CPFO COMPENSATION BENEFITS EXAM
SCRIPT 2026 COMPLETE QUESTIONS AND
CORRECT ANSWERS GRADED A+
●● Key component of position control.
Answer: -Vacancy adjustments, inflation impacts, and compensation
approaches are all key components of and effective budgeting of salary
and wages.
●● Budgeting of salary and wages.
Answer: -Salaries and wages are largest portion of expenditure budget.
-Need for accurate expenditure projections
-Manage headcount levels in light of cost constraints
●● Collective bargaining and compensation.
Answer: -Track positions covered by collective bargaining agreements.
-Be aware of key dates
-More than salary, some agreements address overtime, holiday pay, shift
differentials, uniform allowances, and license/certification pay.
●● Employer compensation costs landscape (Private vs. Public).
Answer: Employer costs are higher per hour in public sector than in
private.
,●● FICA.
Answer: Federal Insurance Contribution Act - A US federal payroll tax
that is deducted from each paycheck.
Social Security and Medicare
●● Fringe benefit.
Answer: Any financial extras beyond the regular pay - retiree health
insurance, retiree pension, company car, subsidized meals, bonuses.
Tuition reimbursement is no considered de minimis.
Limit before taxable is $5,250
●● Longevity of service.
Answer: Length of service
●● Employer-provided tuition assistance.
Answer: -Full or partial reimbursement or loan.
-Policy must be tax compliant.
-Consider some type of repayment if employee terminates
-Not considered de minimis fringe benefit.
●● Paid Time Off (PTO).
, Answer: -Set number of days to be used by employee for time off, either
sick or vacation.
-Discourages people from accruing significant sick leave banks.
●● Merit pay model.
Answer: -Pay for performance system
●● Portable retirement plan.
Answer: -Defined contribution plan
-Retirement plan benefit is attached to the individual employee and not
the employer.
●● FSLA Non-discretionary bonus.
Answer: -Included in the regular rate of pay, unless qualified as
excludable under another statutory provision.
-Employees know about, understand how to earn, and expect the bonus.
-Employer still has the option not to pay the bonus.
●● Importance for employer to track employee time.
Answer: -Determine how much to pay
-Determine leave time accrual and deductions
-Promote a culture of accountability
-Time entry options:
SCRIPT 2026 COMPLETE QUESTIONS AND
CORRECT ANSWERS GRADED A+
●● Key component of position control.
Answer: -Vacancy adjustments, inflation impacts, and compensation
approaches are all key components of and effective budgeting of salary
and wages.
●● Budgeting of salary and wages.
Answer: -Salaries and wages are largest portion of expenditure budget.
-Need for accurate expenditure projections
-Manage headcount levels in light of cost constraints
●● Collective bargaining and compensation.
Answer: -Track positions covered by collective bargaining agreements.
-Be aware of key dates
-More than salary, some agreements address overtime, holiday pay, shift
differentials, uniform allowances, and license/certification pay.
●● Employer compensation costs landscape (Private vs. Public).
Answer: Employer costs are higher per hour in public sector than in
private.
,●● FICA.
Answer: Federal Insurance Contribution Act - A US federal payroll tax
that is deducted from each paycheck.
Social Security and Medicare
●● Fringe benefit.
Answer: Any financial extras beyond the regular pay - retiree health
insurance, retiree pension, company car, subsidized meals, bonuses.
Tuition reimbursement is no considered de minimis.
Limit before taxable is $5,250
●● Longevity of service.
Answer: Length of service
●● Employer-provided tuition assistance.
Answer: -Full or partial reimbursement or loan.
-Policy must be tax compliant.
-Consider some type of repayment if employee terminates
-Not considered de minimis fringe benefit.
●● Paid Time Off (PTO).
, Answer: -Set number of days to be used by employee for time off, either
sick or vacation.
-Discourages people from accruing significant sick leave banks.
●● Merit pay model.
Answer: -Pay for performance system
●● Portable retirement plan.
Answer: -Defined contribution plan
-Retirement plan benefit is attached to the individual employee and not
the employer.
●● FSLA Non-discretionary bonus.
Answer: -Included in the regular rate of pay, unless qualified as
excludable under another statutory provision.
-Employees know about, understand how to earn, and expect the bonus.
-Employer still has the option not to pay the bonus.
●● Importance for employer to track employee time.
Answer: -Determine how much to pay
-Determine leave time accrual and deductions
-Promote a culture of accountability
-Time entry options:
