Download APRP STUDY GUIDE 2026 COMPREHENSIVE QUESTION ANSWER DIGEST and more Exams Finance in PDF only on Docsity!
APRP STUDY GUIDE 2026 COMPREHENSIVE
QUESTION ANSWER DIGEST
โ Credit card. Answer: A card indicating the holder has been granted a line of credit to make purchases or withdraw cash up to a prearranged ceiling. โ Debit card. Answer: A payment card issued to a person for purchasing goods and services through an electronic transfer of funds from a demand deposit account (DDA) rather than using cash, checks drafts at the point of sale. โ Credit entry. Answer: An entry to the record of an account that represents the transfer or placement of funds into the account. โ Debit entry. Answer: An entry to the record of an account that represents the transfer or removal of funds from the account. โ Electronically Created Item (ECI).
Answer: A check that never appears in paper form. โ Remotely Created Check(RDC). Answer: Check created by a payee based on the account holder's authorization that does not bear a signature. โ Remote Deposit Capture (RDC). Answer: Delivery system that enables paper checks to be processed remotely. โ Pay Before. Answer: Type of retail processing where a card payment is made for goods or services with prepaid or stored-value cards, โ Pay Now. Answer: Type of retail processing where a card payment is expected when the goods or services are received; generally associated with debit payments(debit cards) โ Pay Later. Answer: Type of retail processing where a card payment is expected after the goods or services have been received; typically refers to credit payments(credit cards)
Answer: Financial institution identified in a funds transfer to be credited pursuant to the payment order. โ Federal Reserve Bank. Answer: Entity that process and settles Fedwire Funds โ Originating/Sender Bank. Answer: Financial Institution that initiates a funds transfer on behalf of the Originator. โ Originator. Answer: Sender of the payment order in a funds or securities transfer. โ Reconverting Bank. Answer: Financial institution that produces the substitute check or Image replacement documents(IRD) โ Truncating Bank. Answer: Financial institution that creates an image of the original check โ Corresponding Bank.
Answer: Private depository institution, Bankers Bank or Federal Reserve Bank providing clearing or settlement services to a paying Bank or Bank of First Deposit. โ Clearing House. Answer: A voluntary association of depository institutions that facilitate the clearing of checks or electronic items through the direct exchange of funds between members. โ Payor (Check Writer, Maker or Drawer). Answer: The party obligated to pay on a check โ Bank of First Deposit (Payee's Depository Financial Institution). Answer: The first bank to which a check is deposited or transferred. โ Payee. Answer: The party to whom a check is made payable โ Paying Bank (Payor's Depository Financial Institution). Answer: Financial institution identified by the routing number encoded on the MICR line of the check. โ POS/ATM/Credit Card Network.
โ ACH Operator. Answer: The central clearing facility for ACH transactions โ Receiving Depository Financial Institution (RDFI). Answer: A financial institution that receives ACH entries from ACH Operator and post entries to accounts of its depositors. โ Originating Depository Financial Institution (ODFI). Answer: A financial institution that receives payment instructions from Originators and forwards the entry to the ACH Operator. โ Receiver. Answer: an individual or company that has authorized an Originator to initiate an ACH entry to their account with the RDFI. โ Originator. Answer: A company or individual that has been authorized by the Receiver to initiate either a credit or debit ACH entry to their account โ Blockchain.
Answer: Uses algorithms to enable transactions to be aggregated in blocks, which are added to a chain of existing blocks using a cryptographic signature. โ Distributed Ledger Technology (DLT). Answer: A type of database that is consensually shared and synchronized across nodes in a network spread across multiple sides, institutions or geographies. โ International Organization for Standardization (ISO). Answer: An international standard-setting body composed of representatives from various national standards organizations. โ Value-added network (VAN). Answer: A hosted service offering that acts as an intermediary between business partners to transmit data (business documents). โ Electronic Data Interchange (EDI). Answer: the computer-to-computer exchange of business documents and payment related information in standard electronic format between business partners. โ Credit Analysis.
Answer: The highest-ranking executive in an organization responsible for making major corporate decisions, managing overall operations and resources, and acting as a main point of communication with the Board. โ Board of Directors. Answer: A group of individuals that are elected as, or elected to act as, representatives of the stockholders to establish corporate management-related policies. โ risk assignment. Answer: Form of risk sharing that allocates risk equitably. โ Risk Sharing. Answer: Form of risk treatment involving an agreed-upon distribution of risk with other parties. โ Risk Avoidance. Answer: Informed decision to withdraw from or not become involved with an activity to avoid exposure to unwanted or unacceptable risks. โ Risk Acceptance with treatment.
