Tips to Prepare for a Retirement Plan Audit
If you are about to undergo a 401K audit, there are many things that can be done to ensure that the audit goes smoothly. This means getting audit packages ready early on, being in contact with the individuals that are involved and following up on open items. When these simple steps are followed there will be greater efficiencies on your audit and each year they will get better and less burdensome.
Get in touch with your Auditors early on
It’s a good idea to contact your auditor 3 or 4 months prior to when you would normally have your audit scheduled. This way you can discuss fees, timing, and even go over things that went good or bad in the prior year, so if necessary the auditor can plan to revise the approach. Once you have contacted them and gone over these details you can schedule out the timing for the audit and this gives them time to get out any selections or requested items well before the audit. This way you can pull these items in advance and it doesn’t pile up in the last few days before the audit.
Contact your Custodian
Once you know the timing of your audit it is a good rule of thumb to reach out to your TPA 2 months prior to the audit. This way you can get access for the auditor and it helps the custodian plan for getting your audit package ready. Once you have given the auditor access and the audit package, the auditor can begin to make selections.
Get documents pulled prior to the arrival of Auditors
Once the auditor has given you their requests as well as the sample selections, start getting these items completed and pulled. It is in our nature to procrastinate and wait until we have to do something; however, this can really slow down the audit. The more items you can get completed prior to the auditor’s field work the better. There are many items that the auditor can begin to do from the office. This assists the auditor to properly prepare for the audit as well as to know what questions they may have for you while they are out conducting the audit.
Follow-up after the audit is complete
Finally, once fieldwork is complete follow-up to ensure that any remaining open items are complete. This will assist with getting the audit finalized and ready for issuance. If these items don’t get wrapped up quickly after the audit, it becomes difficult both for the client as well as for the auditor and custodian to be able to find the additional time to dedicate to the audit and can lead to inefficiencies and a dragged out audit.
Following these simple steps will create ease in your audit and you will notice that each year that these steps are followed the audit will become much easier!
By Brie Keckler
