CPFA EXAM QUESTIONS AND
ANSWERS RATED A.
Question : ERISA requires that fiduciaries manage the
plan for the exclusive benefit of which of the following parties?
Correct answer: participants and their beneficiaries
Question : June is a Plan Sponsor of a small plan and
decided she'll be acting as the sole fiduciary of the plan.All of the following are her responsibilities except?
Correct answer: Give investment advice to participants
Question : Under ERISA, the Plan Admin has the
following roles, except?
Correct answer: Redesigning the plan's employer
matching contribution formula
Question : Under ERISA, all of the following are Plan
Trustee responsibilities, except?
Correct answer: Oversee the plan administrator
Question : All of the following may be named fiduciaries
in a plan document, except?
Correct answer: Legal counsel who prepares the plan
document
Question : Sue is a plan advisor for the ABC retirement
plan. On the agenda for the upcoming ABC plan Committee meeting is an action item to replace Len and nominate a new member to the committee. Len has been asked to leave the committee due to his unsatisfactory attendance at monthly meetings. All of the following are best practices regarding fiduciary changes, except?
Correct answer: Per Len's request, the Committee
minutes will exclude the reason Len was asked to leave the committee.
Question : Sharon is a 3(21) advisor. She is meeting with
a potential client and is preparing for her meeting. All of the following are services that Sharon may offer the prospect, except?
Correct answer: Make decisions to replace funds on the
watch list pursuant to the investment policy statement, prior to attending the investment committee meeting.
Question : All of the following represent potential
breaches of fiduciary responsibility by plan fiduciaries, except?
Correct answer: A plan trustee delegates some of his
responsibilities to a discretionary trustee who he continues to monitor.
Question : All of the following statements represent the
DOL's role in overseeing plans, except?
Correct answer: A DOL investigation letter will usually
ask for no more than five items related to the plan's operation.
Question : Which statement regarding the IRS and the
DOL corrections programs is true?
Correct answer: The DOL website includes an online
calculator that calculates earnings earnings amounts to be paid to the plan.
Question : All of the following statements describe
characteristics of ERISA fidelity bonds and fiduciary insurance, except?
Correct answer: An ERISA fidelity bond protects the
employee from any error made when submitting contributions to a service provider.
Question : Larry is the owner of DEF company. Which
of Larry's activities is considered a fiduciary function?
Correct answer: Hires the plans investment advisor.
Question : All of the following documents should be
maintained to show fiduciary best practices, except?
Correct answer: Documentation of selection process for
new payroll vendor.
Question : All of the following documents are updated
annually, except?
Correct answer: Plan Document
Question : All of the following are consequences of
fiduciary breaches except?
Correct answer: The corporate veil protects fiduciaries
from personal liability
Question : All of the following are best practices for
determining the reasonableness of plan fees, except?
Correct answer: Owner driven plans are not required to
determine the reasonableness of plan fee due to their limited personnel and financial resources.
Question : All of the following fees may be paid from
the plan, except?
Correct answer: Fee associated with union negotiations
regarding retirement plan benefits.
Question : All of the following are parties-in-interest to
the STU, inc. profit sharing plan, except?