Practice Test GeeksCertified Treasury Professional Exam Practice Test
← All CTP Flashcard Decks

Regulatory Compliance and Ethics Flashcards

7 cards from real CTP practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Regulatory Compliance and Ethics flashcards as text

  1. According to the AFP (Association for Financial Professionals) Code of Ethics, what is the primary obligation of treasury professionals?

    Answer: Act with integrity, competence, and in the best interests of their organization and the profession

    AFP's Code of Ethics requires treasury professionals to act with integrity, maintain professional competence, and serve both their organization and the broader treasury profession ethically.

  2. What does the concept of 'fiduciary duty' require of a corporate treasurer in managing company funds?

    Answer: Acting in the best interests of the company and its stakeholders rather than in personal self-interest

    Fiduciary duty requires treasury professionals to place the company's and stakeholders' interests above their own, making decisions that benefit the organization rather than themselves.

  3. What is the primary purpose of the 'segregation of duties' principle in treasury operations?

    Answer: Preventing fraud and errors by requiring multiple individuals to complete different parts of sensitive transactions

    Segregation of duties prevents any single employee from having complete control over a financial transaction, reducing the risk of both intentional fraud and undetected errors.

  4. Under Sarbanes-Oxley Act Section 302, which corporate officers are personally required to certify the accuracy of quarterly and annual financial reports?

    Answer: The CEO and CFO

    SOX Section 302 requires the CEO and CFO to personally certify the accuracy of financial statements filed with the SEC, creating personal liability for material misstatements.

  5. What protections does the Dodd-Frank Act's whistleblower program provide to treasury professionals who report securities violations?

    Answer: Legal protection from retaliation and potential monetary awards for tips leading to successful SEC enforcement actions

    Dodd-Frank's whistleblower provisions protect employees from retaliation when reporting potential securities violations to the SEC and may provide financial awards of 10-30% of sanctions exceeding $1 million.

  6. How does the Foreign Corrupt Practices Act (FCPA) most directly impact corporate treasury operations?

    Answer: It prohibits bribery of foreign government officials and requires accurate accounting records for all payments

    The FCPA prohibits bribery of foreign officials to obtain business advantages and requires companies to maintain accurate books and records, directly impacting how treasury processes and documents international payments.

  7. What does the principle of 'materiality' mean in the context of financial disclosure and compliance for treasury professionals?

    Answer: Information that would significantly influence a reasonable investor's decision must be disclosed in financial reports

    Materiality means that information significant enough to influence the decisions of a reasonable investor must be disclosed, guiding treasury professionals on what financial data requires public reporting.