CEPA Exam ACTUAL QUESTIONS AND
CORRECT ANSWERS
What survey indicated that 99% of business owners at least in some way agreed that "having a
transition strategy is important for my future and the future of my business?" - CORRECT ANSWER
State of Owner Readiness
It's important to not just tell an owner the right answer, but to ask them the right question. Which is an
example of the "right question" to ask a business owner client? - CORRECT ANSWER a.
What is the strength of your intangible capital?
b. What is your biggest pain point and biggest desire?
c. What deal structure are you looking for when selling?
d. All the above (correct)
Complete the following quote: "Luck is ___ meeting opportunity." - CORRECT ANSWER
Preparation
four intangible capitals (The 4Cs) include Human, Structural, Social, and Customer capitals. (T/F) -
CORRECT ANSWER TRUE
Which of the following statements is false? - CORRECT ANSWER c. The Baby Boomer
generation doesn't need to be thinking about exit planning yet
Complete this sentence: A successful exit strategy balances the "____ Legs of the Stool." - CORRECT
ANSWER b. Three
(Business, Financial, and Personal)
What is one of the main causes of "sellers' cold feet" during the sale of a business? - CORRECT
ANSWER a. Lack of personal planning
What is the first stage in the "Five Stages of Value Maturity?" - CORRECT ANSWER c.
Identify
,When ranking a business's intangible capitals, what is the main purpose of using the common sense
scoring of 1-6? - CORRECT ANSWER c. It forces you to not choose "average"
A key difference between lifestyle businesses and value creator businesses is that value creator
businesses usually generate better income. (T/F) - CORRECT ANSWER True
Which of the following is not a gate in the Value Acceleration Methodology? - CORRECT ANSWER
b. Plan
If the potential value for a business is 16 million, and it's currently valued at 9 million, what is the
value gap of the business? - CORRECT ANSWER a. 7 million
The typical business owner has ____% of their net worth tied up within their business. - CORRECT
ANSWER a. 80%
What is a benefit of prioritizing wealth management for a business owner? - CORRECT ANSWER
a. Tax efficiency
b. Insurances in place (Risk Management)
c. Structured cash flow
d. All of the above (correct)
Life insurance, health insurance, and product liability insurance all fall under which section of the
financial planning process? - CORRECT ANSWER b. Risk Management
Which of the following best describes the components of integrated wealth management for
individuals? - CORRECT ANSWER d. Retirement planning,risk management, estate planning,
portfolio management
A business owner only needs one advisor to complete their exit planning process. (T/F) - CORRECT
ANSWER False!
Typical estate planning conversations discuss how to preserve a decedent spouse's "coupon." (T/F) -
CORRECT ANSWER True
, A _____ gift is one in which the person who received the gift has the unrestricted right to the
immediate possession and use of it. - CORRECT ANSWER c. Present interest gift
Which of the following statements is not true? - CORRECT ANSWER a. All states have an
estate tax
The main goal of minimizing wealth tax is to: - CORRECT ANSWER c. Maximize the client's
portion of earnings and minimize the IRS's portion
What does the acronym "NING" stand for when looking at income tax planning options? - CORRECT
ANSWER b. Nevada Incomplete Non-Grantor Trust
Which of the following is a disadvantage of an intentionally defective grantor trust (IDGT)? -
CORRECT ANSWER d. Client cannot be a beneficiary
A strategy which makes assets difficult or impossible to reach is called: - CORRECT ANSWER
d. Asset protection
What are the benefits for the business owner and family for integrating charitable contributions? -
CORRECT ANSWER a. Wanting to transfer values and purpose, not just assets
b. Creating intergenerational common ground to collaborate, make joint decisions, gain confidence,
develop/fulfill potential c. Developing an emotional and functional bridge between wealth, purpose,
and society
d. All of the above (correct)
Of the 250,000 US companies with $5M to $100M in revenue set to transition by 2030, how many
will actually sell for desired value? - CORRECT ANSWER b. 14,000
As categorized by the Fisher College of Business at the Ohio State University, what are the three
types of companies in the marketplace? - CORRECT ANSWER d. Investors, Innovators,
Efficiency Experts
What are some categories to evaluate and compare to other companies in the marketplace? -
CORRECT ANSWER a. Market growth
CORRECT ANSWERS
What survey indicated that 99% of business owners at least in some way agreed that "having a
transition strategy is important for my future and the future of my business?" - CORRECT ANSWER
State of Owner Readiness
It's important to not just tell an owner the right answer, but to ask them the right question. Which is an
example of the "right question" to ask a business owner client? - CORRECT ANSWER a.
