SOFE SOFE Certification SOFE-CFE Questions & Answers

• Question 21:

  What are the techniques employed to prevent and detect errors in processing transactions, to safeguard assets and to ensure the reliability of financial records.

  A. Internal accounting controls

  B. Processing transactions

  C. Dynamic controls

  D. Business conducts

  Correct Answer: A

• Question 22:

  Accounting controls are designed to provide reasonable assurance that:

  A. transactions are excluded in accordance with management's general or specific authorization

  B. transactions are recorded as necessary to permit preparation of non-reliable financial statements

  C. accountability for assets is maintained

  D. All of the above

  Correct Answer: C

• Question 23:

  A system of ______________, in the broad sense, includes controls, which may be characterized as either accounting or administrative.

  A. External controls

  B. Financial controls

  C. Internal controls

  D. Investor controls

  Correct Answer: C

• Question 24:

  What include, but are not limited to the plan of organization and the procedures and records that are concerned with the decision processes leading to management's authorization of transactions?

  A. Administrative controls

  B. Globalization

  C. Accurate transactions

  D. Control environment

  Correct Answer: A

• Question 25:

  In SAP, Surplus notes are reported as:

  A. expense

  B. Liability

  C. insolvency

  D. surplus

  Correct Answer: D

• Question 26:

  Federal and state taxes, Relationships with external auditors, Treasury and investment functions are all responsibilities of:

  A. Chief Security Officer

  B. Chief Financial Officer

  C. Senior Management

  D. Chief Executive Officer

  Correct Answer: B

• Question 27:

  In SAP, reserves for losses and loss adjustment expenses and unearned premiums ceded to reinsurers are reported as reductions of the related reserves.

  A. True

  B. False

  Correct Answer: A

• Question 28:

  In GAAP, reserves for losses and loss adjustment expenses and unearned premiums ceded to reinsurers are reported as:

  A. expense

  B. Liability

  C. assets

  D. Taxes

  Correct Answer: C

• Question 29:

  In GAAP, pension and postretirement benefit obligation calculation includes vested participants and active participants not currently eligible.

  A. True

  B. False

  Correct Answer: A

• Question 30:

  What of a particular period is principally determined based on benefits earned by participants during the period (service costs) less earnings on plan assets in excess of interest accretion of the projected benefit obligation.

  A. Obligatory adjustment expense

  B. Payment accounting

  C. Loss adjustment expense

  D. Pension expense

  Correct Answer: D