SOFE SOFE Certification SOFE-CFE Questions & Answers

• Question 201:

  What are recognized and accepted by state insurance departments in evaluating the solvency of an insurer for statutory accounting purposes?

  A. Assets

  B. Determined assets

  C. Admitted assets

  D. Altered assets

  Correct Answer: C

• Question 202:

  What do not contribute to an insurer's solvency as measured by statutory accounting requirements?

  A. Non-determined assets

  B. Non-admitted assets

  C. Unacknowledged assets

  D. Disallow assets

  Correct Answer: B

• Question 203:

  What is the quantitative expression of the cost of the resources required to attain the objectives of the plan, as well as an indication of where in the organization and in what forms resources are expected to be used and expensed?

  A. expense budget

  B. controllable expense

  C. budgeting contract

  D. short-term contract

  Correct Answer: A

• Question 204:

  The Specific Risk Analysis (SRA) work-papers used for the review of the operating cycle "Other Expenses" include a review of:

  A. the documentation, purchase approvals, and invoices that support recording a liability

  B. the account distribution procedures when recording a liability or signing a check

  C. procedures for reporting isolated events to accounting personnel for approval

  D. All of the above

  Correct Answer: D

• Question 205:

  The basis for establishing what is found in the firm's management organization chart which documents the reporting relationships and the responsibilities of its executives?

  A. maintenance system

  B. responsibility accounting system

  C. approved system

  D. controllable accounting system

  Correct Answer: B

• Question 206:

  The higher the degree of that reliance, the more time-consuming and costly the audit process is likely to be.

  A. True

  B. False

  Correct Answer: B

• Question 207:

  The type of system can be helpful in showing relationships between volumes of production and variable costs, and the resulting impacts on net income, faster than more conventional full cost absorption systems is referred to as:

  A. Marginal income analysis

  B. pool average cost

  C. prerogative management contract

  D. cost allocation standard

  Correct Answer: A

• Question 208:

  The type of unitary measurement that can be helpful in constructing budgets and evaluating performance in both full absorption and direct costing systems is known as:

  A. Absolute costing

  B. Predetermined expense

  C. Standard costing

  D. cost operations

  Correct Answer: C

• Question 209:

  A managerial accounting system can be of help to management in its decision-making processes, and in _______________ system (or, in broader terms, an expense information system) is an integral part of management accounting.

  A. Liquidity expense

  B. Expense accounting

  C. Future cost

  D. expense accounting

  Correct Answer: D

• Question 210:

  Allocable expenses for property and casualty insurance companies shall be classified into which one of the following three categories on the Underwriting and Investment Exhibit?

  A. Loss Adjustment, Other Underwriting and Investment

  B. Expense Adjustment, Other Underwriting and Investment

  C. Loss Adjustment, Policies and Investment

  D. Loss Adjustment, Insurance commissions and Guidelines

  Correct Answer: A