CPFA ACTUAL EXAM QUE STIONS

CPFA ACTUAL EXAM QUE STIONS

WITH CORRECT ANSWERS

COMPLETE GUIDE RATED AND

GRADED A.

Question : What entity keeps track of participant

accounts?

• Plan Trustee
• Custodian
• Advisor
• ERISA Counsel
• Recordkeeper

Correct answer: E) Recordkeeper

Question : Which statements are true regarding prudent

process when selecting service providers?

• Fiduciaries should follow DOL Service provider

selection regulations

• RFPs and formal search processes are part of a best

practice for participant-driven plans

• Owner-driven plans use a less formal solicitation of

proposals but they still should have a service provider search process as best practice

• ERISA litigation does not address service provider

selection, so it does not need to be taken into account in the selection process

• Reviewing fees is part of vendor oversight but not

vendor selection

Correct answer: B and C

Question : Which statement is TRUE?

• A TPA performs annual compliance testing
• A recordkeeper has the legal obligation to provide an

interpretation of a plan provision

• An accountant processes the "money out" for a

participant withdrawal

• A plan advisor is responsible for drafting annual safe

harbor notices

Correct answer: A

Question : All of the following are important factors

when selecting a service provider, EXCEPT:

• Service provider's financial stability
• Experience with plans of similar size and complexity
• Willingness to provide revenue sharing to offset plan

fees

• Qualifications of personnel that will service plan

Correct answer: C

Question : Which statement regarding bundled service

arrangements is TRUE?

• Provides efficient contribution and distribution

processes

• Requires less fiduciary oversight than an unbundles

service arrangement

• Permits for a specific single provider within the

arrangement to be easily removed and replaced with another provider

• Typical arrangement involves a TPA and an

insurance company

Correct answer: A

Question : Based on behavioral finance research, which

of the following is a best practice for producing successful participant outcomes?

• Combining auto-enrollment with targeted education
• Adding a self-directed brokerage option
• Re-enrolling all participants into equity investments
• Offering group meetings that focus on participants'

rational decision making

Correct answer: A

Question : All of the following are benefits of participant

retirement readiness, EXCEPT:

• Employers can better manage their workforce needs

• Participants receive a guarantee of lifetime income

payments

• Employees may be more satisfied with their jobs

when working for an employer that actively promotes retirement readiness programs

• Employers can work with service providers who have

tools to assist participants in increasing retirement savings

Correct answer: B

Question : All of the following are items to consider

when developing a strategy to promote successful

participant outcomes, EXCEPT:

• What is the average life expectancy for the

participants beneficiaries?

• Should investment advice be offered?
• Is senior level management interested in promoting

"Retirement readiness"?

• What type of participant education should be

provided?

Correct answer: A

Question : Which statement regarding IRA plans and

401(k) plans is TRUE?

• SIMPLE IRA plans are used to maximize plan

benefits to owners