Fundamental Payroll Certification

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History

Since its founding in 1982, the American Payroll Association (APA) has steadily grown. So much so that the organization has developed several standardized tests for payroll professionals to achieve national certification.[1] The APA argues that among every aspect of internal business operations, payroll is subject to the most government regulations. Moreover, due to the broadening scope of payroll and the complexity of the profession, providing payroll professionals a standardized test bestowing certification is appropriate. The Fundamental Payroll Certification exam (FPC) is designed to encourage professional growth, give recognition to payroll practitioners, and provide a standard of knowledge for the industry. The test was last updated in September of 2013 when the weight of each sub-section was altered.[2]

Function

FPC Study Guide

The FPC is open to anyone who desires to show basic competency in payroll, there are no prerequisites. The test is primarily intended for entry-level payroll professionals, financial consultants, sales people who deal with payroll operations and those who work with payroll software. Passage of this exam is a component of earning certification. The other requirement is agreeing to the APA Code of Ethics, though it should be noted that APA membership is not required to sit for the exam.[3]

Test Administration

FPC Flashcards

In order to take the test, one must fill out an application form and pay the $300 dollar exam fee. Once the application form is received, wait up to two business days for processing. At that point, you can schedule your exam date at a Pearson VUE testing center. The FPC is offered twice a year, once in September and again in late March. If an applicant needs special accommodations, then they should contact Pearson VUE, accommodations are considered on an individual basis.[4] On the day of the test, applicants should arrive thirty minutes early and bring with them two forms of identification. The test questions and format are determined by members of the APA’s Certification Board and the Certification Advisory Group. These groups continually study the test and make changes that they deem necessary. The exam is computerized and composed of 150 multiple-choice questions. 25 of these questions are not scored, as they are used only for statistical purposes. Test-takers do not know which questions do not count; therefore one should approach every question as if it counts. The test seeks to determine a person’s knowledge of payroll and the payroll environment.[5]

Test Format

Sections of the FPC Test
FPC Test Subject Areas Percentage
Core Payroll Concepts 40%
Compliance/Research and Resources 20%
Calculation of the Paycheck 22%
Payroll Process and Supporting Systems and Administration 2%
Disposition of Materials with Hazards 11.8%
Payroll Administration and Management 7%
Audits 5%
Accounting 4%

Test Environment

The current fee for the FPC Exam is $290.00. The time allotted for the testing period is three hours.[6]

Test Structure

The Fundamental Payroll Certification Exam consists of seven major content areas: Core Payroll Concepts; Compliance/Research and Resources; Calculation of the Paycheck; Payroll Process and Supporting Systems and Administration; Payroll Administration and Management; Audits; and Accounting. There are a total of 150 questions on this test, with three hours to complete them.[7]

Test Content

  • Sample Fundamental Payroll Certification Questions:
  1. Under the Fair Labor Standards Act (FLSA), an employer is bound to all but which of the following requirements?
    A. A minimum hourly wage
    B. Overtime pay
    C. Deductions for uniforms or tools of the trade
    D. Premium pay for work performed on a holiday
  2. Which of the following regulates how often employees must be paid by an employer?
    A. The Fair Labor Standards Act
    B. The individual state
    C. US Department of Labor
    D. National Labor Relations Act
  3. Which of the following is exempt from filing a Form I-9?
    A. An employee hired by a company before 1987
    B. An employee who provides in-home health care
    C. An employer with no control of how or when the work is performed
    D. Services provided under a contract dated after 1987
  4. Which type of flexible benefit plan provides compulsory coverage for key benefits?
    A. Cafeteria plan
    B. Core plus plan
    C. Traditional plan
    D. Modular plan
  5. Which is not a component of a financial statement?
    A. Balance sheet
    B. Income Statement
    C. Statement of changes in assets
    D. Statement of cash flow
  6. Which set of organizational activities would be most concerned with cash flow from debt?
    A. Financing activities
    B. Investing activities
    C. Operating activities
    D. Marketing activities

More free FPC practice test questions.

Scoring

In order to establish a sound and reliable scoring system, a panel of payroll professionals decides the score needed for passage. These individuals thoroughly study the exam and then settle on an acceptable score. Once a test-taker has completed the exam they will know their score.[8] If further score results are needed, possibly for a school or employer, test-takers should contact Pearson VUE.

Answers to Sample Questions

1:D; 2:B; 3:C; 4:B; 5:C; 6:A;

References

  1. ^ Richmond Chapter 16 March 2014
  2. ^ American Payroll Association 1 March 2014
  3. ^ Collin College 1 March 2014
  4. ^ Accommodations 16 March 2014
  5. ^ Fundamental Payroll Certification Handbook 1 March 2014
  6. ^ FPC FAQ 19 June 2014
  7. ^ FPC Content Outline 19 June 2014
  8. ^ Small Business Chronicle 1 March 2014