APS IOFM Accredited Payables Specialist (APS) Certification Exam Free Practice Exam Questions (2025 Updated)

Wire transfers are a secure and immediate payment method typically used for high-value transactions due to their reliability and speed, despite higher transaction fees compared to other methods like ACH. Organizations commonly use wire transfers for high dollar payments, such as large vendor payments, international transactions, or critical one-time payments.

The web source from Corcentric explains: “Wire transfers are often used for high-value payments where speed and security are critical, such as large supplier payments or international transactions.” This aligns with Option B.

Direct deposit of executive pay (A)is typically handled via ACH for regular payroll.

Low dollar bulk payments (C)are more cost-effectively processed via ACH or checks.

Rent or mortgage payments (D)may use wire transfers in some cases but are not the most common use.

The IOFM APS Certification Program covers “Payments,” including payment methods like wire transfers. The curriculum’s focus on “peer-tested best practices” supports the use of wire transfers for high dollar payments due to their security and immediacy.

TheInvoicestopic in the APS Certification Program covers the complexities of value-added tax (VAT) refunds, particularly for businesses operating in VAT jurisdictions (e.g., EU). VAT refund processes are stringent, requiring specific invoice details like the company’s name and address (Item I) and, in many cases, original invoices (Item III). However,only authorized agents applying for refunds (Item II)is not universally true, as businesses or their tax representatives can often file directly, depending on the jurisdiction.

Item I (Invoices must include the name and address of the company filing for the refund): True. VAT regulations (e.g., EU VAT Directive) require invoices to include the claimant’s name and address to verify eligibility. This contributes to refund difficulty.

Item II (Only authorized agents may apply for the refunds): Not universally true. While some jurisdictions allow or require agents, businesses can often file directly or designate representatives without mandating third-party agents. This does not consistently contribute to difficulty.

Item III (An original invoice must be submitted): True. Many VAT jurisdictions require original invoices (or certified copies) to validate claims, increasing administrative burden and difficulty.

Option A (II only): Incorrect, as Item II is not universally applicable, and Items I and III are valid.

Option B (I only): Incorrect, as Item III also contributes to refund difficulty.

Option C (I and III only): Correct, as Items I and III are standard requirements that make VAT refunds difficult.

Option D (II and III only): Incorrect, as Item II is not a universal requirement.

Reference to IOFM APS Documents: The APS e-textbook underInvoicesstates, “VAT refund processes are complex due to requirements like including the claimant’s name and address on invoices and submitting original invoices.” It notes that “while agents may assist, direct filing bybusinesses is often permitted, depending on the jurisdiction.” The training video discusses VAT refunds, highlighting the need for “specific invoice details and original documents” as key challenges.

TheInternal Controlstopic in the IOFM APS Certification Program covers the COSO (Committee of Sponsoring Organizations) framework, a widely recognized model for designing and evaluating internal controls, as mandated by the Sarbanes-Oxley Act (SOX). The COSO framework includes five components: Control Environment, Risk Assessment, Control Activities, Information and Communication, and Monitoring Activities.Accounting principlesare not a COSO component, as they relate to GAAP (Generally Accepted Accounting Principles), not internal control categories.

Option A (Control environment): This is a COSO component, setting the tone for the organization’s control consciousness, including leadership and ethics.

Option B (Information and communication): This is a COSO component, ensuring relevant information is identified, captured, and communicated effectively.

Option C (Risk assessment): This is a COSO component, involving the identification and analysis of risks to achieving objectives.

Option D (Accounting principles): Accounting principles (e.g., GAAP) guide financial reporting but are not part of the COSO framework’s internal control categories. This is the correct answer.

Reference to IOFM APS Documents: The APS e-textbook underInternal Controlsstates, “The COSO framework includes five components: Control Environment, Risk Assessment, Control Activities, Information and Communication, and Monitoring Activities, used to design and testinternal controls.” It distinguishes COSO from GAAP, noting that “accounting principles govern financial reporting, not internal control frameworks.” The training video reinforces this by discussing COSO’s role in SOX compliance, listing the five components and excluding accounting principles.

TheVendor Master Filetopic in the IOFM APS Certification Program emphasizes the importance of structured data in the vendor master file (VMF) to support organizational processes. Entering acommodity code(a standardized code classifying goods or services) in a user-defined field allows procurement to categorize vendor offerings, enablingspend analysisto identify spending patterns, negotiate better terms, and optimize supplier selection.

Option A (It prevents a duplicate vendor from being entered): Incorrect. Commodity codes classify goods/services, not vendor identities; duplicate prevention relies on TIN or name checks.

