NAPA CPFA® LATEST
CERTIFICATION EXAM
Explain the roles of service providers - ANSWERS-Advisors: Can be
fiduciary or non-fiduciary
Third Party Administrator (TPA): Testing, Form 5500, eligibility,
contributions, notices
Recordkeeper: Tracks account activity, provides account access,
statements
Independent CPA: Financial reports for plans over 100 participants
Actuaries: Defined Benefit Plans
ERISA Attorneys: Plan documents, amendments, corrections
Identify factors used to assist in service provider selection - ANSWERS-
N/A
Describe fiduciary prudent process for selecting service providers -
ANSWERS-• Fiduciary best practice
• Advisor can help compile a list of potential providers
• Ability to review/compare different providers
• Determine if providers/contracts meet goals of plan
• Ability to determine if fees are reasonable
• Fees paid for services provided
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PAGE
1
, NAPA CPFA® LATEST
CERTIFICATION EXAM
• How paid (direct, indirect)
Explain different types of service providers, including bundled and
unbundled service models - ANSWERS-Bundled
• One provider offers ALL (or more than one)
services
• Investment, recordkeeping, TPA, education
• Cost usually expressed as a single fee
Unbundled
• Different providers for plan services
• Separate TPA, recordkeeper, and advisor
• Each provider charges a separate fee
Describe the role of Plan Sponsors regarding required participant
disclosures - ANSWERS-N/A
Explain risk/return, asset classes and diversification of investments -
ANSWERS-Risk/Return: N/A
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PAGE
2
, NAPA CPFA® LATEST
CERTIFICATION EXAM
Diversification
• Characteristics of different asset classes
• How diversification reduces risk
• Diversification allows different risk and retirement goals
for participants
Explain differences and similarities between investment options -
ANSWERS-Mutual Funds
Brokerage accounts
Separate accounts
Asset allocation funds (Target Date/ Risk)
ETFs
Alternative investments (Real estate, precious
metals, collectibles)
GICs and Stable value funds
Collect Investment Funds (CIFs)
Employer Stock
END OF
PAGE
3
CERTIFICATION EXAM
Explain the roles of service providers - ANSWERS-Advisors: Can be
fiduciary or non-fiduciary
Third Party Administrator (TPA): Testing, Form 5500, eligibility,
contributions, notices
Recordkeeper: Tracks account activity, provides account access,
statements
Independent CPA: Financial reports for plans over 100 participants
Actuaries: Defined Benefit Plans
ERISA Attorneys: Plan documents, amendments, corrections
Identify factors used to assist in service provider selection - ANSWERS-
N/A
Describe fiduciary prudent process for selecting service providers -
ANSWERS-• Fiduciary best practice
• Advisor can help compile a list of potential providers
• Ability to review/compare different providers
• Determine if providers/contracts meet goals of plan
• Ability to determine if fees are reasonable
• Fees paid for services provided
END OF
PAGE
1
, NAPA CPFA® LATEST
CERTIFICATION EXAM
• How paid (direct, indirect)
Explain different types of service providers, including bundled and
unbundled service models - ANSWERS-Bundled
• One provider offers ALL (or more than one)
services
• Investment, recordkeeping, TPA, education
• Cost usually expressed as a single fee
Unbundled
• Different providers for plan services
• Separate TPA, recordkeeper, and advisor
• Each provider charges a separate fee
Describe the role of Plan Sponsors regarding required participant
disclosures - ANSWERS-N/A
Explain risk/return, asset classes and diversification of investments -
ANSWERS-Risk/Return: N/A
END OF
PAGE
2
, NAPA CPFA® LATEST
CERTIFICATION EXAM
Diversification
• Characteristics of different asset classes
• How diversification reduces risk
• Diversification allows different risk and retirement goals
for participants
Explain differences and similarities between investment options -
ANSWERS-Mutual Funds
Brokerage accounts
Separate accounts
Asset allocation funds (Target Date/ Risk)
ETFs
Alternative investments (Real estate, precious
metals, collectibles)
GICs and Stable value funds
Collect Investment Funds (CIFs)
Employer Stock
END OF
PAGE
3
