Art of the Qualified Plan Audit

In Summary Designated Roth Accounts Contribution Rules: Participants in 401(k), 403(b), or 457(b) plans can make after-tax contributions to a designated Roth account. These contributions are combined with any pre-tax deferrals to count toward the annual limit ($23,500 in 2025). Unlike Roth IRAs, there are no income caps preventing high earners from contributing to their … Continued

In Summary Roth’s Vision: Senator Roth’s legacy continues through tax-free retirement innovation, as his creation of the Roth IRA in 1997 transformed retirement savings and inspired later Roth-style accounts like Roth 401(k), 403(b), and 457(b). Mandatory Roths Era: Rothification marks a shift toward mandatory after-tax contributions, beginning in 2026 when High Earners must make catch-up … Continued

  The Internal Revenue Service has announced adjustments on the limitations affecting retirement plans. In particular, participants can now elect to defer up to $23,500 to 401(k), 403(b), and 457(b) Plans in 2025 compared to $23,000 in 2024. Below is a chart that outlines updated employee benefit plan limits: PLAN LIMITS RETIREMENT & SOCIAL SECURITY … Continued

The Office of the Chief Accountant (OCA) in the Employee Benefit Security Administration (EBSA) of the Department of Labor (DOL) has released a 2023 Audit Quality Study covering the quality of audits being performed by independent qualified public accountants (IQPAs).  This is the fourth study to be performed with prior studies being performed in 2015, … Continued

In Summary ADP/ACP Testing Limits HCEs: Discrimination tests like ADP and ACP limit how much Highly Compensated Employees (HCEs) can defer to a plan. HCE deferral limits are directly tied to the average contribution percentage of Non-Highly Compensated Employees (NHCEs). Zero Contributions Impact Averages: All eligible employees, even those who contribute zero, must be included … Continued

Nervous apprehension tends to overwhelm new 401(k) audit clients who don’t know how involved they will need to be in the document production for the audit. Often, they are hopeful that one or more of their service providers will “take care of everything” as they promised. The bottom line is that the extent of the … Continued

Posted by Tyler Starr, CPA The American Institute of Certified Public Accountants’ (AICPA) Auditing Standards Board (ASB) issued the Statement on Standards for Attestation Engagements (SSAE) No. 19, Agreed-Upon Procedures Engagements, in December 2019. SSAE 19 supersedes SSAE 18 AT-C section 215 of the same name and also amends certain provisions of SSAE 18 section … Continued

Posted by Christopher J. Ciminera, CPA, QKA Update – April 29, 2020 On Wednesday, April 29, 2020 the Employee Benefits Security Administration (EBSA) also posted a Disaster Relief Notice 2020-01. In this notice, the EBSA provides relief to plan sponsors regarding the possibility of lags in deposits due to the recent COVID-19 issues which was … Continued

Posted by Christopher J. Ciminera, CPA, QKA A major change that comes with the passage of the SECURE (Setting Every Community Up for Retirement Enhancement) Act is a substantial increase in the penalty amounts imposed by the Internal Revenue Service (IRS) for a retirement plan’s failure to file a return. The increased penalty is part … Continued

Posted by Tyler Starr, CPA The passing of the Setting Every Community Up for Retirement Enhancement Act of 2019 (the SECURE Act) at the end of 2019 included significant changes impacting qualified retirement plans. In fact, the retirement plan industry has not seen such extensive changes in one act since the passing of the Pension … Continued