CPFA CERTIFICATION EXAM QUESTIONS
AND VERIFIED ANSWERS 2026
▶ June is a Plan Sponsor of a small plan and decided she'll be acting as
the sole fiduciary of the plan. All of the following are her responsibilities,
EXCEPT:
a. Give investment advice to participants
b. Fill the role of Plan Administrator
c. Follow a prudent process when hiring service providers
d. Sign and file the Form 5500. Answer: a. Give investment advice to
participants
▶ Under ERISA, the Plan Administrator has the following roles, EXCEPT:
a. Providing participants with a summary plan description
b. Redesigning the plan's employer matching contribution formula
c. Distributing required notices to participants
d. Providing the plan document to participants who request a copy.
Answer: b. Redesigning the plan's employer matching contribution formula
▶ Under ERISA, all of the following are Plan Trustee responsibilities,
EXCEPT:
a. Monitor the investment manager whom the Plan Trustee hired.
b. Oversee the Plan Administrator.
c. Delegate specific investment duties to a service provider and monitor the
service provider's performance.
,d. Follow participant directions for the investment of contributions, unless
the
instructions conflict with ERISA.. Answer: b. Oversee the Plan
Administrator.
▶ All of the following may be named fiduciaries in a plan document,
EXCEPT:
a. Plan Sponsor
b. Plan Administrator
c. Plan Trustee
d. Legal counsel who prepares the plan document. Answer: d. Legal
counsel who prepares the plan document
▶ Sue is a plan advisor for the ABC Retirement Plan. On the agenda for
the upcoming ABC Plan Committee meeting is an action item to replace
Len and nominate a new member to the Committee. Len has been asked
to leave the Committee due to his unsatisfactory attendance at monthly
meetings. All of the following are best practices regarding fiduciary
changes, EXCEPT:
a. Per Len's request, the Committee minutes will exclude the reason Len
was asked to leave the committee.
b. Sue should educate the members on the importance of documenting
fiduciary changes.
c. The Committee minutes should document the process of naming Len's
replacement.
d. The new member should be informed of the goals of the Committee and
attendance requirements.. Answer: a. Per Len's request, the Committee
minutes will exclude the reason Len was asked to leave the committee.
▶ Sharon is a 3(21) advisor. She is meeting with a potential client and is
preparing for her meeting. All of the following are services that Sharon may
offer the prospect, EXCEPT:
a. Attend the client's investment committee meetings.
,b. Create the agendas for the client's investment committee meetings.
c. Assist with the review of the investments.
d. Make decision to replace funds on the watch list pursuant to the
investment policy statement, prior to attending the investment committee
meeting.. Answer: d. Make decision to replace funds on the watch list
pursuant to the investment policy statement, prior to attending the
investment committee meeting.
▶ All of the following represent potential breaches of fiduciary responsibility
by plan fiduciaries, EXCEPT:
a. A Plan Trustee delegates some of his responsibilities to a discretionary
trustee who he continues to monitor.
b. A Plan Sponsor chooses a bank's recordkeeping service without
performing due diligence because the bank provides reduced rates on
corporate banking services.
c. A Plan Trustee deposits weekly payroll deferrals at the end of the
quarter.
d. A Plan Sponsor appoints a consultant to monitor the plan's service
provider but then ignores the consultant's findings.. Answer: a. A Plan
Trustee delegates some of his responsibilities to a discretionary trustee
who he continues to monitor.
▶ All of the following statements represent the DOL's role in overseeing
plans, EXCEPT:
a. Upon investigation the DOL may request information to identify whether
a prohibited transaction has occurred.
b. The DOL has provided correction methods for specific prohibited
transactions.
c. The DOL and IRS work together to coordinate enforcement on prohibited
transaction issues.
, d. A DOL investigation letter will usually ask for no more than five items
related to the plan's operation.. Answer: d. A DOL investigation letter will
usually ask for no more than five items related to the plan's operation.
