Art of the Qualified Plan Audit

Posted by Maria T. Hurd, CPA, RPA Testing the work of a specialist in a retirement plan audit: How much expertise does the financial statement auditor need?   Service providers to the employee benefit plan (EBP) industry are often highly intelligent people that talk in “code”: Internal Revenue Code and ERISA Regulation sections. The legislation … Continued

Posted by Maria T. Hurd, CPA, RPA UPDATED 7/11/19 Tips and Traps of Compensation: Part I – The Trouble with True-Ups or Lack of True-Ups When 401(k) and 403(b) plans provide that the match contribution is calculated annually, but administratively, the deposit is done on a payroll by payroll basis, it is important for the … Continued

Posted by Maria T. Hurd, CPA, RPA The Truth Will Set You Free, but First, It Will Make You Miserable When it comes to reporting prohibited transactions (PT) with parties-in-interest, it’s better to come clean, confess, and report on the supplementary schedules to the audited financial statements than to deny any wrongdoing. Withholding information results … Continued

Posted by Maria T. Hurd, CPA, RPA A new auditing standard (expected to be issued in 2019), Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA (“Audit Standard” or “EBP SAS”) would be effective for audits performed starting in 2021 for plans with financial statement periods ending on or … Continued

Posted by Maria Hurd, CPA, RPA Updated May 22, 2019 First Things First: The Engagement Letter   The new audit standard, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA, effective for plan years ending on or after December 15, 2020, will require certain management representations as a pre-condition … Continued

Posted by Maria Hurd, CPA Disclaimer: All blog posts are valid as of the date published. In a highly regulated industry with complicated rules that always have exceptions (except when the exception does not apply) it is inevitable that sooner or later a failure to follow the plan document will take place. Such operational errors … Continued

In this world, nothing can be said to be certain, except death, taxes, and retirement plan operational errors. Two decades of plan audits have shown time and time again that even the most accurate plan sponsor is not immune from making one of the common errors.

By special request, following is a summary of the basic available safe harbor formulas, with no extra editorials. See bullet points for information about enhanced match opportunities.

When auditors identify operational errors, clients and service providers often ask whether we can ignore them since they are immaterial to the financial statements. 

In response to the DOL’s findings regarding ERISA plan audit deficiency rate, the AICPA has embarked on an initiative to improve audit quality