CPFO COMPENSATION BENEFITS EXAM
SCRIPT VERIFIED QUESTIONS WITH FULL
SOLUTION
●● Monetary Compensation
Answer: Includes any costs the organization incurs for the benefit of
employees, such as all forms of cash compensation, 401(k) matching,
medical care premiums, pension plans, and paid time off. Other kinds of
rewards include benefits that support the organization's culture such as
stock options, Employee Stock Ownership Programs (ESOPs), and
incentive plans.
●● Intrinsic Reward
Answer: A reward that encourages individual employee self esteem,
such as satisfaction from challenging and exciting assignments.
●● Extrinsic Reward
Answer: A reward in which esteem is achieved from others, such as
fulfillment from working with a talented team of peers.
●● Nonmonetary Rewards
Answer: Include nontraditional work-life balance benefits such as
telecommuting, on-site childcare, and flex time.
, ●● Direct Compensation
Answer: Includes payments made to employees that are associated with
wages and salaries. This includes pay, variable compensation, and pay
for performance.
●● Indirect Compensation
Answer: Consists of any employee payments not associated with wages
and salaries. This includes fringe benefits such as vacation, sick, and
holiday pay; insurance premiums paid on behalf of employees; leaves of
absence; 401(k) or other pension plans, and government-mandated
benefits such as Social Security or FMLA, or other benefits.
●● Total Rewards Philosophy
Answer: A high-level mission statement used to guide the development
and implementation of compensation and benefit programs that attract,
motivate, and retain employees.
●● What is the challenge in developing a compensation philosophy?
Answer: Balancing the diverse conditions faced by the organization as a
whole in a way that is consistent with the organizational culture.
●● Internal Conditions (affecting compensation philosophy)
Answer: Affect an organization's willingness and ability to pay.
Examples include financial constraints, or poor business results prevent
an organization from following through with a generous bonus program.
SCRIPT VERIFIED QUESTIONS WITH FULL
SOLUTION
●● Monetary Compensation
Answer: Includes any costs the organization incurs for the benefit of
employees, such as all forms of cash compensation, 401(k) matching,
medical care premiums, pension plans, and paid time off. Other kinds of
rewards include benefits that support the organization's culture such as
stock options, Employee Stock Ownership Programs (ESOPs), and
incentive plans.
●● Intrinsic Reward
Answer: A reward that encourages individual employee self esteem,
such as satisfaction from challenging and exciting assignments.
●● Extrinsic Reward
Answer: A reward in which esteem is achieved from others, such as
fulfillment from working with a talented team of peers.
●● Nonmonetary Rewards
Answer: Include nontraditional work-life balance benefits such as
telecommuting, on-site childcare, and flex time.
, ●● Direct Compensation
Answer: Includes payments made to employees that are associated with
wages and salaries. This includes pay, variable compensation, and pay
for performance.
●● Indirect Compensation
Answer: Consists of any employee payments not associated with wages
and salaries. This includes fringe benefits such as vacation, sick, and
holiday pay; insurance premiums paid on behalf of employees; leaves of
absence; 401(k) or other pension plans, and government-mandated
benefits such as Social Security or FMLA, or other benefits.
●● Total Rewards Philosophy
Answer: A high-level mission statement used to guide the development
and implementation of compensation and benefit programs that attract,
motivate, and retain employees.
●● What is the challenge in developing a compensation philosophy?
Answer: Balancing the diverse conditions faced by the organization as a
whole in a way that is consistent with the organizational culture.
●● Internal Conditions (affecting compensation philosophy)
Answer: Affect an organization's willingness and ability to pay.
Examples include financial constraints, or poor business results prevent
an organization from following through with a generous bonus program.
