that chosen in the standby or applicable at the place of issuance.
D. performance or breach of any underlying transaction.
Question 68 Marked out of 1

Question text
Which of the terms stated below have no single accepted meaning within ISP98 and shall be disregarded?

1. Absolute.
2. Callable.

3. Transmissible.

4. Unconditional.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
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C. 2 and 3 only.
D. 2 and 4 only.
Question 69 Marked out of 1

Question text
Which of the following statements, when applied to amendments to standbys issued subject to ISP98, are
correct?

1. A standby subject to ‘automatic amendment’ by way of a stated decrease in the

amount available requires the consent of the beneficiary to that amendment, when
issued.
2. A standby subject to ‘automatic amendment’ by way of a stated increase in the
amount available requires the consent of the beneficiary to that amendment, when
issued.

3. An amendment does not require the applicant’s consent to be binding on the issuer,
the confirmer or the beneficiary.

4. Consent to only part of an amendment is a rejection of the entire amendment.

Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 4 only.
D. 3 and 4 only.
Question 70 Marked out of 1

Question text
Under ISP98, the use of the word ‘circa’ permits a percentage tolerance in the amount to which the word refers of:
Select one:
A. Zero tolerance.
B. 2%
C. 5%
D. 10%
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Question 71 Marked out of 1

Question text
A beneficiary’s request to extend the expiration date of a standby issued subject to ISP98 or, alternatively, to pay
the amount available under it:

1. implies that the beneficiary consents to the amendment to extend the expiry date to
the date requested.
2. implies that the beneficiary consents to the maximum time available under these
rules for examination and notice of dishonour.

3. obliges the issuer to issue that amendment.

4. obliges the issuer to seek the approval of the applicant and to issue that
amendment.

Select one:
A. 1 and 2 only.
B. 2 and 3 only.
C. 2 and 4 only.
D. 3 and 4 only.
Question 72Marked out of 1

Question text
Which of the following statements are correct when applied to ISP98?

1. An issuer is required to notify the applicant of receipt of a presentation under a

standby.
2. Any required document must be issued by the beneficiary unless the standby
indicates that the document is to be issued by a third party or is the type of
document that practice would dictate be issued by a third party.

3. Documents issued by the beneficiary must be in the language of the standby.

4. If the original standby is lost, stolen or mutilated, the issuer is obliged to replace it.
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Select one:
A. 1 and 2 only.
B. 1 and 3 only.
C. 2 and 3 only.
D. 3 and 4 only.
Question 73 Marked out of 1

Question text
A standby credit subject to ISP98 is considered to be issued when it leaves the issuer’s control unless it
specifically states that it is not:
Select one:
A. available.
B. effective.
C. enforceable.
D. operative.
Question 74 Marked out of 1

Question text
A standby issued subject to ISP98 that is stated to be transferable without further provision means that drawing
rights may be transferred in:
Select one:
A. their entirety only once.
B. part only once.
C. their entirety more than once.
D. their entirety more than once only with the express agreement of the applicant.
Question 75 Marked out of 1

Question text
Which of the following reflects the rule stated in ISP98 regarding timely notice of dishonour after presentation of
documents? Notice given within:
Select one:
A. one business day is reasonable and beyond three business days is deemed unreasonable.

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B. two business days is reasonable and beyond five business days is deemed unreasonable.
C. three business days is reasonable and beyond five business days is deemed unreasonable.
D. three business days is reasonable and beyond seven business days is deemed unreasonable .

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