CPFA LICENSE CERTIFICATION REVIEW
SET 2026 ANSWERS GUARANTEED PASS
⫸ The advisor should educate the Answer: plan sponsor about hiring
fiduciary service providers, including the different roles service
providers, including the different roles service providers may take on
within the plan, how to select a qualified candidate, and the plan
sponsor's ongoing responsibility to monitor them.
⫸ The fiduciary definition has two parts: Answer: who is a fiduciary
to what extent the person is a fiduciary
Clarifying fiduciary status is arguably incomplete without addressing
both.
⫸ A best practice for a service provider's formal description of services
might therefore include two parts: Answer: a. an acknowledgment of
fiduciary status
b. clarification as to the extent of responsibilities
⫸ As a non-fiduciary advisor, you can Answer: educate your client and
present possible investments for the Retirement Plan Committee
consideration.
,⫸ If you recommend a specific fund replacement to the plan sponsor or
plan participants, you are considered to be Answer: giving investment
advice and are therefore a functional fiduciary to the plan.
⫸ If fiduciaries of participants use your recommendations - as opposed
to information - to make investment decisions, this could be considered
Answer: a fiduciary act
⫸ As a non-fiduciary advisor, you can meet with your client on a
recurring basis (quarterly, annually, etc) if providing Answer: general
investment reports or discussing the appropriateness of the investments
to the plan without making specific investment suggestions.
⫸ Plan fiduciaries will almost always have to hire Answer: service
providers for their plan under their ERISA "duty to obtain expert
assistance."
⫸ As a best practice, the advisor can help fiduciaries select: Answer: the
service providers, which usually includes a TPA and a record keeper.
⫸ In owner driven smaller plans, the advisor can assist the Answer: plan
sponsor's HR staff - which is likely to be one person in working with the
various plan service providers.
⫸ In larger participant driven plans, the advisor can work with Answer:
the HR director, CFO, and the retirement plan committee to evaluate
service providers.
, ⫸ A 3(21) fiduciary does not serve as a fiduciary investment manager,
but instead usually as Answer: investment advice fiduciary
⫸ f your client wants an advisor to manager plan investments, or just
the QDIA, they can hire a Answer: 3(38) fiduciary advisor.
⫸ A 3(21) fiduciary advisors can recommend investments but the final
decision on which investments to choose is up to the Answer: plan
fiduciaries.
⫸ A 3(16) plan administrator can take on administrative duties for the
plan but does not act in Answer: an investment capacity.
⫸ A non-fiduciary advisors can provide Answer: education
⫸ The DOL is not required to be notified if Answer: the plan hires a
3(21) advisor.
⫸ The fiduciaries should do a review of the service provider
qualifications in order to prove a Answer: prudent process was not
followed when selecting the service provider. They should also review
the service agreement, document the decision process, and have a
service agreement with the 3(21) advisor.
SET 2026 ANSWERS GUARANTEED PASS
⫸ The advisor should educate the Answer: plan sponsor about hiring
fiduciary service providers, including the different roles service
providers, including the different roles service providers may take on
within the plan, how to select a qualified candidate, and the plan
sponsor's ongoing responsibility to monitor them.
⫸ The fiduciary definition has two parts: Answer: who is a fiduciary
to what extent the person is a fiduciary
Clarifying fiduciary status is arguably incomplete without addressing
both.
⫸ A best practice for a service provider's formal description of services
might therefore include two parts: Answer: a. an acknowledgment of
fiduciary status
b. clarification as to the extent of responsibilities
⫸ As a non-fiduciary advisor, you can Answer: educate your client and
present possible investments for the Retirement Plan Committee
consideration.
,⫸ If you recommend a specific fund replacement to the plan sponsor or
plan participants, you are considered to be Answer: giving investment
advice and are therefore a functional fiduciary to the plan.
⫸ If fiduciaries of participants use your recommendations - as opposed
to information - to make investment decisions, this could be considered
Answer: a fiduciary act
⫸ As a non-fiduciary advisor, you can meet with your client on a
recurring basis (quarterly, annually, etc) if providing Answer: general
investment reports or discussing the appropriateness of the investments
to the plan without making specific investment suggestions.
⫸ Plan fiduciaries will almost always have to hire Answer: service
providers for their plan under their ERISA "duty to obtain expert
assistance."
⫸ As a best practice, the advisor can help fiduciaries select: Answer: the
service providers, which usually includes a TPA and a record keeper.
⫸ In owner driven smaller plans, the advisor can assist the Answer: plan
sponsor's HR staff - which is likely to be one person in working with the
various plan service providers.
⫸ In larger participant driven plans, the advisor can work with Answer:
the HR director, CFO, and the retirement plan committee to evaluate
service providers.
, ⫸ A 3(21) fiduciary does not serve as a fiduciary investment manager,
but instead usually as Answer: investment advice fiduciary
⫸ f your client wants an advisor to manager plan investments, or just
the QDIA, they can hire a Answer: 3(38) fiduciary advisor.
⫸ A 3(21) fiduciary advisors can recommend investments but the final
decision on which investments to choose is up to the Answer: plan
fiduciaries.
⫸ A 3(16) plan administrator can take on administrative duties for the
plan but does not act in Answer: an investment capacity.
⫸ A non-fiduciary advisors can provide Answer: education
⫸ The DOL is not required to be notified if Answer: the plan hires a
3(21) advisor.
⫸ The fiduciaries should do a review of the service provider
qualifications in order to prove a Answer: prudent process was not
followed when selecting the service provider. They should also review
the service agreement, document the decision process, and have a
service agreement with the 3(21) advisor.
