SC-900 Practice Question: Describe the capabilities of Microsoft compliance solutions
You work for a law firm that uses Microsoft 365 E5. The firm handles highly confidential client information and must comply with attorney-client privilege. You need to implement a compliance solution that: - Prevents unauthorized sharing of privileged documents via email. - Enables lawyers to easily classify documents as 'Privileged' and automatically encrypt them. - Allows the compliance team to monitor for accidental exposure of privileged information in Teams chats. - Ensures that privileged documents are retained for 7 years after case closure, then automatically deleted. - Provides the ability to search for privileged documents in case of a legal hold. What should you configure?
⚠ Common exam trap
SC-900 often tests the difference between Information Barriers (which restrict or block communication between groups) and Communication Compliance (which monitors communications for policy violations). Option D includes Information Barriers but omits Communication Compliance and DLP, and its sensitivity labels are not specified as encrypting, so it cannot meet the requirements for Teams chat monitoring, preventing unauthorized email sharing, or automatic encryption.
Answer choices
Why each option matters
Answer the question above first, then reveal the full breakdown to understand why each option is right or wrong.
Correct answer & explanation
✓
Sensitivity labels with encryption, DLP, Communication Compliance, Data Lifecycle Management, and eDiscovery
Sensitivity labels with encryption classify and encrypt privileged documents, DLP prevents unauthorized email sharing, Communication Compliance monitors Teams chats for accidental exposure, Data Lifecycle Management enforces 7-year retention then deletion, and eDiscovery supports legal hold searches. Together these Microsoft Purview solutions meet all five requirements. This combination is the only one that covers classification, encryption, monitoring, retention, and search.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Sensitivity labels with encryption, DLP, Communication Compliance, Data Lifecycle Management, and eDiscovery
Why this is correct
Sensitivity labels apply encryption at classification, satisfying the 'Privileged' tagging requirement. DLP blocks unauthorised email sharing, Communication Compliance monitors Teams chats, Data Lifecycle Management enforces the seven-year retention then deletion, and eDiscovery supports legal hold searches. Together these Microsoft Purview solutions cover every stated constraint.
- ✗
DLP, Communication Compliance, Data Lifecycle Management, and Audit (Standard)
Why it's wrong here
Missing classification and encryption; Audit (Standard) does not provide retention management.
- ✗
Insider Risk Management, DLP, Data Lifecycle Management, and eDiscovery
Why it's wrong here
Insider Risk Management does not classify or encrypt documents.
- ✗
Sensitivity labels, Information Barriers, Data Lifecycle Management, and eDiscovery
Why it's wrong here
Information Barriers do not prevent sharing or monitor Teams.
Go deeper
Related to this question
Learn chapter
Microsoft Entra Permissions Management
Key term
Encryption
Encryption is the process of converting readable data into a secret code to prevent unauthorized access.
Key term
Exposure
Exposure is the measure of potential loss or harm to an organization's assets when a vulnerability is exploited by a threat, often expressed as the window of time or degree of access an attacker has.
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JA
Written and reviewed by Johnson Ajibi, MSc IT Security
Senior Network & Security Engineer · founder of Courseiva
Last reviewed September 2026 · checked against the official Microsoft exam blueprint
This SC-900 practice question is part of Courseiva's free Microsoft certification practice question bank. Courseiva provides original exam-style practice questions with explanations, topic-based practice, mock exams, readiness tracking, and study analytics to help learners prepare for the SC-900 exam.