Expert’s Corner

The regulations and rules governing employer-sponsored retirement plans are typically complex and can be difficult to decipher. This is certainly the case when it comes to determining reasonable compensation for a plan advisor. The fees that may be charged by an advisor are governed by ERISA, and executed by the Department of Labor (DOL), ERISA’s enforcement arm.  With the recent revocation of the DOL’s conflict of interest final rule on fiduciary investment advice—AKA the Rule—this might seem confusing, as the…

Sometimes the number of entities with requirements for plan sponsors seems overwhelming.  In addition to keeping participants well served and satisfied, government regulatory agencies, such as the IRS, the DOL, ERISA—and now the SEC—have regulations and requirements that must be adhered to. For a long time, there were major differences between the requirements relating to 401(k) and 403(b) plans. In 2007, the IRS issued new regulations for 403(b) retirement plans. These regulations require more oversight and documentation from sponsors of…

The conflict of interest final rule on fiduciary investment advice—AKA the Rule—drew its last gasp on March 18th, when the 5th Circuit District Court vacated the regulations first introduced by the Department of Labor (DOL) in 2009. The 5th Circuit Court ruled that the DOL overreached its authority by placing rules on the investment industry, which includes insurance and annuity companies. The Court asserted that the states, not the DOL, were authorized by Congress to regulate insurance and annuity companies.…

The Investment Policy Statement (IPS) provides well-defined criteria and principles that enable prudent oversight of the retirement plan, and consistent, informed decision-making that keeps plan sponsors and the investment committee on track with the plan’s goals and processes.  Perhaps most importantly, the IPS evidences the plan sponsor’s fidelity to its fiduciary obligation, which is to act in the best interest of the plan’s participants ahead of its own. As such, an IPS serves as both a roadmap to plan success…

Given the complexity of 401(k) and 403(b) retirement plans, it’s not difficult for plan sponsors to trip up. Whatever the cause, missteps can be extremely costly—running from fines to plan disqualification—and government oversight is increasing. The results of a 2016 Willis Towers Watson survey of 300 U.S. retirement plan sponsors reveal that during the last two years, one in three retirement plans has been audited by the Internal Revenue Service (IRS) or Department of Labor (DOL). The audit rate for…

Since 2006, a raft of lawsuits have been filed by participants in both 401(k) and 403(b) retirement plans. Large corporations such as General Electric, Philips North America, Mutual of Omaha, and Home Depot have been sued in connection with perceived deficiencies in how they managed their 401(k) plans. Institutions of higher education are not immune from this onslaught. 403(b) lawsuit defendants are among the most prestigious institutions of higher education, including Brown University, Columbia University, Duke University, Emory University, University…

By Trisha Brambley, Founder of Retirement Playbook, Inc.™ Today, 75% of Plan Sponsors use the services of an Investment Advisor for their retirement plan[1]. Many of these plans (up to 75%) do not have a specialized Retirement Advisor while others may have outgrown the Advisor they do have. The providers too are seeing an increase in companies looking for that “best fit” Advisory Firm. A high quality firm can offer outstanding investment and retirement plan expertise. Plan Sponsors are looking…

By Ary Rosenbaum, Esq. The value of a good ERISA attorney is rooted in the fact that an independent ERISA attorney can serve as a check and balance on the other retirement plan providers. An independent ERISA attorney would keep an eye on the administrative practices of the TPA and whether the financial advisor is complying with the processes that they agreed to with the plan sponsor and trustees. As part of the retirement plan provider puzzle, an independent ERISA…

by David R. Dacey, CPA Company A’s employee benefit plan is undergoing an independent  audit of its financial statements. As part of that audit, the auditor reviewed a series of deposit transactions of employee withholdings of retirement 401(k) monies. The auditor selected eight transactions for review of a total of 24 transactions during the year.  For those transactions selected, the auditor noticed that the number of days to deposit the retirement plan withholdings ranged from a low of two business…

