CPFA EXAM REVIEWED
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which Statement regarding service providers is TRUE? - ANS-1. A TPA performs annual
compliance testing 2. A recordkeeper has the legal obligation to provide an
interpretation of a plan provision. 3. An accountant processes the "money out" for a
participant withdrawal. 4. A plan advisor is responsible for drafting annual safe harbor
notices.
1.
all of the following are important factors when selecting a service provider, EXCEPT: -
ANS-1. Service provider's financial stability. 2. experience with plans of similar size and
complexity. 3. willingness to provide revenue sharing to offset plan fees. 4.
qualifications of personnel that will service the plan
3.
which statement regarding bundled service arrangements is TRUE? - ANS-1. Provides
efficient contribution and distribution processes. 2. requires less fiduciary oversight
than an unbundled service arrangement. 3. permits for a specific single provider within
the arrangement to be easily removed and replaced with another provider. 4. typical
arrangement involves a TPA and an insurance company?
, 1.
company abc and company def are determined to be part of a related group of
companies. all of the following statements are TRUE, EXCEPT: - ANS-1. the employees
of both abc and def may end up participating in one plan. 2. abc may be required to
make contributions for its employees in def's plan. def has the right to "opt out" and
be excluded from the related group. 4. if def adopts a plan, abc employees may be
eligible for the plan.
3.
which of the following plan deigns may result in better participant deferral behavior?
1. adding an employer matching contribution equal to 25% up to 12% of compensation
deferred. 2. adding a 3% nonelective safe harbor contribution. 3. adding a profit
sharing contribution - ANS-1.
an advisor is meeting with a plan sponsor to discuss contribution in her plan. all of the
following questions will help with this conversation, EXCEPT - ANS-1. is there a goal
that employees should be required to contribute to receive an employer contribution?
2. Can participants convert their existing contribution accounts to roth accounts? 3. Is
there a group of employees who are unlikely to participate in the plan? How important
is it that employees are on track for adequate retirement income?
2.
all of the following service providers may assist with plan document maintenance,
except - ANS-1. ERISA attorney. 2. Recordkeeper. 3. TPA firm. 4. Plan auditor
4.
which statement regarding to and through target date funds are true? - ANS-1. if a
majority of participants cash out of a plan upon retirement, a through strategy may be
appropriate. 2. a to target date fund may be a good choice if many retirees have
account balances in the plan. 3. a key difference between to and through target date
funds are their glide paths. 4. a through target date fund develops its asset allocation
based on the participant's risk tolerance.
QUESTIONS AND
CORRECT ANSWERS
GRADED A+ 2025-2026
Which Statement regarding service providers is TRUE? - ANS-1. A TPA performs annual
compliance testing 2. A recordkeeper has the legal obligation to provide an
interpretation of a plan provision. 3. An accountant processes the "money out" for a
participant withdrawal. 4. A plan advisor is responsible for drafting annual safe harbor
notices.
1.
all of the following are important factors when selecting a service provider, EXCEPT: -
ANS-1. Service provider's financial stability. 2. experience with plans of similar size and
complexity. 3. willingness to provide revenue sharing to offset plan fees. 4.
qualifications of personnel that will service the plan
3.
which statement regarding bundled service arrangements is TRUE? - ANS-1. Provides
efficient contribution and distribution processes. 2. requires less fiduciary oversight
than an unbundled service arrangement. 3. permits for a specific single provider within
the arrangement to be easily removed and replaced with another provider. 4. typical
arrangement involves a TPA and an insurance company?
, 1.
company abc and company def are determined to be part of a related group of
companies. all of the following statements are TRUE, EXCEPT: - ANS-1. the employees
of both abc and def may end up participating in one plan. 2. abc may be required to
make contributions for its employees in def's plan. def has the right to "opt out" and
be excluded from the related group. 4. if def adopts a plan, abc employees may be
eligible for the plan.
3.
which of the following plan deigns may result in better participant deferral behavior?
1. adding an employer matching contribution equal to 25% up to 12% of compensation
deferred. 2. adding a 3% nonelective safe harbor contribution. 3. adding a profit
sharing contribution - ANS-1.
an advisor is meeting with a plan sponsor to discuss contribution in her plan. all of the
following questions will help with this conversation, EXCEPT - ANS-1. is there a goal
that employees should be required to contribute to receive an employer contribution?
2. Can participants convert their existing contribution accounts to roth accounts? 3. Is
there a group of employees who are unlikely to participate in the plan? How important
is it that employees are on track for adequate retirement income?
2.
all of the following service providers may assist with plan document maintenance,
except - ANS-1. ERISA attorney. 2. Recordkeeper. 3. TPA firm. 4. Plan auditor
4.
which statement regarding to and through target date funds are true? - ANS-1. if a
majority of participants cash out of a plan upon retirement, a through strategy may be
appropriate. 2. a to target date fund may be a good choice if many retirees have
account balances in the plan. 3. a key difference between to and through target date
funds are their glide paths. 4. a through target date fund develops its asset allocation
based on the participant's risk tolerance.
