The FAT and even the FAT 32 file system have some limitation regarding the different attributes that the file can have. Fore example on the old FAT file system there is a limitation that doesn't let you to write files that have filenames exceeding certain numbers of characters etc. The FAT 32 is the most used for compatibility reasons, it improved FAT standard but still has it's limitations. (Lockup the specification on Wikipedia). exFAT has evolve from FAT 32 with superior attributes(ex. you can writer files bigger than 4 GB) (Useful wen recording video and the file becomes bigger than 4 GB), it's a substitute where the NTFS file system can't be use because of the device compatibility.
In the past i had some problems wile transferring files to the card using a sync application. I had some files that had long file names and because of the Fat 32 limitations the transfer ended with an error....
So if you use the card only in the phone and PC or other device that supports exFAT File System then I recommend formatting the card in the exFAT file System using the PC. For me this change increased the card stability and Z1 supports all those filesystems except NTFS. Take in mind that some USB CD players or Mp3 Players my not support exFAT and if you use those kind of devices you have to stick with FAT 32 which is widely compatible..
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