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AAP > Practice Test Questions of Focus 2 > Flashcards

Practice Test Questions of Focus 2 Flashcards

1
Q

Which entity is responsible for determining the effective date of ACH transactions?

A. Originator
B. Receiver
C. Operator
D. ODFI

A

A

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2
Q

What does the Originator Status Code signify in the ACH network, and which record contains this information?

A. Indicates the transaction type and is found in the entry detail record
B. Identifies the source of the transaction and is located in the batch header record
C. Denotes the processing priority and is included in the file header record
D. Specifies the transaction amount and is found it the addenda record

A

B

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3
Q

What is the total length of the Batch Number field in an ACH transaction, and which entity does it primarily represent?

A. 7 characters and represents the originator
B. 10 characters and represents the reciever
C. 15 characters and represents the ODFI
D. 8 characters and represents the ACH operator

A

A

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4
Q

In a batch that includes 40 credit transactions, 30 debit transactions, and 20 Addenda Records, what is the total Entry/Addenda Count for that batch?

A. 90
B. 100
C. 110
D. 120

A

A

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5
Q

An Origination Agreement will require an Originator to agree to be bound by the ACH Rules. This means the Originator must:

A. Obtain proper authorization from the receiver prior to initiating an entry
B. Pay fees to the ODFI for origination services
C. Communicate any new authorized user of OLB to the ODFI
D. Complete a risk assessment of its ACH activities

A

A

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6
Q

What is the maximum number of Correspondent Bank addenda records an IAT can contain?

A. 2
B. 9,999
C. 7
D. 5

A

D

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7
Q

In an IAT Entry resulting from a POP transaction, which Record and Field are responsible for carrying the Check Serial Number and Terminal details?

A. IAT Addenda Record for Pymt Related Info, Pymt Related Info Field
B. IAT Addenda Record for Remittance Info, Pymt Related Info Field
C. IAT Entry Record, Check Detail Field
D. IAT Addenda Record for Transaction Details, Transaction Reference Field

A

B

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8
Q

In which record of an IAT Entry can the OFAC Screening Indicators be located, and what do the values represent?

A. IAT Entry Detail Record: 0 - No Blocked Party, 1 - Blocked Party
B. IAT Entry Detail Record: 0 - No Blocked Party, 1 - Potential Blocked Party
C. IAT Summary Record: 0 - No Blocked Party, 1 - Blocked Party
D. IAT Summary Record: 0 - Potential Blocked Party, 1 - No Blocked Party

A

B

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9
Q

What is the maximum permissible dollar limit for a single ACH transaction as established by the NACHA rules?

A. $99,999,999.99
B. $1,000,000.00
C. $10,000,000.00
D. $500,000.00

A

A

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10
Q

In the context of ACH transactions, the Addenda Indicator can only be set to which of the following values?

A. 0
B. 1
C. 2
D. 3

A

0 or 1

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11
Q

This statement best describes how the Automated Clearing House Network (ACH) maintains its integrity as a processor of electronic payments

(Just Flip the Card)

A

The ACH network is a not-for-profit association and is regulated by its independence from outside interests

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12
Q

What is the purpose of a Death Notification Entry in the ACH network?

A. To initiate a pymt to a deceased person’s estate
B. To notify the ACH network of a customer’s death for record-keeping purposes
C. To cancel all pending transactions for a deceased person
D. To transfer funds from a deceased person’s acct to the gvmn’t

A

B

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13
Q

This statement is false about ACH transactions (flip card)

A

They typically involve digital cash

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14
Q

The ACH network primarily facilitates which type of transaction method, allowing for the electronic transfer of funds between financial institutions?

A. Debit/Pull
B. Credit/Pull
C. Credit/Push
D. Debit/Push

A

C

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15
Q

An Originator requests an Acknowledgement Entry be initiated by the RDFI by placing “AK” within which field?

A. Company Discretionary Data field of a credit CCD or CTX entry
B. Company Discretionary Data field of any credit entry
C. Discretionary Data field of any credit entry
D. Discretionary Data field of a credit CCD or CTX entry

A

D

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16
Q

For which ACH transaction types is the inclusion of the individual name field a requirement according to NACHA operating rules?

A. TEL & WEB
B. PPD & CCD
C. IAT & RCK
D. ARC & BOC

A

A

17
Q

A bank is evaluating the credit risk for a company seeking to optimize costs and originate a high volume of outgoing ACH payments. What is the BEST provision the bank should establish to control its credit exposure?

