Analysis
of public Form 5500 reporting data reveals small 401(k) plans often outperform
large plans on a number of key metrics, says Judy Diamond Associates.
Annual filings always bring a swirl of activity, and
July 31 is no different. It also brings a cloud of confusion for plan sponsors,
according to Form 5500 mavens.
The Government Accountability Office (GAO) is
recommending that regulators consider modifying Form 5500 plan investment and
service provider fee information.
Summit Professional Networks has acquired Pension Data Resources, Inc. (PDR), known in the retirement planning industry for its PensionPlanet.com brand.
The majority of final Form 5500s reviewed during a
recent Internal Revenue Service (IRS) compliance assessment contained errors,
many related to undistributed assets.
It’s
well known that federal auditors look for red flags to target review efforts, but
one service provider says retirement plan advisers should use them for better business
planning.
Aggregated qualified retirement plan audit data from the Department of Labor (DOL) shows that, of the 3,677 investigations closed in 2013, violations were found nearly 73% of the time.
Retirement
advice professionals must confront some acute challenges in the months and
years ahead to ensure their ability to support clients—and grow their own firms—remains
intact.
Retirement plan sponsors can outsource much of the
work involved in filling out and filing annual Form 5500s, but they’re still
responsible for the results.
Small plans must be given more latitude to mimic their larger counterparts if the nation is to adequately fund its retirement needs, says Kristi Mitchem, of State Street Global Advisors.
Recent court cases are not the first efforts to try
to protect retirement assets for employees in plans that have been designated
as “church” plans by the Internal Revenue Service (IRS).
Northeast Professional Planning Group Inc. (NPPG) now offers ERISA 3(16) fiduciary services to assist plan sponsors in day-to-day administration and compliance efforts.
Six years may be a good document retention yardstick, but advisers
should warn their plan sponsor clients that it may not be right for retirement
plans.