NAPA CPFA CERTIFICATION EXAM
Certified Plan Fiduciary Advisor National
Association of Plan Advisors | 2026/2027 Edition
Comprehensive Examination
Core Content Areas (90 Total Questions)
• Fiduciary Roles, Responsibilities & ERISA Regulations (23 Qs)
• Fiduciary Oversight & Plan Administration (23 Qs)
• Plan Investment Management, Selection & Monitoring (22 Qs)
• Plan Management, Fee Analysis & Participant Communications (22 Qs)
Detailed Content Breakdown
Fiduciary Roles, Responsibilities & ERISA Regulations (23 Qs)
• ERISA Fiduciary Definition & Status (Section 3(21)) (5 Qs)
• Prudent Person Standard & Diversification (Section 404) (5 Qs)
• Exclusive Purpose Rule & Duty of Loyalty (4 Qs)
• Prohibited Transactions (Section 406) (5 Qs)
• Fiduciary Liability & Breach Consequences (4 Qs)
Fiduciary Oversight & Plan Administration (23 Qs)
• Plan Governance & Committee Structure (5 Qs)
• Named Fiduciaries & Delegation (4 Qs)
• Document Retention & SPD Requirements (4 Qs)
• Compliance Monitoring & Service Provider Oversight (5 Qs)
• ERISA Bonding & Fiduciary Insurance (5 Qs)
Plan Investment Management, Selection & Monitoring (22 Qs)
, • Investment Policy Statement (IPS) (5 Qs)
• Diversification & Asset Allocation (4 Qs)
• Quantitative & Qualitative Evaluation (4 Qs)
• Benchmarking & Performance Monitoring (5 Qs)
• QDIA & Default Investment Options (4 Qs)
Plan Management, Fee Analysis & Participant Communications (22 Qs)
• Fee Disclosure (408(b)(2) & 404(a)(5)) (5 Qs)
• Revenue Sharing & Indirect Compensation (4 Qs)
• Participant Education vs. Investment Advice (4 Qs)
• Plan Audits & Fiduciary Liability (5 Qs)
• SECURE 2.0 Act Updates & Compliance (4 Qs)
1. Under ERISA Section 3(21), which of the following best defines a fiduciary
with respect to an employee benefit plan?
A. Any individual or entity that exercises discretionary authority over plan
administration
B. Any person who provides investment advice for a fee
C. Any individual or entity that exercises any discretionary authority or
discretionary control respecting management of the plan or exercises any authority
or control respecting management or disposition of plan assets
D. Any employer who sponsors the plan regardless of decision-making authority
Correct Answer: C
Rationale: ERISA Section 3(21)(A) defines a fiduciary as any person who
exercises any discretionary authority or discretionary control respecting
management of the plan or exercises any authority or control respecting
management or disposition of plan assets, renders investment advice for a fee, or
has any discretionary authority or responsibility in plan administration.
,2. What is the primary duty established under ERISA Section 404(a)(1)(B) for
plan fiduciaries?
A. Maximize investment returns at all times
B. Diversify plan investments to minimize the risk of large losses
C. Select only the lowest-cost investment options available
D. Guarantee a minimum rate of return for participants
Correct Answer: B
Rationale: ERISA Section 404(a)(1)(B) requires fiduciaries to diversify plan
investments so as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so. This is known as the diversification
requirement and is a fundamental fiduciary duty.
3. Under the prudent person standard established by ERISA Section
404(a)(1)(A), a fiduciary must act with which of the following?
A. Care, skill, prudence, and diligence that a prudent person acting in a like
capacity and familiar with such matters would use
B. Reasonable care as determined by the plan sponsor's internal policies
C. The level of care exercised by the average individual investor
D. Care consistent with maximizing returns within the plan's risk tolerance
Correct Answer: A
Rationale: ERISA Section 404(a)(1)(A) codifies the prudent person standard,
requiring fiduciaries to discharge their duties with the care, skill, prudence, and
diligence that a prudent person acting in a like capacity and familiar with such
matters would use in light of the purposes of the plan. This is often referred to as
the "prudent expert" standard.
