CPP CPP Quality & Compliance 4

Question 1

Under the Electronic Fund Transfer Act, an employer may require direct deposit of wages ONLY if:

Accepted Answer

State law explicitly permits mandatory direct deposit and the employer complies with any state requirements

Answer

Whether mandatory direct deposit is permissible depends on state law; some states prohibit it, while others allow it with conditions such as employee choice of financial institution.

Question 2

A payroll manager is reviewing a Certified Payroll Report (WH-347) for a federal prevailing wage project. Which law requires this report?

Accepted Answer

The Davis-Bacon Act

Answer

The Davis-Bacon Act requires contractors on federal construction projects to pay prevailing wages and submit certified payroll reports on Form WH-347 to the contracting agency.

Question 3

An employee's Form W-4 is submitted with an invalid status claim. Under IRS guidance, what should the employer do?

Accepted Answer

Apply the prior valid W-4 on file, or withhold at single/zero if no prior W-4 exists

Answer

If a W-4 is invalid, the employer should withhold based on the most recently valid W-4 on file, or at the default single/zero allowances rate if no valid prior W-4 exists.

Question 4

Which payroll record retention period is required under the FLSA for payroll records such as time cards and work schedules?

Accepted Answer

3 years

Answer

The FLSA requires that supplementary records such as time cards, work schedules, and records of additions or deductions be retained for at least 2 years.

Question 5

A company processes payroll using an outside service bureau. From an internal controls perspective, the company should PRIMARILY obtain which document annually from the service bureau?

Accepted Answer

A SOC 1 Type II report covering payroll processing controls

Answer

A SOC 1 Type II report provides an independent auditor's assessment of the service bureau's internal controls over financial reporting, which is essential for the company's own control environment.

CPP - Certified Payroll Professional Practice Test

CPP - Certified Payroll Professional Practice Test

CPP CPP Quality & Compliance 4