CECP Certified Executive Compensation Professional Exam Questions and Answers

Intrinsic

Extrinsic   

Possess a high level of education and competency in accounting principles

Determine which programs are crucial to the enterprise and which programs are expendable

Partner with multiple departments and external consultants and vendors

Demonstrate broad understanding of principles of financial management and business expertise

Compensation costs eventually stabilize and become a consistent percent of revenue.

Compensation costs and revenue increase at approximately the same rate.

Compensation costs eventually decrease as a percent of revenue, increasing profit growth.

Compensation costs remain the same as a percent of revenue until variable compensation costs exceed fixed compensation costs.

Salary

Piece rate

Hourly rate

Commissions   

The corporate mission

The business strategy

The compensation strategy

The corporate vision   

The balance sheet

The income statement

The cash flow statement and the income statement

The cash flow statement, along with the balance sheet and income statement

Compensation budgets only because staffing cannot exceed the funds available

A combination of organizational goals and budget realities

The consensus of HR management and line management estimates

The opinions of senior leaders in the organization

Additional quantitative analysis to determine whether pay rates are truly competitive or existing data are unreliable

Qualitative data collection to talk to key stakeholders and employees and determine whether the exit interviews accurately reflect their concerns

Qualitative data collection in the form of an employee survey with questions about employee satisfaction with pay levels

No additional data analysis is needed. Delta should increase pay rates based on the existing data to decrease turnover.

The level of formal education in each area

The ability to prioritize which is most critical in any given situation and allocate time and resources accordingly

The ability to tie them together, distill key messages and make impactful decisions

Effective interpersonal and communication skills that can overshadow minor deficiencies in any one area

It usually is a secondary consideration in compensation design.

It is the company's plan for competitive positioning of its products or services.

It must be written after the company's operating plans are approved by senior management.

It is developed for compensation, benefits and the work-life using the HR strategy as a basis.   

Because legal compliance with compensation-related regulations is the responsibility of the compensation department

Because the compensation professional has a fiduciary responsibility to ensure that the financial resources of their organization are spent in a prudent manner

Because it is possible to pay significantly less for talent in different countries and compensation should advise management on when and where to locate various jobs within the company

They shouldn’t. Due to the complexities of global regulations and practices, compensation administration outside of the home country should be outsourced.

They are based on a predetermined performance and reward schedule.

They are offered to motivate employee performance.

They are intended to align the interests of the employee with those of the organization.

They tend to make up the larger portion of an employee's total compensation.