AFP CTP Exam Practice Test Instant Access

Question 1

One of the PRIMARY ways the Fed addresses systemic risk is by:

Aassigning passwords and PINs to identify authorized users of its Fedwire system.

Bestablishing intra-day credit limits for ACH originators.

Csetting minimum reserve requirements for its member banks.

Dsetting daylight overdraft limits for its member banks.

Answer : D

Question 2

A portfolio manager's investment policy states that they are not allowed to hold any investments that have extension risk. Which type of investment should the portfolio manager avoid?

AREMICs

BGinnie Mae MBSes

CMunicipal bonds

DTreasury notes

Answer : B

Question 3

A multinational company that uses ''notional pooling'' for its euro zone subsidiaries will realize which of the following advantages?

AEnhanced accounting for transactions since funds are transferred into one account

BMobilization of cash resources and thus economies of scale in making transfers

CSubsidiary cash balances are netted each day to calculate interest, but funds are not transferred

DAn expanded number of euro zone banks in order to facilitate better service to transfer funds

Answer : C

Question 4

Which of the following ASC X12 transactions is used to confirm the receipt and compliance of transmitted sets?

A821

B822

C835

D997

Answer : D

Question 5

Company A has decided to purchase $3,000,000 of real estate from Company B. Company A will make the payment in 3 parts. The electronic payments will be sent from Bank A to Bank B. On Day 1 Company A will send a $400,000 check as a deposit, which is deductible from the balance. The check is expected to clear in 4 days. On Day 2, two payments are initiated, one wire transfer for $2,000,000 and an ACH for $600,000 to complete the balance. On Day 2 what percentage of the payment to Company B is NOT final?

A33.3%

B66.7%

C86.7%

D100%

Answer : A

Question 6

An accountant is fired after reporting to the SEC that she witnessed the CFO inappropriately reduce expenses ahead of the quarterly earnings announcement. Which of the following would apply?

AThe accountant is protected by 'whistle-blower' laws.

BThe CFO is liable for Bank Secrecy Act reporting.

CThe accountant is in violation of Section 404 of the Sarbanes-Oxley Act.

DThe CFO is protected by the code of ethics.

Answer : A

Question 7

When using the Internet to access auction markets, companies may use certificate authorities to reduce their exposure to which of the following types of risk?

ACredit

BValuation

CCounterparty

DForeign exchange

Answer : C

AFP CTP Certified Treasury Professional Exam Practice Test