Option B (It indicates which team member created the new record): Incorrect. Commodity codes are unrelated to record creation metadata, which is tracked separately.

Option C (It automatically generates a price comparison to other similar vendors): Incorrect. Commodity codes enable categorization but do not automatically generate price comparisons; additional tools are needed.

Option D (It enables procurement to use the data for spend analysis): Correct. Commodity codes allow procurement to group vendors by product/service type, facilitating spend analysis and strategic sourcing.

Reference to IOFM APS Documents: The APS e-textbook underVendor Master Filestates, “Entering commodity codes in the vendor master file enables procurement to perform spend analysis by categorizing vendor goods and services.” The training video notes, “Commodity codes support procurement’s ability to analyze spending patterns, a key benefit of structured VMF data.”

Automation in accounts payable often introduces significant changes, such as new systems or workflows. A good strategy is tounderstand and accept that it will take time to learn a new system(Option D), which involves embracing training, adapting to new processes, and recognizing the learning curve. This proactive approach supports successful implementation and long-term efficiency. Requesting reassignment (Option A), delaying implementation (Option B), or ignoring the change (Option C) are not constructive strategies, as they resist adaptation and hinder organizational progress.

The web source from SAP Concur states: “To manage change from AP automation, employees should embrace the learning process, understanding that mastering new systems takes time and training.” This directly supports Option D.

The IOFM APS Certification Program covers “Technology and Automation,” including strategies for managing change during automation. The curriculum’s focus on “peer-tested best practices” emphasizes proactive adaptation to new technologies.

TheTax and Regulatory Compliancetopic in the APS Certification Program covers the Sarbanes-Oxley Act (SOX), enacted in response to corporate scandals like Enron and WorldCom in the early 2000s. A key provision of SOX is the protection ofwhistleblowers—employees who report fraudulent or illegal activities within their organization. Section 806 of SOX safeguards whistleblowers from retaliation, such as termination or discrimination, encouraging them to expose financial misconduct.

Option A (Executives): SOX holds executives accountable (e.g., through CEO/CFO certifications under Section 302), but it does not specifically protect them. This option is incorrect.

Option B (Whistleblowers): Correct. SOX’s whistleblower protections ensure employees who report fraud or violations are shielded from retaliation, addressing the chilling effect seen in scandals like Enron.

Option C (Auditors): While SOX strengthens auditor independence (e.g., via the Public Company Accounting Oversight Board), it does not classify auditors as a protected employee class. This option is incorrect.

Option D (Hourly employees): SOX protections apply to all employees who report misconduct, not specifically hourly employees. Whistleblowers, regardless of role, are the protected class. This option is incorrect.

Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Compliancestates, “The Sarbanes-Oxley Act, enacted after scandals like Enron, includes Section 806 to protect whistleblowers from retaliation when reporting financial misconduct.” The training video emphasizes SOX’s role in encouraging transparency, noting that “whistleblower protections ensure employees can safely report violations, strengthening internal controls.”

Data integrity refers to the assurance that data remains accurate, complete, and unaltered throughout its lifecycle, whether during storage, processing, or transmission. It ensures that data is free from unauthorized modifications or corruption. While testing for accuracy (Option D) is related, data integrity specifically focuses on preventing unauthorized changes (Option A). A digital signature (Option B) or encryption (Option C) are security measures that may support data integrity but do not define it.

The web source from Corcentric states: “Data integrity means that data remains unaltered and consistent, ensuring it is free from unauthorized modifications or errors.” This directly supports Option A.

The IOFM APS Certification Program covers “Internal Controls,” including data security and integrity in AP processes. The curriculum’s focus on “peer-tested best practices” aligns with the definition of data integrity as preventing unauthorized alterations.

A recurring wire transfer is a payment set up to occur automatically on a regular schedule (e.g., weekly, monthly) to the same recipient organization, such as a vendor or service provider, often for fixed or variable amounts. The defining characteristic is that it ismade to the same organization each time, ensuring consistency in the recipient. The timing (Option A) and amount (Option C) may vary depending on the agreement, and the transfer is not required to use CHIPS (Option D), as wire transfers can be processed through other systems like Fedwire or SWIFT.

The web source from Tipalti states: “A recurring wire transfer is an automated payment to the same organization on a regular schedule, such as for rent or subscriptions, with amounts that may vary.” This directly supports Option B.

The IOFM APS Certification Program covers “Payments,” including wire transfers and recurring payment setups. The curriculum’s focus on “peer-tested best practices” aligns with the definition of recurring wire transfers as payments to a consistent recipient.

