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CPFA NAPA ACTUAL EXAM PREP 2026 ALL
QUESTIONS AND CORRECT DETAILED
ANSWERS ALREADY A GRADED WITH EXPERT
FEEDBACK |NEW AND REVISED
Which statement regarding the IRS and DOL correction programs is
TRUE?
a. The IRS and DOL correction programs cover identical plan errors.
b. The Voluntary Fiduciary Correction Program can be used only when
an error is found during a DOL investigation.
c. The DOL website includes an online calculator that calculates
earnings amounts to be paid to the plan.
d. The Employee Plans Compliance Resolution System is used to correct
prohibited transaction violations. - ANSWER- c. The DOL website
includes an online calculator that calculates earnings amounts to be paid
to the plan.
All of the following statements describe characteristics of ERISA
fidelity bonds and fiduciary insurance, EXCEPT:
a. Fiduciary insurance may protect plan fiduciaries from losses resulting
from errors.
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b. ERISA fidelity bond protects the employee from any error made when
submitting contributions to a service provider.
c. Plan assets may be used to purchase a fidelity bond.
d. An ERISA fidelity bond may be set-up as a blanket bond that covers
all officers, directors, and employees of a plan sponsor. - ANSWER- b.
ERISA fidelity bond protects the employee from any error made when
submitting contributions to a service provider.
(Insurance protects fiduciaries, bond is required and protects assets from
theft and fraud)
Larry is the owner of DEF Company. Which of Larry's activities is
considered a fiduciary function?
a. Establishes a 401(k) plan for his company.
b. Determines the plan's employer matching contribution formula.
c. Hires the plan's investment advisor.
d. Decides to terminate the 401(k) plan. - ANSWER- c. Hires the plan's
investment advisor.
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All of the following documents should be maintained to show fiduciary
best practices, EXCEPT:
a. Current fee benchmarking report for administration services
b. Documentation of selection process for new payroll vendor
c. Copies of retirement plan committee meeting minutes
d. Copies of retirement plan committee agendas - ANSWER- b.
Documentation of selection process for new payroll vendor
All of the following documents are updated annually, EXCEPT:
a. 404(a)(5) participant fee disclosure
b. Plan document
c. Qualified default investment alternative notice
d. Safe Harbor Matching 401(k) notices - ANSWER- b. Plan document
All of the following are consequences of fiduciary breaches, EXCEPT:
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a. A fiduciary should make good on any losses caused by his or her
fiduciary breach.
b. A fiduciary should restore any profits to the plan that had resulted due
to his or her fiduciary breach.
c. The corporate veil protects fiduciaries from personal liability.
d. A fiduciary who has committed a breach may be removed and
prohibited against serving as a fiduciary in the future. - ANSWER- c.
The corporate veil protects fiduciaries from personal liability.
All of the following are best practices for determining the
reasonableness of plan fees, EXCEPT:
a. Determine whether each individual expense is reasonable.
b. Research revenue sharing arrangements to determine the underlying
cost of services.
c. Determine whether any expenses paid to fiduciaries have violated the
conflict of interest rules.
CPFA NAPA ACTUAL EXAM PREP 2026 ALL
QUESTIONS AND CORRECT DETAILED
ANSWERS ALREADY A GRADED WITH EXPERT
FEEDBACK |NEW AND REVISED
Which statement regarding the IRS and DOL correction programs is
TRUE?
a. The IRS and DOL correction programs cover identical plan errors.
b. The Voluntary Fiduciary Correction Program can be used only when
an error is found during a DOL investigation.
c. The DOL website includes an online calculator that calculates
earnings amounts to be paid to the plan.
d. The Employee Plans Compliance Resolution System is used to correct
prohibited transaction violations. - ANSWER- c. The DOL website
includes an online calculator that calculates earnings amounts to be paid
to the plan.
All of the following statements describe characteristics of ERISA
fidelity bonds and fiduciary insurance, EXCEPT:
a. Fiduciary insurance may protect plan fiduciaries from losses resulting
from errors.
,2|Page
b. ERISA fidelity bond protects the employee from any error made when
submitting contributions to a service provider.
c. Plan assets may be used to purchase a fidelity bond.
d. An ERISA fidelity bond may be set-up as a blanket bond that covers
all officers, directors, and employees of a plan sponsor. - ANSWER- b.
ERISA fidelity bond protects the employee from any error made when
submitting contributions to a service provider.
(Insurance protects fiduciaries, bond is required and protects assets from
theft and fraud)
Larry is the owner of DEF Company. Which of Larry's activities is
considered a fiduciary function?
a. Establishes a 401(k) plan for his company.
b. Determines the plan's employer matching contribution formula.
c. Hires the plan's investment advisor.
d. Decides to terminate the 401(k) plan. - ANSWER- c. Hires the plan's
investment advisor.
,3|Page
All of the following documents should be maintained to show fiduciary
best practices, EXCEPT:
a. Current fee benchmarking report for administration services
b. Documentation of selection process for new payroll vendor
c. Copies of retirement plan committee meeting minutes
d. Copies of retirement plan committee agendas - ANSWER- b.
Documentation of selection process for new payroll vendor
All of the following documents are updated annually, EXCEPT:
a. 404(a)(5) participant fee disclosure
b. Plan document
c. Qualified default investment alternative notice
d. Safe Harbor Matching 401(k) notices - ANSWER- b. Plan document
All of the following are consequences of fiduciary breaches, EXCEPT:
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a. A fiduciary should make good on any losses caused by his or her
fiduciary breach.
b. A fiduciary should restore any profits to the plan that had resulted due
to his or her fiduciary breach.
c. The corporate veil protects fiduciaries from personal liability.
d. A fiduciary who has committed a breach may be removed and
prohibited against serving as a fiduciary in the future. - ANSWER- c.
The corporate veil protects fiduciaries from personal liability.
All of the following are best practices for determining the
reasonableness of plan fees, EXCEPT:
a. Determine whether each individual expense is reasonable.
b. Research revenue sharing arrangements to determine the underlying
cost of services.
c. Determine whether any expenses paid to fiduciaries have violated the
conflict of interest rules.