4. Which of the following constitutes a prohibited transaction under ERISA
Section 406(a)?
A. Investing plan assets in a diversified mutual fund
B. A plan fiduciary causing the plan to engage in a transaction that constitutes a
direct or indirect sale or exchange of property between the plan and a party in
interest
, C. Hiring a qualified investment advisor to manage plan assets
D. A participant taking a loan from the plan in accordance with IRC Section 72(p)
Correct Answer: B
Rationale: ERISA Section 406(a)(1)(A) prohibits a fiduciary from causing the
plan to engage in a transaction that directly or indirectly involves the sale,
exchange, or leasing of property between the plan and a party in interest.
Prohibited transactions are banned to prevent self-dealing, unless a specific
prohibited transaction exemption (PTE) exists.
5. Which of the following correctly identifies the four basic fiduciary
standards under ERISA?
A. Loyalty, maximum returns, prudence, and diversification
B. Loyalty, prudence, diversification, and following the plan's governing
documents
C. Maximum returns, diversification, disclosure, and documentation
D. Prudence, disclosure, due diligence, and loyalty
Correct Answer: B
Rationale: The four basic fiduciary standards are: (1) loyalty (exclusive purpose
rule), (2) prudence, (3) diversification, and (4) following the plan's governing
documents to the extent not contrary to ERISA. These standards form the
foundation of fiduciary responsibility under ERISA.
6. The "Exclusive Purpose Rule" under ERISA requires that fiduciaries act:
A. To maximize profits for the plan sponsor
B. Solely for providing benefits to participants and beneficiaries and defraying
reasonable plan expenses
C. To minimize administrative costs at all costs
D. To ensure the plan sponsor has no liability
Correct Answer: B
Rationale: The Exclusive Purpose Rule requires that fiduciaries act solely for
providing benefits to participants and beneficiaries and defraying reasonable plan
Certified Plan Fiduciary Advisor National
Association of Plan Advisors | 2026/2027 Edition
Comprehensive Examination
Core Content Areas (90 Total Questions)
• Fiduciary Roles, Responsibilities & ERISA Regulations (23 Qs)
• Fiduciary Oversight & Plan Administration (23 Qs)
• Plan Investment Management, Selection & Monitoring (22 Qs)
• Plan Management, Fee Analysis & Participant Communications (22 Qs)
Detailed Content Breakdown
Fiduciary Roles, Responsibilities & ERISA Regulations (23 Qs)
• ERISA Fiduciary Definition & Status (Section 3(21)) (5 Qs)
• Prudent Person Standard & Diversification (Section 404) (5 Qs)
• Exclusive Purpose Rule & Duty of Loyalty (4 Qs)
• Prohibited Transactions (Section 406) (5 Qs)
• Fiduciary Liability & Breach Consequences (4 Qs)
Fiduciary Oversight & Plan Administration (23 Qs)
• Plan Governance & Committee Structure (5 Qs)
• Named Fiduciaries & Delegation (4 Qs)
• Document Retention & SPD Requirements (4 Qs)
• Compliance Monitoring & Service Provider Oversight (5 Qs)
• ERISA Bonding & Fiduciary Insurance (5 Qs)
Plan Investment Management, Selection & Monitoring (22 Qs)
, • Investment Policy Statement (IPS) (5 Qs)
• Diversification & Asset Allocation (4 Qs)
• Quantitative & Qualitative Evaluation (4 Qs)
• Benchmarking & Performance Monitoring (5 Qs)
• QDIA & Default Investment Options (4 Qs)
Plan Management, Fee Analysis & Participant Communications (22 Qs)
• Fee Disclosure (408(b)(2) & 404(a)(5)) (5 Qs)
• Revenue Sharing & Indirect Compensation (4 Qs)
• Participant Education vs. Investment Advice (4 Qs)
• Plan Audits & Fiduciary Liability (5 Qs)
• SECURE 2.0 Act Updates & Compliance (4 Qs)
1. Under ERISA Section 3(21), which of the following best defines a fiduciary
with respect to an employee benefit plan?
