Hi

The passage does not state that Flyna only uses lumber from mills certified in the last one year. From the information given in the passage, it is a reasonable inference that once certified, Flyna continues to source lumber from that mill till it is de-certified. Given that Flyna only inspects 10% of X's mills in a year, assuming truly randomized selection, each mill should be inspected only on average every ten years or so. So Flyna may be sourcing lumber from a mill which was certified 10 years (or even more) ago. This throws Flyna's claims of sourcing only legally lumbered wood into doubt.

Hope this clarifies.
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From what's in the passage, we don't need to infer the Flyna would not use wood from uncertified mills -- we're told that in the sentence that says:

"Flyna uses only lumber from certified mills"

Flyna will only use wood from certified mills BUT how reliable is the certification? That is the part of the argument that (D) works to undermine. (D) tells us:

If only 10% of Country X's lumber mills are inspected each year -- and we know that illegal logging is a problem in Country X. Then how do we know the wood from the other 90% of the mills does not have any association with the illegal loggers?

Similarly, there's nothing to say that a mill that has a certification must have been inspected. Flyna might have given out the certification to mills with the intention of inspecting them in the coming years. We don't know that a certified mill has been inspected this year, last year, or in any year.

There could be several mills that hold the certification but use wood obtained by illegal logging. These mills are just hoping they're not in the 10% randomly selected for inspection that year.

Flyna has created a certification system but may not be inspecting enough mills to ensure its certification scheme does the job it's supposed to. Using this information, we cannot be certain that these mills are supplying legally sourced lumber. Therefore, we cannot verify Flyna's claim that its Country X wood is obtained legally.

This is how (D) undermines the justification provided for Flyna's claim and is why (D) is the answer to this question.

I hope that helps!
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Stockholders have been critical of the Flyna Company, a major furniture retailer, because most of Flyna’s furniture is manufactured in Country X from local wood, and illegal logging is widespread there. However, Flyna has set up a certification scheme for lumber mills. It has hired a staff of auditors and forestry professionals who review documentation of the wood supply of Country X’s lumber mills to ensure its legal origin, make surprise visits to mills to verify documents, and certify mills as approved sources of legally obtained lumber. Flyna uses only lumber from certified mills. Thus, Flyna’s claim that its Country X wood supply is obtained legally is justified.

P : Stockholders are critical to Flyna Company, producing furniture in Country X, where illegal logging is widespread.
P : For certification, Flyna hires auditors and forestry professionals.
P : Flyna uses only certified mills.
C : Flyna's obtained wood is legal.

Hiring auditors and forest professionals means legally obatined wood?

Which of the following, if true, would most undermine the justification provided for Flyna’s claim?

A. Only about one-third of Flyna’s inspectors were hired from outside the company.
-> Irrelevant. No specific statement has been made within relationship between hiring inspectors outside the company and inside the company. No certain evidence is given to aussme that because two-third of inspectors are hired inside the company, most of them will be injustice.

B. Country X’s government recently reduced its subsidies for lumber production.
-> Government's subsidies and legal justification has no relationship in this argument.

C. Flyna has had to pay higher than expected salaries to attract qualified inspectors.
-> Irrelevant. How much Flyna has to pay has nothing to do with the legal right of the woods the company obtain.

D. The proportion of Country X’s lumber mills inspected each year by Flyna’s staff is about 10 percent, randomly selected.
-> Correct. This option implies since only 10% of mills are inspected, we can still have question to 90% of other mills that are not inspected. Legal right of the woods obtained in those 90% of mills is not know.

E. Illegal logging costs Country X’s government a significant amount in lost revenue each year.
-> Irrelevant. Country X might have some motivation to support legal logging to companies. However, this fact has nothing to do with the legal right of