Answer: Risks that are monitored and reviewed to ensure they remain within the risk appetite. โ Risk Acceptance without treatment. Answer: Risk is accepted as tolerable and falls within the risk appetite. โ credit policy. Answer: Clear, written guidelines that set the terms and conditions for supplying services on credit, qualification criteria, procedures for making collections and steps to be taken in case of customer delinquency. โ Risk Acceptance. Answer: Informed decision to accept or take a particular risk. โ Business Continuity Plan(BCP). Answer: A comprehensive written plan to maintain or resume business in the event of a disruption. โ Business Impact Analysis (BIA). Answer: Process of identifying the potential impact of uncontrolled, non-specific events on an institution's business process.
โ Name the 5 steps in the vendor management lifecycle according to the FFIEC.. Answer: 1.Planning 2.Due Diligence in vendor selection 3.Contract Negotiation 4.Ongoing Monitoring 5.Termination โ Name the FTC'S "4 Ps" for evaluating whether a representation, omission, act or practice is likely to mislead.. Answer: 1.Prominent-will the consumer notice the information? 2.Presented-is the format easy-to-understand? 3.Placement-is the information located where a consumer would expect to look? 4.Proximity-is the information close to the claim in qualifies? โ Anomalous Activity. Answer: Activity that is inconsistent with or deviating from what is usual, normal or expected. โ Unfair, Deceptive or Abusive Acts or Practices(UDAAP). Answer: Law to protect consumers purchasing financial products and services requiring that consumers have access to information
that lets them choose the option they believe is best for their situation. โ Technical Controls. Answer: Controls to prevent and detect unauthorized activity. โ Procedural Controls. Answer: Controls that establish policies and procedures that reduce risk and ensure operating, reporting and compliance objectives are met. โ Administrative Controls. Answer: Controls that align with board-approved risk appetite and inform employees of management's expectations. โ Financial Controls. Answer: Controls to detect and/or prevent errors or misappropriations. โ At least annually, or more frequently depending on changes in the operating environment. Answer: Frequency in with an enterprise-wide business continuity tests should be conducted.
Answer: Step in the BCP process that identifies the potential impact of uncontrolled, non-specific events on an institutions business processes. โ Tabletop Exercise/Structured Walk-Through test. Answer: Testing method ensures critical personnel from all areas are familiar with the business continuity plan(BCP) and may be used as an effective training tool. โ Walk-Through Drill/Simulation Test. Answer: Testing method used to apply a specific event scenario to the business continuity plan. โ Functional Drill/Parallel Test. Answer: Testing method involves actual mobilization of personnel to other sites attempting to establish communications and perform actual recovery processing as outlined in the business continuity plan. โ Full-interruption/Full-Scale Test. Answer: Testing method involves a simulated real-life emergency and all or portions of Business continuity plan are implemented by processing data/transactions using back-up media at the recovery site.
โ Name of 4 steps included in business continuity plan.. Answer: 1. Business Impact Analysis 2.Risk Assessment 3.Risk Management 4.Risk Monitoring and testing. โ Card Payment System. Answer: Payment system governed by the Electronic Funds Transfer Act, Regulation Z, Card Association Rules, and Fair Credit Billing โ Wire Transfer Payment System. Answer: Payment system governed by UCC 4A, OFAC, Regulation J and Regulation CC โ ACH Network. Answer: Payment system governed by the ACH rules, UCC 4, UCC 4A, Electronic Funds Transfer Act, OFAC, Regulation E, The Right to Financial Privacy, Regulation D and Regulation CC โ Regulation J. Answer: Governs check collection through the Federal Reserve Bank and wire transfer
โ Commercial wholesale credits, including wire transfers and CCD/CTX credits. Answer: Transactions governed by UCC 4A โ Regulation CC. Answer: Implements the Expedited Funds Availability Act of 1987 โ Check Payment System. Answer: Payment system governed by the Expedited Funds Availability Act, UCC 3, UCC 4, OFAC, Regulation CC and Regulation J โ Regulation E. Answer: Implements the Electronic Fund Transfer Act (EFTA) โ Regulation Z. Answer: Designed to help consumers "comparison shop" for credit by requiring disclosures about terms and cost โ Office of Foreign Assets Control (OFAC). Answer: Administers economic sanctions and embargo programs that require assets and transactions involving the interest of targeted parties be blocked or frozen
โ Electronic Signatures in Global and National Commerce Act (E- Sign). Answer: Any agreement, authorization, Written Statement of Unauthorized Debit or other record that requires signatures or similarly authenticated methods may use an electronic signature in conformity with the terms of this Act. โ NACHA Operating Rules. Answer: Primary source of rules for the commercial ACH Network defining obligations and liabilities of Participating DFI. โ Gramm-Leach-Bliley Act (GLBA). Answer: Act, also known as the Financial Services Modernization Act of 1999, required federal banking agencies to establish information security standards for financial institutions. โ Bank Secrecy Act. Answer: A U.S. federal law that requires U.S. financial institutions and money services businesses (MSBs), which are entities that sell money orders or provide cash transfer services, to record, retain and report certain financial transactions to the federal government. This requirement is meant to assist the government in the investigation of money laundering, tax evasion, terrorist financing and various other domestic and international criminal activities.
