CEPA (Certified Exit
Planning Advisor) Exam
1. What is the primary goal of the Value Acceleration Methodology™ in exit
planning?
A. To maximize tax savings for the owner
B. To build, harvest, and preserve business value
C. To ensure family succession
D. To reduce employee turnover
Answer: B. To build, harvest, and preserve business value
Explanation: Value Acceleration is about integrating business, personal, and financial
planning to grow transferable business value.
,2. Which of the following is considered one of the “Three Legs of the Stool” in exit
planning?
A. Business strategy
B. Legal documentation
C. Business, personal, and financial goals
D. Leadership coaching
Answer: C. Business, personal, and financial goals
Explanation: CEPA methodology integrates business, personal, and financial planning
as the three critical legs of a successful exit plan.
3. An owner expresses interest in selling the business within the next year but has no
clear financial plan. What is the advisor’s FIRST step?
A. Identify potential buyers
B. Prepare a valuation engagement
C. Conduct a personal financial readiness assessment
D. Draft legal sale documents
Answer: C. Conduct a personal financial readiness assessment
Explanation: Exit planning begins by assessing personal financial readiness, since this
determines whether the owner can meet life-after-exit goals.
4. Which of the following best defines “transferable value”?
A. The emotional value of the business to the owner
B. The portion of the business value that can be monetized by the owner
C. The fair market value established by a valuation expert
D. The accounting book value of the company
Answer: B. The portion of the business value that can be monetized by the owner
Explanation: Transferable value is what a buyer would pay and what the owner can
realize upon exit.
,5. Which type of buyer typically places the highest premium on synergies when
purchasing a company?
A. Financial buyer
B. Strategic buyer
C. Individual investor
D. Private equity group
Answer: B. Strategic buyer
Explanation: Strategic buyers often pay more than financial buyers because they
seek synergies (e.g., market expansion, technology, customer base).
6. In the CEPA framework, which step comes immediately after “Discover”?
A. Plan
B. Prepare
C. Decide
D. Design
Answer: B. Prepare
Explanation: The Value Acceleration Methodology follows the sequence: Discover →
Prepare → Decide.
7. Which valuation approach estimates a company’s worth by projecting future
income and discounting it to present value?
A. Asset approach
B. Income approach
C. Market approach
D. Book value method
Answer: B. Income approach
Explanation: The income approach relies on discounted cash flows or capitalization
of earnings.
, 8. Why is aligning personal and business goals critical in exit planning?
A. It avoids conflicts with employees
B. It ensures a smooth transaction with lawyers
C. It guarantees the owner’s wealth and life-after-exit goals are met
D. It reduces exit taxes
Answer: C. It guarantees the owner’s wealth and life-after-exit goals are met
Explanation: Without alignment, owners may sell too early, too late, or for less than
required to meet their personal financial goals.
9. Which of the following is a “financial readiness” consideration in exit planning?
A. Leadership succession
B. Estate planning
C. Access to private equity financing
D. Post-sale income needs
Answer: D. Post-sale income needs
Explanation: Financial readiness assesses whether the owner can fund post-exit
lifestyle, retirement, and personal goals.
10. When advising on family succession, what is the biggest challenge?
A. Finding an external buyer
B. Ensuring tax compliance
C. Managing emotional dynamics and family relationships
D. Securing private equity backing
Answer: C. Managing emotional dynamics and family relationships
Explanation: Family transitions are often the most complex due to non-financial
considerations and generational conflicts.11. Which professional typically leads the
exit planning advisory team?
A. Attorney
Planning Advisor) Exam
1. What is the primary goal of the Value Acceleration Methodology™ in exit
planning?
A. To maximize tax savings for the owner
B. To build, harvest, and preserve business value
C. To ensure family succession
D. To reduce employee turnover
Answer: B. To build, harvest, and preserve business value
Explanation: Value Acceleration is about integrating business, personal, and financial
planning to grow transferable business value.
,2. Which of the following is considered one of the “Three Legs of the Stool” in exit
planning?
A. Business strategy
B. Legal documentation
C. Business, personal, and financial goals
D. Leadership coaching
Answer: C. Business, personal, and financial goals
Explanation: CEPA methodology integrates business, personal, and financial planning
as the three critical legs of a successful exit plan.
3. An owner expresses interest in selling the business within the next year but has no
clear financial plan. What is the advisor’s FIRST step?
A. Identify potential buyers
B. Prepare a valuation engagement
C. Conduct a personal financial readiness assessment
D. Draft legal sale documents
Answer: C. Conduct a personal financial readiness assessment
Explanation: Exit planning begins by assessing personal financial readiness, since this
determines whether the owner can meet life-after-exit goals.
4. Which of the following best defines “transferable value”?
A. The emotional value of the business to the owner
B. The portion of the business value that can be monetized by the owner
C. The fair market value established by a valuation expert
D. The accounting book value of the company
Answer: B. The portion of the business value that can be monetized by the owner
Explanation: Transferable value is what a buyer would pay and what the owner can
realize upon exit.
,5. Which type of buyer typically places the highest premium on synergies when
purchasing a company?
A. Financial buyer
B. Strategic buyer
C. Individual investor
D. Private equity group
Answer: B. Strategic buyer
Explanation: Strategic buyers often pay more than financial buyers because they
seek synergies (e.g., market expansion, technology, customer base).
6. In the CEPA framework, which step comes immediately after “Discover”?
A. Plan
B. Prepare
C. Decide
D. Design
Answer: B. Prepare
Explanation: The Value Acceleration Methodology follows the sequence: Discover →
Prepare → Decide.
7. Which valuation approach estimates a company’s worth by projecting future
income and discounting it to present value?
A. Asset approach
B. Income approach
C. Market approach
D. Book value method
Answer: B. Income approach
Explanation: The income approach relies on discounted cash flows or capitalization
of earnings.
, 8. Why is aligning personal and business goals critical in exit planning?
A. It avoids conflicts with employees
B. It ensures a smooth transaction with lawyers
C. It guarantees the owner’s wealth and life-after-exit goals are met
D. It reduces exit taxes
Answer: C. It guarantees the owner’s wealth and life-after-exit goals are met
Explanation: Without alignment, owners may sell too early, too late, or for less than
required to meet their personal financial goals.
9. Which of the following is a “financial readiness” consideration in exit planning?
A. Leadership succession
B. Estate planning
C. Access to private equity financing
D. Post-sale income needs
Answer: D. Post-sale income needs
Explanation: Financial readiness assesses whether the owner can fund post-exit
lifestyle, retirement, and personal goals.
10. When advising on family succession, what is the biggest challenge?
A. Finding an external buyer
B. Ensuring tax compliance
C. Managing emotional dynamics and family relationships
D. Securing private equity backing
Answer: C. Managing emotional dynamics and family relationships
Explanation: Family transitions are often the most complex due to non-financial
considerations and generational conflicts.11. Which professional typically leads the
exit planning advisory team?
A. Attorney