▶ 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.
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?
AND VERIFIED ANSWERS 2026
▶ June is a Plan Sponsor of a small plan and decided she'll be acting as
the sole fiduciary of the plan. All of the following are her responsibilities,
EXCEPT:
a. Give investment advice to participants
b. Fill the role of Plan Administrator
c. Follow a prudent process when hiring service providers
d. Sign and file the Form 5500. Answer: a. Give investment advice to
participants
▶ Under ERISA, the Plan Administrator has the following roles, EXCEPT:
a. Providing participants with a summary plan description
b. Redesigning the plan's employer matching contribution formula
c. Distributing required notices to participants
d. Providing the plan document to participants who request a copy.
Answer: b. Redesigning the plan's employer matching contribution formula
▶ Under ERISA, all of the following are Plan Trustee responsibilities,
EXCEPT:
a. Monitor the investment manager whom the Plan Trustee hired.
b. Oversee the Plan Administrator.
c. Delegate specific investment duties to a service provider and monitor the
service provider's performance.
,d. Follow participant directions for the investment of contributions, unless
the
instructions conflict with ERISA.. Answer: b. Oversee the Plan
Administrator.
▶ All of the following may be named fiduciaries in a plan document,
EXCEPT:
a. Plan Sponsor
b. Plan Administrator
c. Plan Trustee
d. Legal counsel who prepares the plan document. Answer: d. Legal
counsel who prepares the plan document
▶ Sue is a plan advisor for the ABC Retirement Plan. On the agenda for
the upcoming ABC Plan Committee meeting is an action item to replace
Len and nominate a new member to the Committee. Len has been asked
to leave the Committee due to his unsatisfactory attendance at monthly
meetings. All of the following are best practices regarding fiduciary
changes, EXCEPT:
a. Per Len's request, the Committee minutes will exclude the reason Len
was asked to leave the committee.
b. Sue should educate the members on the importance of documenting
fiduciary changes.
c. The Committee minutes should document the process of naming Len's
replacement.
d. The new member should be informed of the goals of the Committee and
attendance requirements.. Answer: a. Per Len's request, the Committee
minutes will exclude the reason Len was asked to leave the committee.
▶ Sharon is a 3(21) advisor. She is meeting with a potential client and is
preparing for her meeting. All of the following are services that Sharon may
offer the prospect, EXCEPT:
a. Attend the client's investment committee meetings.
,b. Create the agendas for the client's investment committee meetings.
c. Assist with the review of the investments.
d. Make decision to replace funds on the watch list pursuant to the
investment policy statement, prior to attending the investment committee
meeting.. Answer: d. Make decision to replace funds on the watch list
pursuant to the investment policy statement, prior to attending the
investment committee meeting.
▶ All of the following represent potential breaches of fiduciary responsibility
by plan fiduciaries, EXCEPT:
a. A Plan Trustee delegates some of his responsibilities to a discretionary
trustee who he continues to monitor.
b. A Plan Sponsor chooses a bank's recordkeeping service without
performing due diligence because the bank provides reduced rates on
corporate banking services.
c. A Plan Trustee deposits weekly payroll deferrals at the end of the
quarter.
d. A Plan Sponsor appoints a consultant to monitor the plan's service
provider but then ignores the consultant's findings.. Answer: a. A Plan
Trustee delegates some of his responsibilities to a discretionary trustee
who he continues to monitor.
▶ All of the following statements represent the DOL's role in overseeing
plans, EXCEPT:
a. Upon investigation the DOL may request information to identify whether
a prohibited transaction has occurred.
b. The DOL has provided correction methods for specific prohibited
transactions.
c. The DOL and IRS work together to coordinate enforcement on prohibited
transaction issues.
, d. A DOL investigation letter will usually ask for no more than five items
related to the plan's operation.. Answer: d. A DOL investigation letter will
usually ask for no more than five items related to the plan's operation.
▶ 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.
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?