What is the strength of your intangible capital?
b. What is your biggest pain point and biggest desire?
c. What deal structure are you looking for when selling?
d. All the above (correct)
Complete the following quote: "Luck is ___ meeting opportunity." - CORRECT ANSWER
Preparation
four intangible capitals (The 4Cs) include Human, Structural, Social, and Customer capitals. (T/F) -
CORRECT ANSWER TRUE
Which of the following statements is false? - CORRECT ANSWER c. The Baby Boomer
generation doesn't need to be thinking about exit planning yet
Complete this sentence: A successful exit strategy balances the "____ Legs of the Stool." - CORRECT
ANSWER b. Three
(Business, Financial, and Personal)
What is one of the main causes of "sellers' cold feet" during the sale of a business? - CORRECT
ANSWER a. Lack of personal planning
What is the first stage in the "Five Stages of Value Maturity?" - CORRECT ANSWER c.
Identify
,When ranking a business's intangible capitals, what is the main purpose of using the common sense
scoring of 1-6? - CORRECT ANSWER c. It forces you to not choose "average"
A key difference between lifestyle businesses and value creator businesses is that value creator
businesses usually generate better income. (T/F) - CORRECT ANSWER True
Which of the following is not a gate in the Value Acceleration Methodology? - CORRECT ANSWER
b. Plan
If the potential value for a business is 16 million, and it's currently valued at 9 million, what is the
value gap of the business? - CORRECT ANSWER a. 7 million
The typical business owner has ____% of their net worth tied up within their business. - CORRECT
ANSWER a. 80%
What is a benefit of prioritizing wealth management for a business owner? - CORRECT ANSWER
a. Tax efficiency
b. Insurances in place (Risk Management)
c. Structured cash flow
d. All of the above (correct)
Life insurance, health insurance, and product liability insurance all fall under which section of the
financial planning process? - CORRECT ANSWER b. Risk Management
Which of the following best describes the components of integrated wealth management for
individuals? - CORRECT ANSWER d. Retirement planning,risk management, estate planning,
portfolio management
A business owner only needs one advisor to complete their exit planning process. (T/F) - CORRECT
ANSWER False!
Typical estate planning conversations discuss how to preserve a decedent spouse's "coupon." (T/F) -
CORRECT ANSWER True
, A _____ gift is one in which the person who received the gift has the unrestricted right to the
immediate possession and use of it. - CORRECT ANSWER c. Present interest gift
Which of the following statements is not true? - CORRECT ANSWER a. All states have an
estate tax
The main goal of minimizing wealth tax is to: - CORRECT ANSWER c. Maximize the client's
portion of earnings and minimize the IRS's portion
What does the acronym "NING" stand for when looking at income tax planning options? - CORRECT
ANSWER b. Nevada Incomplete Non-Grantor Trust
Which of the following is a disadvantage of an intentionally defective grantor trust (IDGT)? -
CORRECT ANSWER d. Client cannot be a beneficiary
A strategy which makes assets difficult or impossible to reach is called: - CORRECT ANSWER
d. Asset protection
What are the benefits for the business owner and family for integrating charitable contributions? -
CORRECT ANSWER a. Wanting to transfer values and purpose, not just assets
b. Creating intergenerational common ground to collaborate, make joint decisions, gain confidence,
develop/fulfill potential c. Developing an emotional and functional bridge between wealth, purpose,
and society
d. All of the above (correct)
Of the 250,000 US companies with $5M to $100M in revenue set to transition by 2030, how many
will actually sell for desired value? - CORRECT ANSWER b. 14,000
As categorized by the Fisher College of Business at the Ohio State University, what are the three
types of companies in the marketplace? - CORRECT ANSWER d. Investors, Innovators,
Efficiency Experts
What are some categories to evaluate and compare to other companies in the marketplace? -
CORRECT ANSWER a. Market growth