The regulations and rules governing employer-sponsored retirement plans are typically complex and can be difficult to decipher. This is certainly the case when it comes to determining reasonable compensation for a plan advisor. The fees that may be charged by an advisor are governed by ERISA, and executed by the Department of Labor (DOL), ERISA’s enforcement arm.  With the recent revocation of the DOL’s conflict of interest final rule on fiduciary investment advice—AKA the Rule—this might seem confusing, as the…

Sometimes the number of entities with requirements for plan sponsors seems overwhelming.  In addition to keeping participants well served and satisfied, government regulatory agencies, such as the IRS, the DOL, ERISA—and now the SEC—have regulations and requirements that must be adhered to. For a long time, there were major differences between the requirements relating to 401(k) and 403(b) plans. In 2007, the IRS issued new regulations for 403(b) retirement plans. These regulations require more oversight and documentation from sponsors of…

The conflict of interest final rule on fiduciary investment advice—AKA the Rule—drew its last gasp on March 18th, when the 5th Circuit District Court vacated the regulations first introduced by the Department of Labor (DOL) in 2009. The 5th Circuit Court ruled that the DOL overreached its authority by placing rules on the investment industry, which includes insurance and annuity companies. The Court asserted that the states, not the DOL, were authorized by Congress to regulate insurance and annuity companies.…

The Investment Policy Statement (IPS) provides well-defined criteria and principles that enable prudent oversight of the retirement plan, and consistent, informed decision-making that keeps plan sponsors and the investment committee on track with the plan’s goals and processes.  Perhaps most importantly, the IPS evidences the plan sponsor’s fidelity to its fiduciary obligation, which is to act in the best interest of the plan’s participants ahead of its own. As such, an IPS serves as both a roadmap to plan success…

Given the complexity of 401(k) and 403(b) retirement plans, it’s not difficult for plan sponsors to trip up. Whatever the cause, missteps can be extremely costly—running from fines to plan disqualification—and government oversight is increasing. The results of a 2016 Willis Towers Watson survey of 300 U.S. retirement plan sponsors reveal that during the last two years, one in three retirement plans has been audited by the Internal Revenue Service (IRS) or Department of Labor (DOL). The audit rate for…

Since 2006, a raft of lawsuits have been filed by participants in both 401(k) and 403(b) retirement plans. Large corporations such as General Electric, Philips North America, Mutual of Omaha, and Home Depot have been sued in connection with perceived deficiencies in how they managed their 401(k) plans. Institutions of higher education are not immune from this onslaught. 403(b) lawsuit defendants are among the most prestigious institutions of higher education, including Brown University, Columbia University, Duke University, Emory University, University…

By Trisha Brambley, Founder of Retirement Playbook, Inc.™ Today, 75% of Plan Sponsors use the services of an Investment Advisor for their retirement plan[1]. Many of these plans (up to 75%) do not have a specialized Retirement Advisor while others may have outgrown the Advisor they do have. The providers too are seeing an increase in companies looking for that “best fit” Advisory Firm. A high quality firm can offer outstanding investment and retirement plan expertise. Plan Sponsors are looking…

By Ary Rosenbaum, Esq. The value of a good ERISA attorney is rooted in the fact that an independent ERISA attorney can serve as a check and balance on the other retirement plan providers. An independent ERISA attorney would keep an eye on the administrative practices of the TPA and whether the financial advisor is complying with the processes that they agreed to with the plan sponsor and trustees. As part of the retirement plan provider puzzle, an independent ERISA…

by David R. Dacey, CPA Company A’s employee benefit plan is undergoing an independent  audit of its financial statements. As part of that audit, the auditor reviewed a series of deposit transactions of employee withholdings of retirement 401(k) monies. The auditor selected eight transactions for review of a total of 24 transactions during the year.  For those transactions selected, the auditor noticed that the number of days to deposit the retirement plan withholdings ranged from a low of two business…

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