CTP Treasury Operations and Controls 3

Question 1

A treasury department uses a 'positive pay' service with its bank. What does this control prevent?

Accepted Answer

Check fraud through altered or counterfeit checks

Answer

Positive pay requires the company to transmit issued check data to the bank, which rejects checks not matching the file.

Question 2

Under the CTP exam framework, which document governs how treasury interacts with subsidiaries for intercompany transactions?

Accepted Answer

Intercompany loan agreement or transfer pricing policy

Answer

Intercompany loan agreements or transfer pricing policies establish terms and rates for intercompany treasury transactions.

Question 3

Which risk is MOST directly mitigated by implementing a bank account rationalization program?

Accepted Answer

Operational risk from managing too many idle or redundant accounts

Answer

Bank account rationalization reduces operational complexity and fraud exposure by eliminating unnecessary accounts.

Question 4

What is the key operational difference between a concentration account and a zero-balance account (ZBA)?

Accepted Answer

A ZBA automatically sweeps its balance to a master account at day-end, while a concentration account collects funds manually

Answer

ZBAs automatically transfer all end-of-day balances to a master concentration account, optimizing cash pooling.

Question 5

Which of the following is an example of a preventive control in treasury operations?

Accepted Answer

Requiring dual authorization before releasing a wire payment

Answer

Requiring dual authorization before releasing payments prevents unauthorized transactions from occurring.

Certified Treasury Professional Exam Practice Test