A. An intraday credit limit for the company
B. A limit on the number of items processed per day
C. An overdraft facility for the company
D. A standby letter of credit for the company

A

A

18
Q

A business wants to make Automated Clearing House (ACH) payments to a vendor, but the vendor refuses to use ACH unless the business submits each of the multiple invoices with the overall payment. This additional remittance information totals several records of up to 80 characters each. What sort of ACH payment format must the business use?

A. CTX
B. CCD+
C. PPD
D. RCK

A

B

19
Q

Which of the following specifically addresses the need to cover commercially reasonable security procedures between an ODFI and the Originator?

A. UCC 4A
B. OCC 2012-49
C. 31 CFR Part 210
D. FRB OC 4

A

A

20
Q

According to NACHA operating rules, which entity is responsible for establishing a written agreement with the originator of ACH transactions?

A. RDFI
B. ODFI
C. ACH Operator
D. Receiver

A

B

21
Q

Which of the following are best practices to help mitigate risk/fraud?
I. The use of dual authentication for all EFT transactions, where one person originates a transaction and a second person reviews and releases the transaction
II. Increase the number of non-repetitive wires when applicable
III. The use of a dedicated computer for the initiation of online EFT transactions
IV. The use of separate accounts for deposits and disbursements

A. I, III and IV only
B. I and III only
C. I, II, III and IV
D. III Only

A

A

22
Q

ACH Operating Rules primarily apply to:

A. US Treasury ACH Pymts
B. Private sector (commercial and consumer) ACH pymts
C. Consumer EFT payments
D. Corporate financial EDI pymts

A

B

23
Q

Blue Sky Bank has established ACH origination services for two local businesses and has provided the necessary disclosures as mandated by the NACHA operating rules. Under UCC Article 4A, which provision is subject to modification through mutual agreement, provided that the Originators are informed?

A. Liability for unauthorized transactions
B. Time of pymts
C. Choice of Law
D. Notice of Dishonor

A

A

24
Q

In ACH transactions, which of the following fields is required for all batches except for IAT entries?

A. Transaction amount
B. Company name
C. Receiver acct number
D. Pymt type

A

B

25
Q

In which ACH record is the transaction code specified that indicates the type of entry being processed?

A. Entry Detail Record
B. Bath Header Record
C. File Header Record
D. Addenda Record

A

A

26
Q

Which type of ACH entry is not mandated to include an addenda record?

A. CCD
B. PPD
C. IAT
D. WEB

A

A, B or D

27
Q

The Company Entry Description field of a commercial benefit payment being taken back by the Originator after death of the Receiver must contain:

A. RETRACT
B. REVERSAL
C. RECLAIM
D. RETRY PYMT

A

C

28
Q

In the event that an ODFI cannot settle ACH transactions originated in the ACH network, the ACH Operator can:

A. Create and transmit reversing entries to the affected RDFIs with the description REVERSAL in the batch header record
B. Create and transmit reversing entries to the affected RDFIs with the description NONSETTLED in the batch header record
C. Reject all the entries originated by the bank using the return code, R32 (RDFI non-settled)
D. Create an entry to the FI’s Fed Statement acct for the value of the non-settled entries

A

B

29
Q

For IAT entry, the RDFI number qualifier field would be located in which IAT addenda record?

A. Third IAT addenda record
B. Second IAT addenda record
C. Fifth IAT addenda record
D. The info is not included

A

C

30
Q

Where is the Transaction Type Code field found?

A. First IAT addenda record
B. IAT addenda record for Remittance Info
C. Second IAT addenda record
D. Third IAT addenda record

A

A

31
Q

In which record is the effective entry date for ACH transactions specified?

A. Company Batch Header Record
B. Entry Detail Record
C. File Header Record
D. Addenda Record

A

A

32
Q

In an ACH file, the batch header record is considered the _________________ record.

A. First
B. Second
C. Third
D. Last

A

B

33
Q

What function is not performed by the Federal Reserve’s Operating Circular No. 4 regarding ACH transactions?

A. Defines the roles of RDFI and ODFI
B. Establishes guidelines for ACH transaction processing
C. Sets forth the requirements for ACH transaction reversals
D. Regulations the timing of ACH settlement cycles

A

C

AAP (18 decks)

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