CTP AFP Certified Treasury Professional Free Practice Exam Questions (2025 Updated)

A company has entered into a loan syndication agreement with four banks. The agreement states the company must maintain certain covenants, and a breach of any covenant will terminate the loan immediately. What is the BEST course of action for the treasurer?

When a company decides to discontinue a product line or divest of a subsidiary, it has made what type of corporate financial decision?

Individuals authorized to open and close bank accounts MUST match:

Which of the following concentration transfer alternatives provide the fastest availability of funds?

Subtracting dividends from net income available to common shareholders is reflected as a change to which of the following balance sheet items?

What determines if the currencies of two countries will trade at a discount, at par, or at a premium in the forward market?

Which of the following methods of compensation is NOT used by banks in the United States?

Company M operates a grocery distribution business on Main Street. As part of its business continuity plan, Company M intends to purchase insurance to cover the facility lease for its Main Street warehouse in the event it cannot operate for a period of time. What type of coverage should Company M purchase?

In order to control increased vulnerability to financial risk, a treasury analyst has been tasked with completing a policy statement on hedging foreign currency. Within this policy, a PRIMARY exposure that needs to be addressed is:

A major publicly owned U.S. airline announces that it can no longer meet its pension obligations. Which organization will assume control of the airline’s pension plan?

Which one of the following is true of capital repatriation for multinational companies?

A company is looking for a technology solution to best link the different functional areas of its company. Which of the following solutions will BEST suit the company?

A firm that thinks interest rates are going to rise is likely to:

An electronics firm realizes that due to adverse events projected over the next 18 months there is a 5% chance that its profits will decrease by $100,000. The company's beta is .08 and its cost of capital is 9%. What approach is the company MOST LIKELY using to determine its level of financial risk?

Pricing distortions, limited risk-sharing options, and capital controls are characteristics of:

A company's basic investment objectives should include all of the following EXCEPT:

A company with operations throughout Europe uses banks that do not provide a full range of local banking services. What would be the BEST approach to concentrate cash?

XYZ Company's cash manager is evaluating cash concentration transfer options. The company has an 8% cost of funds and $50,000 in average daily field cash receipts. The wire transfer results in the transfer of funds one day faster. Which of the following options correctly ranks the transfer choices from most cost-effective to least cost-effective?

1. Electronic depository transfer costing $1.00

2. Electronic depository transfer costing $2.50

3. Wire transfer costing $8.00

4. Wire transfer costing $15.00

An investor relations manager reports to the:

An employee was targeted with a phishing scam, which was deleted and reported to the company's IT department. This shows the company's end-user computing policy includes which of the following?

Which of the following payment instruments is initiated by the payee rather than the payor?

A company is evaluating its long-range plan and determined free cash flow is tight in years one and two, while more favorable in years three through five. Its financial institution has offered an attractive interest rate on a term loan with a maturity option for both two and five years. What is a good financing option for this company?

A U.S.-based importer, whose functional currency is USD, has an FX exposure in GBP related to a GBP denominated payment it will need to make in 120 days. As the company's treasurer is uncertain as to the exchange rate movements between the two currencies, he has decided to hedge the exposure. To do so, the treasurer has decided to purchase futures contracts at today's GBP/USD FX rate and will hold the contracts for 120 days until which the position will be liquidated in order to settle the GBP payable. If the GBP were to strengthen against the USD over the 120 day holding period, will this result in a positive or negative mark to market change on the futures position? Will this increase or decrease the total cost of the USD denominated payable?

All of the following are methods of financing accounts receivable EXCEPT:

Without regard to costs, which of the following concentration mechanisms maximizes investment income in a multi-bank environment?

In comparing the U.S. banking system and foreign banking systems, which of the following statements is true?

The treasurer at Company ABC would like to assess the quality of the company's A/R at an aggregate level by knowing how long the company takes to convert a credit sale into cash. Identify which method the treasurer should use and calculate the result by using the following information regarding Company ABC:

Annual Revenue = $4,500,000

Annual Credit Sales = $3,800,000

Accounts Receivable = $800,000

To monitor financial institution service quality, a company would use all of the following measures EXCEPT:

Since inception, an automobile manufacturer receives all of its parts from the leading industry supplier. What type of risk will the company reduce if it uses an additional distributor?

An assistant treasurer is working to reduce the annual costs for the company's line of credit. The target is to reduce it by 10%. Under the existing credit facility agreement, the cost of the revolving line is:

1. Interest rate on outstanding balance (all in rate): 3.75%

2. Commitment fee of 0.25% on the unused portion of the line.

The expected average use of the line is $1,300,000 and the total amount of the credit facility is $6,000,000. What would be the new credit line to achieve the 10% reduction in total cost?

Ensuring that a message was not modified in transit and that stored information has NOT been improperly modified or deleted is referred to as:

A multinational company is considering a change to several of its international subsidiaries in terms of their banking relationships. The treasurer wants to increase visibility and improve controls globally. A distinct advantage would be to establish security administrators at headquarters and switch all bank users for the company to multi-factor authentication. What will the company need to do in order to implement out-of-band controls and scale this practice for all of its users?

A Treasury Management System (TMS) is used to:

A decrease in the accounts receivable from one period to the next is considered to be:

Banks offer image exchange as a means to accelerate deposits for their customers. If a customer seeks to take advantage of this service, what should the customer implement?

Which of the following is an example of a company's internal data used for cash management?

A company that has a nationwide workforce may use which of the following methods for disbursing payroll to minimize the number of bank accounts?

I. Payable through draft

II. Multiple drawee checks

III. ACH credit transfers

An inverted yield curve occurs when which of the following is true?

All of the following items may be found on an income statement EXCEPT: