The CARES Act (the “Act”) has been around for just over 3 months, providing much needed relief for retirement plan participants as they and their employers continue to navigate the pandemic. While this is good news for all involved, the provisions of the Act also create an opportunity for plan sponsors to evaluate the impact on their system of internal controls as they relate to the plan itself.Read More
The Internal Revenue Service (IRS) is focusing on internal control in auditing as the basis for determining the scope of the employee benefit plan audit. The IRS is concentrating on the various policies and procedures that are intended to govern the plan. A few of the areas being looked at are:Read More
Some of the major complexities of many qualified retirement plans result from the various subsidiaries and other entities that are part of the larger corporate parent. There are specific definitions within various regulatory provisions that need to be considered, including controlled group of corporations.Read More
When the decision is made to terminate a defined contribution plan subject to ERISA, an important consideration for the plan sponsor is how to locate missing participants in order to distribute their vested benefit under the plan.Read More
Inherent in any successful benefits strategy is awareness and action regarding the regulatory environment surrounding your employer-sponsored plans. Below, we have compiled a few reminders of upcoming regulatory deadlines:
All deadlines below assume a calendar plan year-end:
First Quarter 2019 (and beyond): Helpful Hints to Navigate
February 14: The Department of Labor’s regulations on fee disclosure include a requirement to issue certain disclosures to participants/beneficiaries by 45 days after each quarter-end for participant-directed DC plans.
o This disclosure is required for all participants with an account balance as of the end of the quarter.
o It is likely that your TPA handles this quarterly disclosure for you. However, this is a good opportunity to monitor the process in place at your TPA to ensure that these disclosures are being mailed out to participants in a timely manner.
Note: The DOL is continuing their scrutiny of compliance with these regulations and your fiduciary responsibility does not stop at assigning this task to your TPA, so be sure to maintain due diligence with this process!Read More
The threat of cybersecurity is nothing new these days. However, the threat continues to promulgate itself into more and more aspects of our daily life. From GPS systems to automobile computer systems to social media platforms, cybersecurity threats are continuing to evolve and will continue to inflict harm on the unprepared. And, employee benefit plans are no exception.Read More
The challenge of locating missing participants for benefits due to them under a qualified retirement plan is nothing new. However, an apparent new focus by auditors with the U.S. Department of Labor (DOL) regarding vested benefits under a defined benefit pension plan (DB) is making this challenge especially onerous and, potentially, costly.
The DOL has recently begun seeking out for audit inquiry those plans that have filed Form 5500s indicating large numbers of terminated vested participants. The data included on the census file may be focused on demographic and historical payroll data in order to provide for accurate benefit payment calculations. However, as time goes on, those components of the census may not change but mailing addresses can become obsolete very quickly after termination of employment and as time progresses beyond that date.Read More
The American Institute of Certified Public Accountants (AICPA) recently held their annual Employee Benefit Plans Conference. The conference provided information on current initiatives of the IRS and the DOL, as well as common findings noted based on their respective examinations and reviews of qualified plans.
In recent years, the IRS and DOL have indicated a focus on risk-based examinations and reviews, including identifying areas in plan operations where controls could be improved. As a result of these, they noted the following areas of focus:Read More
A Summary of Recent Standards Update (ASU 2015-12)
On July 31, 2015, the Financial Accounting Standards Board (FASB) announced an accounting standards update (ASU 2015-12) which directly addressed some disclosures normally required as part of the Plan’s financial statements. Normally, these pronouncements add disclosure requirements. But in much-heralded and much-appreciated turn, the new update reduces some of the more cumbersome and least informative of these disclosures.
The effective date of the ASU is for plan years starting after December 15, 2015 (so, effectively, 2016 calendar plan years). However, early adoption is permitted.
Here is a summary of some of the most relevant provisions of ASU 2015-12:Read More
As 2014 approaches its end, our attention naturally turns to reflection but also to planning for the coming new year. Inherent in any successful benefit plan strategy is awareness and action regarding the regulatory environment surrounding your employer-sponsored plans. Below, we have compiled a few reminders of upcoming regulatory deadlines:
All deadlines below assume a calendar plan year-end:
First Quarter 2015: Helpful Hints to Navigate
- January 31: When did you last apply for a determination letter from the IRS for your individually-designed qualified retirement plan? It may have already been 5 years! We advise that you contact your ERISA counsel and discuss what may be required of you: