A portfolio governance board has established key performance indicators (KPIs) for portfolio performance. After several quarters, they notice that the KPIs are not providing useful insights for decision-making. The board wants to improve the KPI set. What is the most appropriate action?

Review the KPIs against the strategic objectives and revise them to better measure what matters.

Replace the KPIs with financial metrics only, such as ROI and payback period.

Add more KPIs to capture every possible aspect of performance.

Keep the KPIs unchanged to maintain consistency over time.

A portfolio manager notices that several projects are consistently exceeding their budgets. The governance framework includes a policy that requires corrective action when a project's cost variance exceeds a defined threshold. What should the portfolio manager do first?

Escalate the variance to the portfolio review board with an analysis of the cause and recommended options.

Immediately terminate the projects that are over budget.

Ignore the variance until the next annual review.

Adjust the governance policy to increase the threshold so the variance is no longer an issue.

What is the typical first step in the governance decision-making process for selecting portfolio components?

Allocating resources to all proposed components equally

Immediately approving all proposed components

Deferring all decisions to the project managers

Evaluating proposed components against defined criteria

A portfolio governance board has been operating for two years. The board wants to assess whether its governance processes are effective and identify areas for improvement. What is the most appropriate method?

Review the governance policies to ensure they are up to date.

Ask the board members to self-assess their performance in a meeting.

Conduct a formal review of governance processes, including surveys and interviews with stakeholders, and benchmark against industry practices.

Compare the number of projects completed on time and on budget to industry averages.

What is the purpose of an escalation path in portfolio governance?

To hide issues from stakeholders

To ensure that issues are raised to the appropriate level of authority for resolution

PMIPortfolio Management Professional (PfMP)

Domain 2Objective 1

Task 1 PFMP Practice Questions (Page 4)

Part of the Governance domain, which accounts for 20% of the PFMP exam. PMI does not publish an official question count, but from its 240-minute exam (~95–160 total, ~19–32 in this domain), expect 4–6 from this objective — we provide 34 practice questions to prepare you well beyond it. (estimate)

34questions here

7free pages

9concepts

20%of the exam

Questions 16–20

16expert · hard
A portfolio governance board has established key performance indicators (KPIs) for portfolio performance. After several quarters, they notice that the KPIs are not providing useful insights for decision-making. The board wants to improve the KPI set. What is the most appropriate action?
Select an answer first
17application · medium
A portfolio manager notices that several projects are consistently exceeding their budgets. The governance framework includes a policy that requires corrective action when a project's cost variance exceeds a defined threshold. What should the portfolio manager do first?
Select an answer first
18foundation · easy
What is the typical first step in the governance decision-making process for selecting portfolio components?
Select an answer first
19expert · hard
A portfolio governance board has been operating for two years. The board wants to assess whether its governance processes are effective and identify areas for improvement. What is the most appropriate method?
Select an answer first
20foundation · easy
What is the purpose of an escalation path in portfolio governance?
Select an answer first

Finished these 5 questions?

Review the revealed explanations, or continue through the curriculum.

Next 5 questions →Back to PFMP

Free Basic Practice is a study aid with revealable answers — not a scored exam. Examers.io is independent and not affiliated with or endorsed by PMI. “PFMP” is a trademark of its owner, used for identification only.