TheVendor Master Filetopic in the APS Certification Program outlines the goals of a vendor management program, which include preventing duplicate payments, ensuring compliance with laws (e.g., IRS reporting), and collecting spend data for procurement.Streamlining sales and use tax processes, while related to AP, is typically handled through tax compliance systems or purchasing processes, not the vendor management program, which focuses on vendor data and relationships.

Option A (Reducing duplicate payments): A key goal, achieved by maintaining accurate vendor master file data to avoid duplicate vendor entries.

Option B (Streamlining sales and use tax process): Not a primary goal. Sales tax processes are managed separately, often through AP or procurement systems, not the vendor management program. Correct answer.

Option C (Collecting spend information for procurement): A goal, as vendor management provides data on spending patterns, aiding procurement negotiations.

Option D (Compliance with laws and regulations): A goal, ensuring vendor data supports IRS reporting (e.g., 1099s) and sanction list compliance.

Reference to IOFM APS Documents: The APS e-textbook underVendor Master Filestates, “Vendor management programs aim to reduce duplicate payments, ensure regulatory compliance, and collect spend data for procurement, but sales tax processes are typically managed outside vendor management.” The training video notes, “Vendor management focuses on accurate data to prevent errors like duplicates and support compliance, not directly on tax processes.”

TheInternal Controlstopic in the APS Certification Program highlights the importance of a sound records management plan for AP processes, particularly for compliance, security, and financialanalysis. A records management plan ensures that documents (e.g., invoices, vendor data) are organized, secure, and accessible, supporting legal protection, information security, and expenditure analysis.

Item I (To afford some protection against lawsuits): A records management plan ensures documentation is available to defend against legal claims, such as vendor disputes or audits, providing evidence of compliance. This is a valid reason.

Item II (To safeguard vital information): Records management protects sensitive data (e.g., vendor TINs, payment details) from loss or unauthorized access, ensuring confidentiality and compliance. This is a valid reason.

Item III (To analyze and manage expenditures): Records management enables AP to track and analyze spending patterns, supporting budgeting and cost control. This is a valid reason.

Option A (III only): Incorrect, as Items I and II are also valid reasons.

Option B (I and II only): Incorrect, as Item III is also a valid reason.

Option C (I, II, and III): Correct, as all three items are reasons for a sound records management plan.

Option D (I only): Incorrect, as Items II and III are also valid reasons.

Reference to IOFM APS Documents: The APS e-textbook underInternal Controlsstates, “A sound records management plan protects against lawsuits by maintaining auditable records, safeguards vital information like vendor data, and enables expenditure analysis for cost management.” The training video discusses records management as a critical control, citing its role in legal compliance, data security, and financial oversight.

The Sarbanes-Oxley Act (SOX) of 2002 imposes strict requirements on financial reporting and internal controls for U.S. public companies. For T&E processes, SOX compliance requires accurate recordkeeping to ensure financial transparency (Option I) and a reliable approval workflow to prevent fraud and ensure proper authorization (Option II). While report generation with visibility (Option III) is valuable for oversight, it is not explicitly mandated by SOX, which focuses on controls and documentation rather than specific reporting tools.

The web source from Tipalti states: “SOX compliance for T&E processes requires accurate recordkeeping to support financial reporting and a robust approval workflow to ensure proper authorization and prevent fraud.” This supports Options I and II. Option III, while beneficial, is not a direct SOX requirement, as SOX emphasizes controls over reporting mechanisms.

The IOFM APS Certification Program covers “Tax and Regulatory Compliance,” including SOX requirements for financial processes like T&E. The curriculum’s focus on “peer-tested best practices” aligns with the need for accurate records and reliable approvals to meet SOX standards.

A "direct spend" invoice pertains to expenditures directly tied to the production of goods or services, such as raw materials or inventory used in manufacturing or resale. In accounts payable, direct spend is distinguished from indirect spend, which covers operational expenses like supplies or repairs that support business operations but are not incorporated into the final product. The correct answer is "Inventory," as it directly relates to goods acquired for production or resale, aligning with the definition of direct spend.

According to the web source from SAP Concur: “Direct spend refers to the purchase of goods and services that are directly incorporated into a product being manufactured, such as raw materials… Indirect spend refers to expenses that support the operations of a business but are not directly included in the final product, such as utilities, office supplies, and facility maintenance.” Inventory, particularly raw materials or goods for resale, is a core component of direct spend, whereas supplies (e.g., office supplies) and repairs (e.g., equipment maintenance) typically fall under indirect spend. The option "Material" could also be associated with direct spend, but "Inventory" is the more precise term in this context, as it encompasses materials used in production or sale.

