CPP 2022 Domain 2 Business Principles and Practices Flashcards
What are the three standard financial reports?
Income statement,
Balance sheet,
Cash flow statement.
Source: POA, Business Principles, 12.1.1, page 362
What does an income statement show?
Revenue,
Expenses,
Net income over a defined period.
Source: POA, Business Principles, 12.1.1, page 368
What is the underlying equation of the balance sheet?
Assets = Liabilities + Equity.
Source: POA, Business Principles, 12.1.1, page 370
What does a balance sheet show?
The company’s total assets, and how the assets are financed - through debt or equity.
Source: POA, Business Principles, 12.1.1, page 370
What does a cash flow statement show?
How cash inflows and outflows affect an organization.
Source: POA, Business Principles, 12.1.1, page 371
What three elements are depicted in a cash flow statement?
Operating activities,
Investing activities,
Financing activities.
Source: POA, Business Principles, 12.1.1, page 371
What is return on assets (ROA)?
How good the company is at turning its investments into profit.
ROA = Net income before taxes/total assets
Source: POA, Business Principles, 12.3.2, page 378
What is return on investments (ROI)?
A performance measure used to evaluate the efficiency of an investment of compare the efficiency of a number of investments.
ROI= current value of an investment - cost of the investment /
cost of the investment
Source: POA, Business Principles, 12.3.2, pages 378-379
What are the three ways to measure profit margins?
Gross profit margin = gross profit/sales
Operating margin = operating income/sales
Net profit margin = net income/sales
Source: POA, Business Principles, 12.3.2, pages 376-378
What is EBITDA?
Earnings before interest, taxes, depreciation, and amortization. It is a measure of a company’s overall financial performance and is used as an alternative to net income in some circumstances.
EBITDA= net income (net earnings) + interest + taxes + depreciation +amortization
Source: POA, Business Principles, 12.3.2, page 384
What is the current ratio?
The current ratio is a measure of a company’s ability to cover short-term obligations.
Current ratio = current assets/current liabilities
Source: POA, Business Principles, 12.3.2, pages 380-381
How is a hurdle rate used?
It is a minimum rate of return on a project or investment required by a company and used to evaluate investments.
Source: POA, Business Principles, 12.3.2, page 380
What is the debt to equity ratio?
The debt to equity ratio is a measure of the degree to which a company is financing its operations through debt versus wholly-owned funds.
Debt to equity ratio = total liabilities/shareholder equity.
Source: POA, Business Principles, 12.3.2, page 382
What is zero-based budgeting?
A method of budgeting in which all expenses must be justified and approved for each new period.
Source: POA, Business Principles, 12.1.1, page 366
What is a traditional budgeting process?
In this form of budgeting, the budget of the previous year serves as the base for the creation of the next year’s budget by making adjustments to the budget of the past year.
Source: POA, Business Principles, 12.1.1, page 364
Building an execution-capable organization depends on what three tasks?
Staffing the organization;
Acquiring, developing, and strengthening the resources and capabilities required for good strategy execution;
Structuring the organization and work effort.
Source: POA, Business Principles, 9.2, pages 275-276
What is a standard?
A set of criteria, guidelines, and best practices that can be used to enhance the quality and reliability of products, services, or processes.
Source: POA, Security Management, Appendix, page 209
Who should be involved in developing a standard?
A broad group of stakeholders and interested parties both from the private and public sectors, working collaboratively.
Source: POA, Security Management, Appendix, page 209
What are three categories of standards?
Voluntary,
Statutory or regulatory,
Mixed.
Source: POA, Security Management, Appendix, pages 209-210
What is the purpose of a management system standard?
To help organizations improve the ways in which they provide services and perform processes.
Source: POA, Security Management, Appendix, page 211
What is the operating principle of many management systems standards?
The Plan-Do-Check-Act cycle.
Source: POA, Security Management, Appendix, page 211
What is ethics?
A discipline or system of moral principles governing human action and interactions. It deals with the rightness or wrongness of actions and the goodness or badness of motives and ends.
Source: POA, Security Management, 6.1.1, page 95
What are three questions that can be asked as a test for ethical conduct?
Is it legal?
Is it balanced?
How will it make me feel about myself?
Source: POA, Security Management, 6.1.1, page 95
What are three types of ethics?
Descriptive,
Analytical,
Applied.
Source: POA, Security Management, 6.1.1, page 96
What are three reasons people make unethical choices?
Convenience,
Winning,
Relativism,
Source: POA, Security Management, 6.1.5, page 99
What is the relationship between a code of ethics and an ethics program?
A code of ethics states the underlying principles and an ethics program provides the guidance and structure for compliance.
Source: POA, Security Management, 6.1.8, page 102
What is generally contained in an ethics code?
Statement from the chief executive describing and supporting the purporse and importance of the code;
Statement of the specific nature of the business;
Enumeration of organizational values, including references to employees, customers, shareholders or stakeholders, partners, and society and the community;
Statement of commitment to the code, including implementation, training, and oversight.
Source: POA, Security Management, 6.1.8, pages 102-103
What are the five basic functions of management?
Planning,
Organizing,
Directing, Staffing Coordinating, Reporting Budgeting.
Source: POA, Business Principles, 1.4, pages 9-10
What are three categories of skills expected of managers?
Technical,
Interpersonal,
Conceptual.
Source: POA, Business Principles, 1.4, page 11
How does the mix of skills change at different management levels?
Lower-level management should have stronger technical skills. The more upward in the management levels, the business requires more and better interpersonal and conceptual skills.
Source: POA, Business Principles, 1.4, page 11
What are five behavioral theories that help managers engage and motivate their staff?
Abraham Maslow’s hierarchy of needs,
Douglas McGregor’s theory X and Y,
Frederick Herzberg’s hygiene theory,
Chris Argyris’ theory on mental health,
Warren Bennis’ organizational theory.
Source: POA, Personnel, 1.14.2, pages 45-47
This behavioral theory states that people are motivated differently depending on where they stand in a hierarchy beginning with the most basic needs (such as food and shelter) and up to self-actualization.
Abraham Maslow.
Source: POA, Personnel, 1.14.2, page 46
This behavioral theory explains two assumptions on how supervisors view subordinates - as naturally lazy and avoiding responsibility; or self-directed, motivated, and creative
Douglas McGregor.
Source: POA, Personnel, 1.14.2, page 46
This behavioral theory is a two-dimensional model that involves maintenance factors and satisfiers or motivators. The theory states that managers should work top provide a proper balance between the maintenance factors and the motivators.
Frederick Herzberg.
Source: POA, Personnel, 1.14.2, page 46
This behavioral theory states that traditional organizational principles, structures, and procedures are incompatible with the mental health of employees.
Chris Argyris.
Source: POA, Personnel, 1.14.2, page 46
This behavioral theory suggests future organizations will exhibit characteristics such as integration, social influence, collaboration, adaptation, and revitalization.
Warren Bennis.
Source: POA, Personnel, 1.14.2, page 46
What are the components of the Big Five Model of Personality?
Surgency (leadership and extroversion),
Agreeableness,
Adjustment,
Conscientiousness,
Openness to experience.
Source: POA, Personnel, 1.14.3, page 52
What are the three domains of learning?
Cognitive,
Affective,
Psychomotor.
Source: POA, Personnel, 2.1.1, pages 71-72
This learning domain includes the amount of material that is learned and the theory relating to the material (being able to grasp the theory and applying it in practice).
Cognitive learning.
Source: POA, Personnel, 2.1.1, page 71
This learning domain changes how a person views a situation.
Affective learning.
Source: POA, Personnel, 2.1.1, page 71
This learning domain is the physical or hands-on aspect of learning.
Psychomotor learning.
Source: POA, Personnel, 2.1.1, page 72
What are six benefits of training?
Improved job performance,
Ease of supervision,
Procedure review,
Staff motivation,
Reduced turnover,
Legal protection.
Source: POA, Personnel, 2.2, pages 74-76
What is cost of goods sold?
How much an organization paid to sell products during a given period.
Source: POA, Business Principles, 12.3.2, page 376
What factors determine the number of officers required for a facility?
Level of risk,
Physical complexity and size of the facility,
Number of employees,
Nature of work,
Number of entrances and the hours they are open,
Value and amount of assets being protected,
Number of patrols needed,
Number of escorts and special assignments needed.
Source: POA, Personnel, 1.1.1, pages 2-3
What are the three elements of an officer’s personal development?
Education,
Training,
Guided experience.
Source: POA, Personnel, 2.1.3, page 72
What are the six major benefits of officer training?
Improved job performance,
Ease of supervision,
Procedure review,
Staff motivation,
Reduced turnover,
Legal protection.
Source: POA, Personnel, 2.2, page 74
What are Knowles’s principles of andragogy?
A theory of adult learning that assumes adults are self-directed and will take responsibility for their own learning needs.
Source: POA, Personnel, 2.4, page 78
What should be considered when selecting a training method?
Scheduling,
Available technologies,
Comfort level of the instructor,
Number of persons to receive the training.
Source: POA, Personnel, 2.5, page 80
What are six training methodologies?
Lectures,
Case studies,
Job aids,
Distance learning,
On-the-job training,
Mentoring.
Source: POA, Personnel, 2.5, pages 80-82
When is the case study method of training most effective?
When students work together in groups and actively have discussions.
Source: POA, Personnel, 2.5.2, page 81
In most security environments, what type of training methodology works best?
Mentoring.
Source: POA, Personnel, 2.5.6, page 82
What are seven ways to overcome limiting training budgets?
Use off the shelf programs,
Outsource training to a community college or technical institution, Look for grant funding,
Join professional organizations such as ASIS,
Share instructional materials,
Use distance learning,
Call on in-house trainers.
Source: POA, Personnel, 2.7.1, pages 83-84
What options should be considered for distance education or self-teaching?
Pass-along media,
Online learning programs,
Written procedures,
Pass-along logs,
Distance learning,
Certifications
Source: POA, Personnel, 2.7.2, pages 84-85
What are some types of training strategies that can be used to make training programs more cost-effective?
Off-duty training,
Tuition reimbursement,
Recognition programs, Selling security services, Supervisory training, Internships, Previous experience, Officer selection, Job rotation, Professional memberships.
Source: POA, Personnel, 2.8, page 87
What are three common approaches to capability building?
Developing and strengthening capabilities internally,
Acquiring capabilities through mergers and acquisitions,
Developing new capabilities through collaborative partnerships.
Source: POA, Business Principles, 9.4.1, page 281
What is an organizational structure?
The formal and informal arrangement of tasks, responsibilities, lines of authority, reporting relationships, and processes of communication by which the firm is administered.
Source: POA, Business Principles, 9.5.2, page 289
What factors contribute to how an organizational chart is structured?
Prior organizational patterns,
Varying internal circumstances,
Executive judgments about reporting relationships,
Politics of who gets which assignments.
Source: POA, Business Principles, 9.5, page 287
What can affect vigilant performance?
Work area design,
Human engineering of the tasks and equipment,
Human visual and auditory acuity, Human detection, identification, and recognition capabilities, Job analysis, Training, Workplace environment, Quality control, Morale, Management advocacy for security staff.
Source: POA, Personnel, 1.14.1, pages 42-43
What is a job analysis?
The systematic collection and recording of information about the purpose of a job, its major duties, the conditions under which it is performed, required contacts with others, and the knowledge, skills, and abilities needed to perform the job effectively.
Source: POA, Personnel, 1.14.1, page 42
What are three work environments in which security officers work?
Mechanical environment,
Physical environment,
Human environment.
Source: POA, Personnel, 1.14.3, pages 47-51
This work environment includes security and systems equipment such as video surveillance, access control, and life safety systems.
Mechanical environment.
Source: POA, Personnel, 1.14.3, page 47
This work environment includes factors such as prolonged periods of standing or sitting.
Physical environment.
Source: POA, Personnel, 1.14.3, pages 47-50
This work environment includes job knowledge, proficiency, and personality traits.
Human environment.
Source: POA, Personnel, 1.14.3, page 51
What characteristics contribute to a security officer’s success on the job?
Character,
Behavior and communications,
Coachability, Appearance, Knowledge of the job, Education, Ethics.
Source: POA, Personnel, 1.3.2, pages 10-11
What are two common models for structuring a security operation?
Vertical,
Network.
Source: POA, Personnel, 1.7, page 20
In this security operation structure, authority comes from the top and flows down through a series of managers and supervisors until it stops with the front-line staff.
Vertical.
Source: POA, Personnel, 1.7.1, page 20
In this security operation structure, employees are connected not just to their immediate supervisor and to those whom they themselves supervise, but also to many others in the organization.
Network.
Source: POA, Personnel, 1.7.2, page 21
What is the necessary human being concept?
The concept means that the particular characteristics and reactions required at the security post require human capabilities.
Source: POA, Personnel, 1.9.1, page 26
What are three broad criteria for choosing a security officer contractor?
Consistent performance,
Prompt, efficient, and positive response to client concerns,
Competitive pricing.
Source: POA, Personnel, 3.1.1, pages 102-103
What should be stated in the scope of work in a security officer RFP?
The security tasks,
Days and hours of performance,
Total number of hours to be worked.
Source: POA, Personnel, 3.1.2, page 107
What are three types of service environments?
Public areas,
Semi-public areas,
Private facilities and property.
Source: POA, Personnel, Chapter 3 Introduction, page 101
In this service environment, officers deal with people and activities in areas or buildings with unrestricted access.
Public.
Source: POA, Personnel, Chapter 3 Introduction, page 101
Sites in this type of service environment may have some form of access restriction or impose and entry fee.
Semi-public.
Source: POA, Personnel, Chapter 3 Introduction, page 101
Areas or facilities in this service environment limit entry to certain people.
Private.
Source: POA, Personnel, Chapter 3 Introduction, page 101
What are some criteria that should be used to evaluate a security services bid?
Adherence to the deadline,
Spelling, grammar, and accuracy in response,
Customized vs. template,
Inclusion of all requested details,
Quality of the proposal package.
Source: POA, Personnel, 3.3.1, page 111
