CPFA Exam Question & Answers
(Latest 2025)
A) A TPA performs annual compliance testing. - CORRECT
ANSWERS ✔✔Which statement regarding service
providers is TRUE?
A) A TPA performs annual compliance testing.
B) A recordkeeper has the legal obligation to provide an
interpretation of a plan provision.
C) An accountant processes the "money out" for a
participant account.
D) A plan advisor is responsible for drafting annual safe
harbor notices.
A) Provides efficient contribution and distribution
processes. - CORRECT ANSWERS ✔✔Which
statement regarding bundled service arrangements is
TRUE?
A) Provides efficient contribution and distribution
processes.
B) Requires less fiduciary oversight than an unbundled
service arrangement.
C) Permits for specific single provider within the
arrangement to be easily removed and replaced with
another provider.
,CPFA Exam Question & Answers
(Latest 2025)
D) Typical arrangement involves a TPA and an insurance
company.
A) Combining auto-enrollment with targeted education. -
CORRECT ANSWERS ✔✔Based on behavioral finance
research, which of the following is a best practice for
producing successful participant outcomes?
A) Combining auto-enrollment with targeted education.
B) Adding a self-directed brokerage option.
C) Re-enrolling all participants into equity investments.
D) Offering group meetings that focus on participants'
rational decision making.
C) DEF has the right to "opt out" and be excluded from
the related group. - CORRECT ANSWERS
✔✔Company ABC and Company DEF are determined to
be part of a related group of companies. All the following
are TRUE except:
A) The employees of both ABC and DEF may end up
participating in one plan.
B) ABC may be required to make contributions for its
employees into DEF's plan.
,CPFA Exam Question & Answers
(Latest 2025)
C) DEF has the right to "opt out" and be excluded from
the related group.
D) If DEF adopts a plan, ABC employees may be eligible
for the plan.
A) Adding an employer matching contribution equal to
25% up to 12% of compensation deferred. - CORRECT
ANSWERS ✔✔Which of the following plan designs
may result in better participant deferral behavior?
A) Adding an employer matching contribution equal to
25% up to 12% of compensation deferred.
B) Adding a 3% nonelective safe harbor contribution.
C) Adding a 1,000 hours of service requirement to receive
the employer matching contribution.
D) Adding a profit-sharing contribution.
B) Can participants convert their existing contribution
accounts to Roth accounts? - CORRECT ANSWERS
✔✔An advisor is meeting with a Plan Sponsor to discuss
contribution design in her plan. All of the following
questions will help with this conversation, EXCEPT:
, CPFA Exam Question & Answers
(Latest 2025)
A) Is there a goal that employees should be required to
contribute to receive an employer contribution?
B) Can participants convert their existing contribution
accounts to Roth accounts?
C) Is there a group of employees who are unlikely to
participate in the plan?
D) How important is it that employees are on track for
adequate retirement income?
B) Does the company have an established line of credit? -
CORRECT ANSWERS ✔✔Jake is a sole proprietor and
has just established a software development company. He
has recently hired two employees. Currently, the
company does not have a good cash flow, but if Jake can
hire more software engineers, growth and profits should
increase. Based on that information, all of the following
are questions that an advisor should ask when
establishing a plan for Jake's company, EXCEPT:
A) Can the company's current cash flow support employer
contributions?
B) Does the company have an established line of credit?
C) What are Jake's objectives for attracting future
employees?
(Latest 2025)
A) A TPA performs annual compliance testing. - CORRECT
ANSWERS ✔✔Which statement regarding service
providers is TRUE?
A) A TPA performs annual compliance testing.
B) A recordkeeper has the legal obligation to provide an
interpretation of a plan provision.
C) An accountant processes the "money out" for a
participant account.
D) A plan advisor is responsible for drafting annual safe
harbor notices.
A) Provides efficient contribution and distribution
processes. - CORRECT ANSWERS ✔✔Which
statement regarding bundled service arrangements is
TRUE?
A) Provides efficient contribution and distribution
processes.
B) Requires less fiduciary oversight than an unbundled
service arrangement.
C) Permits for specific single provider within the
arrangement to be easily removed and replaced with
another provider.
,CPFA Exam Question & Answers
(Latest 2025)
D) Typical arrangement involves a TPA and an insurance
company.
A) Combining auto-enrollment with targeted education. -
CORRECT ANSWERS ✔✔Based on behavioral finance
research, which of the following is a best practice for
producing successful participant outcomes?
A) Combining auto-enrollment with targeted education.
B) Adding a self-directed brokerage option.
C) Re-enrolling all participants into equity investments.
D) Offering group meetings that focus on participants'
rational decision making.
C) DEF has the right to "opt out" and be excluded from
the related group. - CORRECT ANSWERS
✔✔Company ABC and Company DEF are determined to
be part of a related group of companies. All the following
are TRUE except:
A) The employees of both ABC and DEF may end up
participating in one plan.
B) ABC may be required to make contributions for its
employees into DEF's plan.
,CPFA Exam Question & Answers
(Latest 2025)
C) DEF has the right to "opt out" and be excluded from
the related group.
D) If DEF adopts a plan, ABC employees may be eligible
for the plan.
A) Adding an employer matching contribution equal to
25% up to 12% of compensation deferred. - CORRECT
ANSWERS ✔✔Which of the following plan designs
may result in better participant deferral behavior?
A) Adding an employer matching contribution equal to
25% up to 12% of compensation deferred.
B) Adding a 3% nonelective safe harbor contribution.
C) Adding a 1,000 hours of service requirement to receive
the employer matching contribution.
D) Adding a profit-sharing contribution.
B) Can participants convert their existing contribution
accounts to Roth accounts? - CORRECT ANSWERS
✔✔An advisor is meeting with a Plan Sponsor to discuss
contribution design in her plan. All of the following
questions will help with this conversation, EXCEPT:
, CPFA Exam Question & Answers
(Latest 2025)
A) Is there a goal that employees should be required to
contribute to receive an employer contribution?
B) Can participants convert their existing contribution
accounts to Roth accounts?
C) Is there a group of employees who are unlikely to
participate in the plan?
D) How important is it that employees are on track for
adequate retirement income?
B) Does the company have an established line of credit? -
CORRECT ANSWERS ✔✔Jake is a sole proprietor and
has just established a software development company. He
has recently hired two employees. Currently, the
company does not have a good cash flow, but if Jake can
hire more software engineers, growth and profits should
increase. Based on that information, all of the following
are questions that an advisor should ask when
establishing a plan for Jake's company, EXCEPT:
A) Can the company's current cash flow support employer
contributions?
B) Does the company have an established line of credit?
C) What are Jake's objectives for attracting future
employees?