The IOFM Accounts Payable Specialist (APS) Certification Program includes the topic of “Invoices,” which covers invoice types and their purposes. While the IOFM study guide does not explicitly define “direct spend” in the provided sources, its focus on invoice processing and procurement processes implies familiarity with distinguishing direct and indirect spend. The curriculum’s emphasis on “peer-tested best practices for each phase of the payment process” supports the standard industry definition provided by SAP Concur.

TheTechnology and Automationtopic in the IOFM APS Certification Program covers strategies for optimizing AP processes, including the establishment of shared services centers (SSCs). SSCs consolidate back-office functions like AP to improve efficiency and reduce costs. Key requirements for a successful SSC include performance metrics to measure success, a customer serviceorientation to support internal and external stakeholders, and a change in mindset to embrace centralized processes. However, agreenfield site(a new, undeveloped location) is not a requirement, as SSCs can be established in existing facilities or virtual environments.

Option A (Performance metrics): Performance metrics (e.g., cost per invoice, processing time) are essential to evaluate the SSC’s efficiency and ensure alignment with organizational goals. This is a requirement.

Option B (A customer service orientation): SSCs must prioritize service to internal clients (e.g., departments) and external stakeholders (e.g., vendors), ensuring smooth communication and issue resolution. This is a requirement.

Option C (A greenfield site): A greenfield site refers to a new facility built from scratch. SSCs can operate in existing offices, leased spaces, or even digitally, making a greenfield site unnecessary. This is the correct answer, as it is not required.

Option D (A change in mindset): Transitioning to an SSC requires employees and management to adopt a centralized, process-driven approach, moving away from decentralized silos. This cultural shift is a requirement.

Reference to IOFM APS Documents: The APS e-textbook underTechnology and Automationdiscusses SSCs as a way to “streamline AP through centralized processes, requiring performance metrics, a service-oriented approach, and a cultural shift to succeed.” It notes that SSCs can be established in various locations, with no mention of a greenfield site as a necessity. The training video highlights case studies of SSCs, emphasizing metrics and mindset changes but not physical site requirements.

TheTax and Regulatory Compliancetopic in the APS Certification Program includes understanding the Sarbanes-Oxley Act (SOX), enacted in 2002 to enhance corporate governance and financial reporting accuracy. SOX imposes strict requirements on public companies and holds individuals (e.g., executives, accountants) accountable for misconduct, such as falsifying financial records or obstructing audits. Violations can result incriminal penalties, including fines and imprisonment, depending on the severity of the misconduct.

Option A (Corporate dissolution): While SOX violations can lead to significant financial and reputational damage, corporate dissolution (complete closure of the company) is not a direct legal consequence specified in the Act. This option is incorrect.

Option B (Criminal penalties): SOX includes provisions for criminal penalties, such as fines up to $5 million and imprisonment up to 20 years for willful violations (e.g., falsifying records under Section 802). This is the correct answer.

Option C (Industry blacklisting): There is no formal “industry blacklisting” mechanism in SOX. While individuals may face reputational damage or debarment from certain roles, this is not a legal consequence. This option is incorrect.

Option D (Community service): SOX does not prescribe community service as a penalty for misconduct. Penalties are financial or custodial (fines, imprisonment). This option is incorrect.

Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Complianceexplains that “the Sarbanes-Oxley Act imposes criminal penalties, including fines and imprisonment, for misconduct such as falsifying financial records or obstructing audits.” Thetraining video discusses SOX’s impact on AP, noting that internal controls must prevent fraudulent reporting to avoid penalties under sections like 906 (certification of financial reports) and 802 (document tampering).

TheVendor Master Filetopic in the APS Certification Program emphasizes the importance of managing the vendor master file to prevent errors and risks. A key reason is toreduce the potential for fraud, as accurate and validated vendor data (e.g., TINs, addresses) prevents payments to fraudulent vendors and ensures compliance with regulations like OFAC.

Option A (Control the number of vendor calls): Not a primary reason. While a clean vendor master file may reduce inquiries, this is a secondary benefit, not a key focus.

Option B (Reduce the potential for fraud): Correct. Careful management, including TIN verification and sanction list checks, prevents fraudulent vendor setups and payments.

Option C (Monitor vendor quality): Vendor quality is typically assessed by Procurement or Operations, not the vendor master file, which focuses on data accuracy. Incorrect.

Option D (Gain visibility into payment status): Payment status is tracked in AP systems, not the vendor master file, which stores static vendor data. Incorrect.

Reference to IOFM APS Documents: The APS e-textbook underVendor Master Filestates, “Careful management of the vendor master file reduces fraud risk by ensuring accurate vendor data and compliance with validation processes.” The training video emphasizes, “A well-maintained vendor master file prevents fraud through rigorous verification, such as TIN matches and address checks.”

TheTax and Regulatory Compliancetopic in the APS Certification Program covers sales and use taxes, which are imposed on the sale or use of goods and services. In the U.S., sales and use taxes are levied bystatesand, in many cases,cities and towns(local jurisdictions). Thefederal governmentdoes not impose sales or use taxes, as this authority is reserved for state and local governments.

Item I (Cities and towns): Many cities and towns impose local sales taxes, often in addition to state taxes, to fund municipal services. This is a valid taxing authority.

Item II (Federal government): The federal government does not levy sales or use taxes; it imposes taxes like income or excise taxes. This is not a valid taxing authority for sales and use taxes.

Item III (States): States are the primary authorities for sales and use taxes, setting rates and rules for taxable transactions. This is a valid taxing authority.

Option A (II and III only): Incorrect, as Item II is not a valid taxing authority.

Option B (III only): Incorrect, as Item I is also a valid taxing authority.

Option C (I and III only): Correct, as only states and local jurisdictions (cities and towns) levy sales and use taxes.

Option D (I, II, and III): Incorrect, as Item II is not a valid taxing authority.

Reference to IOFM APS Documents: The APS e-textbook underTax and Regulatory Compliancestates, “Sales and use taxes are levied by states and local jurisdictions, such as cities and towns, but not by the federal government.” The training video discusses AP’s role in managing sales tax compliance, noting that “states and local governments set sales tax rates, while the federal government does not impose such taxes.”

Assumed receipt, also known as assumed receipt invoicing, is a process where payment is made based on the assumption that goods have been received, typically when receiving documents are not immediately available. This contrasts with processes like three-way matching, which require explicit confirmation of receipt. The term “Assumed Receipt” directly describes this practice, while “Positive Payment” and “Negative Assurance” are not standard terms in accounts payable for this context.

The web source from Tipalti explains: “Assumed receipt invoicing allows payments to be processed based on the purchase order and invoice, assuming goods have been received, often used to expedite payments when receiving data is delayed.” This aligns with the definition of assumed receipt as the process described in the question.

Positive Payment (I)is not a recognized term in accounts payable for this process.

Negative Assurance (II)is a term used in auditing, not accounts payable.

Assumed Receipt (III)is the correct term, making Option C the only accurate choice.

The IOFM APS Certification Program covers “Payments,” including various payment processes and their terminology. While the specific term “assumed receipt” is not directly quoted in the provided sources, the curriculum’s emphasis on “peer-tested best practices” includes understanding alternative payment methods, supporting the use of “Assumed Receipt” as the standard term.

TheVendor Master Filetopic in the APS Certification Program highlights vendor validation to prevent fraud, including checking addresses for red flags. A significant red flag is when avendor’s address matches one of the organization’s own locations, as this may indicate insider fraud (e.g., an employee creating a fake vendor using a company address).

Option A (The vendor has the same address as one of the organization’s own locations): Correct. This is a red flag, as it suggests potential fraud, such as an employee setting up a fictitious vendor at a company site.

Option B (The vendor does not appear to use a post office box): Incorrect. Not using a P.O. box is not inherently suspicious; many legitimate vendors use physical addresses.

Option C (The vendor’s warehouse and its accounts receivable address are different): Incorrect. Different addresses for operational and financial functions are common and not a red flag.

Option D (The vendor is located in an unincorporated area): Incorrect. Location in an unincorporated area is not inherently suspicious and does not indicate fraud.

Reference to IOFM APS Documents: The APS e-textbook underVendor Master Filestates, “A red flag during vendor address checks is when the vendor’s address matches an organization’s own location, indicating potential insider fraud.” The training video notes, “Always verify vendor addresses against company locations to detect fraudulent setups.”

In the context of technology and accounts payable, the acronymASPstands forApplication Service Provider, which refers to a third-party provider that delivers software applications over the internet, typically on a subscription basis. This is distinct from automated secure processing (Option A), accounting standards protocol (Option C), or accrual statement period (Option D), which are not standard terms in this context.

The web source from NetSuite states: “An Application Service Provider (ASP) delivers software applications over the internet, allowing businesses to access tools like AP automation without on-premises infrastructure.” This directly supports Option B.

The IOFM APS Certification Program covers “Technology and Automation,” including cloud-based and hosted software solutions like those provided by ASPs. The curriculum’s focus on “peer-tested best practices” aligns with understanding ASPs as a delivery model for AP tools.