A. Any individual or entity that exercises discretionary authority over plan
administration
B. Any person who provides investment advice for a fee
C. Any individual or entity that exercises any discretionary authority or
discretionary control respecting management of the plan or exercises any authority
or control respecting management or disposition of plan assets
D. Any employer who sponsors the plan regardless of decision-making authority
Correct Answer: C
Rationale: ERISA Section 3(21)(A) defines a fiduciary as any person who
exercises any discretionary authority or discretionary control respecting
management of the plan or exercises any authority or control respecting
management or disposition of plan assets, renders investment advice for a fee, or
has any discretionary authority or responsibility in plan administration.
,2. What is the primary duty established under ERISA Section 404(a)(1)(B) for
plan fiduciaries?
A. Maximize investment returns at all times
B. Diversify plan investments to minimize the risk of large losses
C. Select only the lowest-cost investment options available
D. Guarantee a minimum rate of return for participants
Correct Answer: B
Rationale: ERISA Section 404(a)(1)(B) requires fiduciaries to diversify plan
investments so as to minimize the risk of large losses, unless under the
circumstances it is clearly prudent not to do so. This is known as the diversification
requirement and is a fundamental fiduciary duty.
3. Under the prudent person standard established by ERISA Section
404(a)(1)(A), a fiduciary must act with which of the following?
A. Care, skill, prudence, and diligence that a prudent person acting in a like
capacity and familiar with such matters would use
B. Reasonable care as determined by the plan sponsor's internal policies
C. The level of care exercised by the average individual investor
D. Care consistent with maximizing returns within the plan's risk tolerance
Correct Answer: A
Rationale: ERISA Section 404(a)(1)(A) codifies the prudent person standard,
requiring fiduciaries to discharge their duties with the care, skill, prudence, and
diligence that a prudent person acting in a like capacity and familiar with such
matters would use in light of the purposes of the plan. This is often referred to as
the "prudent expert" standard.
4. Which of the following constitutes a prohibited transaction under ERISA
Section 406(a)?
A. Investing plan assets in a diversified mutual fund
B. A plan fiduciary causing the plan to engage in a transaction that constitutes a
direct or indirect sale or exchange of property between the plan and a party in
interest
, C. Hiring a qualified investment advisor to manage plan assets
D. A participant taking a loan from the plan in accordance with IRC Section 72(p)
Correct Answer: B
Rationale: ERISA Section 406(a)(1)(A) prohibits a fiduciary from causing the
plan to engage in a transaction that directly or indirectly involves the sale,
exchange, or leasing of property between the plan and a party in interest.
Prohibited transactions are banned to prevent self-dealing, unless a specific
prohibited transaction exemption (PTE) exists.
5. Which of the following correctly identifies the four basic fiduciary
standards under ERISA?
A. Loyalty, maximum returns, prudence, and diversification
B. Loyalty, prudence, diversification, and following the plan's governing
documents
C. Maximum returns, diversification, disclosure, and documentation
D. Prudence, disclosure, due diligence, and loyalty
Correct Answer: B
Rationale: The four basic fiduciary standards are: (1) loyalty (exclusive purpose
rule), (2) prudence, (3) diversification, and (4) following the plan's governing
documents to the extent not contrary to ERISA. These standards form the
foundation of fiduciary responsibility under ERISA.
6. The "Exclusive Purpose Rule" under ERISA requires that fiduciaries act:
A. To maximize profits for the plan sponsor
B. Solely for providing benefits to participants and beneficiaries and defraying
reasonable plan expenses
C. To minimize administrative costs at all costs
D. To ensure the plan sponsor has no liability
Correct Answer: B
Rationale: The Exclusive Purpose Rule requires that fiduciaries act solely for
providing benefits to participants and beneficiaries and defraying reasonable plan
