How to Prepare for Your 401(k) Audit

There are a few simple steps that can be taken during the planning phase of the audit in order to gain efficiencies during the fieldwork phase. You should be in communication with your auditor before the Plan’s year-end date. This is the best time to come to an agreement about the terms, timing and fees …

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Full Scope vs. Limited Scope Audits

When a 401(k) or other retirement plan requires an annual audit, a plan administrator may have a choice to engage an audit firm to perform a full-scope audit or a limited scope audit of the financial statements. To be qualified for a limited scope audit, a bank or insurance carrier must act as a trustee …

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Enrollment Documentation

Did you know that one of the most common errors found in a 401K audit is due to a lack of proper documentation of enrollment? When a company is required to have their 401K plan audited it is a good idea to make sure that there are proper procedures as well as documentation in place …

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Questions to Ask When Selecting Auditors for Your Employee Benefit Plan

When an employee benefits plan such as a 401(k) plan reaches a certain size or qualifies under other requirements, the Department of Labor requires an audit to be performed. If you are selecting an audit firm for your employee benefits plan, you might consider asking the following questions: 1. How many employee benefit plan audits does …

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Where Should an Employer Look for Benefit Plan Fraud?

Employee benefit plans are often a side note in the day-to-day transactions of a business, lacking the constant oversight and review given to the operational activities.  Also, benefit plans involve the majority of the employees in a company in some way or another.  These and many other reasons make benefit plans susceptible to fraud.  As …

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10 Easy Tips to Prepare for Your 401(k) Audit

If your company’s 401(k) plan requires an audit this year, here are ten things you can do to help you prepare for, and pass your 401(k) audit. 1. Gather all plan documents including new amendments that were made during the current year.  Your auditor will ask for them, so you might as well pull them together …

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IRS Employee Plans Examination Process

In my previous blog, I discussed the oversight responsibilities of the IRS and Department of Labor over 401(k) plans, and what to expect if your plan is selected for an audit. One type of audit you may encounter is an IRS Employee Plan Examination, which is essentially designed to identify areas of noncompliance, develop corrective …

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Audit Requirements for Terminated Plan

As 401(k) auditors we are frequently asked “How long does a company have to have an audit for a plan that is terminated?”  Unfortunately as companies struggle during these tough economic times, plans are being terminated both as an effort to save costs or because the company has closed its doors.  As part of the …

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Footnote Disclosures

Another year end has passed and now you are probably compiling and sending the 401(k) files to your third party administrator for them to complete their compliance testing, and other plan financial reports.  Many of these documents will then be requested by your 401(k) plan auditor.  Additionally your auditor will be requesting other Plan documents …

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