AAP Baseline Exam - Incorrect Answers Flashcards
Study questions answered incorrectly on baseline exam
How long is an RDFI required to retain a copy of a WSUD related to a returned entry?
One year
The Nacha Operating Rules require that each ACH Operator must retain a record of all entries for at least:
One year from transmittal of entry.
Which of the following is true relating to addenda records for an IAT (International ACH Transaction) entry?
7 mandatory, 2 optional remittance, 5 optional foreign correspondent (only a combined maximum of 12 addenda records)
If an Originator changes the scheduled debit date of an ACH entry, how many days in advance of the new date must the Originator provide notice to the consumer Receiver?
Seven calendar days
When is settlement considered final for ACH credit entries?
The day following the settlement date.
The Overall Return Rate Level is:
15%
An ACH Operator receives an ACH Credit item with a stale effective entry date. When will settlement occur?
The next available settlement opportunity.
How many CHARACTERS are in a block in a Nacha-formatted file?
940
Anthony opened his checking account with Northern Bank in February. In the initial disclosures provided by Northern Bank upon account opening, the ATM fee was clearly stated as being $3.00 per transaction. Effective October 1, the fee for using an ATM will increase to $3.50. According to Regulation E, how many days prior notice is required when there is a change to the initial disclosures which results in greater consumer liability?
21 Days
A transaction that posts to an account in real time may affect the balance available in the account immediately, however the posting may be temporary until the institution has completed all of the verification, balancing and reconciliation activities for:
Memo posting
An RDFI is required to make funds available in the Receiver’s account for credit Same Day Entries received in the third same-day processing window by:
The end of RDFI’s processing day.
The RDFI, upon receipt of the federal government’s Notice of Reclamation, has up to how many days to react to a Notice of Reclamation and prevent further withdrawals?
One business day
Community Financial Institution developed an ACH origination agreement for its business customers to sign. The Nacha Operating Rules require which of the following to be included in the agreement:
The financial institution’s restriction on the type of entries that may be originated.
Which arbitration procedure could be used in a dispute arising where a complaint asserts damages of $10,000 or more but less than $50,000?
Arbitration Procedure B
In an ACH file, which record contains the Company Name, the Standard Entry Class Code, and the Effective Entry Date?
Batch Header Record
True or False: ODFIs are required to originate Same Day ACH, but RDFIs can choose to receive Same Day ACH
False: ODFIs can choose to originate Same Day entries, but RDFIs are required to receive Same Day ACH.
A Financial Institution terminated a relationship with a Payments Processor, who they previously registered in Nacha’s Third-Party Sender Registry. The Financial Institution must update the registry within what timeframe following the termination of this relationship?
45 Days
The Company Name (all batches except IAT) is:
Mandatory
First Bank (the ODFI) is creating XCK entries due to a lost cash letter. According to the Nacha Operating Rules, First Bank needs to keep a copy of the item(s) to which each XCK entry pertains for:
6 years
Within what time frame must An ODFI reduce the Unauthorized Entry Return Rate of an Originator or Third-Party Sender below the Unauthorized Entry Return Rate Threshold after being instructed to do so by Nacha?
30 Days
As a prerequisite to origination, and to help control credit risk, an ODFI must have this in place for all the Originators for which it transmits ACH entries:
Exposure Limits
Great State Bank receives a notice from Nacha regarding reporting requirements for unauthorized returns for one or more Originators or Third-Party Senders (TPS) that Nacha suspects exceeded the threshold of 0.5 percent. Great State Bank must:
respond within 10 banking days via a traceable delivery method explaining the reason(s) causing the Originator or TPS to have exceeded the unauthorized entry return rate threshold.
A data element/segment requirement designator that indicates the presence of a specified data element is necessary to ensure processing.
Mandatory
An RDFI may choose to transmit a Notification of Change to an ODFI no later than what timeframe?
Within two Banking Days of the Effective Entry Date of the Entry to which the Notification of Change relates, except for Notifications of Change due to merger, acquisition, or other similar events.
If the effective entry date of a batch of entries is left blank by the
ODFI, the ACH Operator will insert the settlement date as:
the next available settlement opportunity
Which of the following statements is true about BOTH Same Day ACH and RTP?
Both have a $1,000,000 per transaction limit
Upon request of a Receiver, an RDFI must provide all payment-related information for CCD, CIE, CTX, and IAT entries to non-consumer accounts by:
The opening of business on the second banking day following the settlement date of the entry.
Fedwire Funds are final and irrevocable upon completion of processing by the:
Federal Reserve Banks
Per UCC 4A, a contract between a financial institution and a customer may limit liability to the bank unless:
The financial institution demonstrated “lack of good faith or failure to exercise ordinary care”
An Originating Depository Financial Institution (ODFI) may use which of the following tools to become aware of an Originator’s or Third-Party Sender’s past relationships with other ODFIs?
Terminated Originator Database
Which of the following is a characteristic of an eligible item for which an Originator could create an RCK Entry?
Amount less than $2,500
A data element/segment requirement designator that indicates the omission of this field may cause an entry to reject at the RDFI:
Required
A network that provides payment services directly to merchants and cardholders by the owner of the network without involving a third party as an intermediary is:
Closed Loop Payment System
