C_ARSUM Ariba Supplier Management Practice Question
Which THREE factors influence the risk profile of a supplier within the SAP Ariba Supplier Risk solution?
⚠ Common exam trap
Candidates often omit the 'CRD' (Commodity, Region, Department) factor, focusing only on external news or scorecards, which causes them to miss the critical internal classification aspect of risk profiling.
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
✓
Public news and financial reports.
Risk management requires a holistic approach. A supplier's risk score is derived from external data sources (like financial news or sanctions lists), internal performance data (from surveys and scorecards), and operational factors (such as the nature of the goods/services provided and the region of operation). By integrating these diverse sources, SAP Ariba provides a comprehensive risk assessment that allows procurement teams to identify potential threats early, enabling them to make informed decisions and implement necessary mitigation strategies effectively.
Answer analysis
Option-by-option breakdown
For each option: why learners choose it and why it is or isn't the right answer here.
- ✓
Public news and financial reports.
Why this is correct
External monitoring tools aggregate global news and financial reports to flag potential risks like instability, bankruptcies, or legal issues. This information is critical for assessing the long-term viability of a supplier and identifying potential supply chain disruptions before they negatively impact the organization's business operations and profitability.
- ✗
The number of employees in the supplier's HR department.
Why it's wrong here
The internal size of a supplier's HR department is not a standard metric for measuring supply chain risk. It does not provide actionable insight into the supplier's financial health, operational capabilities, or compliance posture, which are the core components of a reliable and meaningful supplier risk assessment framework.
- ✓
Supplier performance history and scorecards.
Why this is correct
Performance scorecards provide internal visibility into how well a supplier meets delivery, quality, and service requirements. Poor historical performance is a key indicator of operational risk, suggesting that the supplier may struggle to meet future demands, which is a major factor in the overall supplier risk assessment.
- ✓
The commodity, region, and department classification (CRD).
Why this is correct
The CRD classification is essential because it sets the context for risk. A supplier in a high-risk region or providing critical, high-complexity commodities will inherently have a different risk profile than others. This context allows the system to apply relevant risk checks and monitoring strategies tailored to the vendor.
- ✗
The length of the contract terms.
Why it's wrong here
While contract length impacts business planning, it is not a primary risk indicator for the supplier's overall health or compliance. Long-term contracts can actually be a sign of stability, so using them as a risk factor would be counter-intuitive without additional supporting data regarding the supplier's performance.
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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 SAP exam blueprint
This C_ARSUM practice question is part of Courseiva's free SAP 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 C_ARSUM exam.