Employee Benefit Plan Audit Quality Center EBPAQC 403(b) Plan Audits Live Forum Webinar...

Employee Benefit Plan Audit Quality Center

EBPAQC 403(b) Plan Audits Live ForumWebinar Troubleshooting Tips

Disable all pop-up blockers on your computer You should be able to hear music, if not, you may need to do

one of the following: Verify that the volume on your computer is not muted If you are in Windows Media Player, please logout and try Real

Player If you are in Real Player, please logout and try Windows Media

Player Most often any audio or video difficulties are at the local user

office so you may need to check with your IT administrator If you are still having difficulties, please let us know by typing

your problem in the question box on the left hand side, and a Genesys representative will assist you

1

2

EBPAQC Live Forum

403(b) Plan Audits

Update

June 10, 2010


3

Panelists

Marilee Lau

Marilee Lau CPA

Bob LavenbergBDO Seidman LLP

Debbie SmithGrant Thornton LLP

Tim DesmondO’Connor Davies Munns &

Dobbins LLP

Lynne McMennaminMcGladrey & Pullen LLP


CPE Credit For Participating

Must have registered for CPE credit prior to this live forum• CPE Credit Approval Form posted on webinar instruction site

Listen for announcement of 4 CPE codes (7 digits: ALL_ _ _ _ ) and 4 polling questions during the live forumRecord CPE Codes on CPE Credit Approval Form (no need to record polling questions)Return completed form (by fax or mail) to AICPA Service Center for record of attendanceKeep a copy of completed CPE Credit Approval Form for your records

4


Introduction

Marilee Lau, CPAChair

EBPAQC Executive Committee

5


6

Objectives

Available 403(b) plan audit resources

General considerations- client acceptance, fees, opening balances, etc.

Impact of reporting relief in DOL Field Assistance Bulletins 2009-02 and 2010-01

Impact of DOL Advisory Opinion 2010-10A on reporting certain insurance contracts

Initial audit considerations- engagement letter, special audit considerations

Financial statements and disclosures

Audit reports

SAS 115 communicationsAICPA FAQs on 403(b) Plan AuditsQuestions and answers


Previous EBPAQC 403(b) Plan Audits Live Forum- November 6, 2008 • basic understanding of 403(b) plans• similarities to and differences from 401(k) plans • which plans are ERISA-covered• new DOL reporting and audit requirements• implementation issues• initial steps to take

EBPAQC members can listen to the archived event and view the presentation materials at the EBPAQC web site.

403(b) Plan Audit Resources

7


EBPAQC 403(b) Plan Audit Resource Center

On the EBPAQC web site

• 403(b) Plans Primer• 403(b) Filing and Audit Requirements • 403(b) Getting Started: Meeting the New Form 5500

Reporting and Audit Requirements• 403(b) Questions to Expect from Your Plan Auditor• 403(b) Sample Auditor Request List for Plan Information• 403(b) Retirement Plan Audits-Frequently Asked Questions

Share these with your plan clients!


8


AICPA Audit Risk Alert Employee Benefit Plans Industry Developments – 2010 (Audit Risk Alert)

• overview of 403(b) plans• pertinent Internal Revenue Service (IRS) regulations • Department of Labor's (DOL) Field Assistance Bulletins related

to 403(b) enforcement relief• significant differences between 401(k) plans and 403(b) plans• client acceptance and continuance• engagement letter• initial audit considerations• example audit reports

Available at AICPA Store at CPA2Biz.com


9


U. S. Department of LaborDOL EBSA 403(b) Website- http://www.dol.gov/ebsa/403b.html

Employee Benefit Security Administration's (EBSA) toll-free Form 5500 help desk is available from 8:00 am to 8:00 pm, Eastern Time, at 1-866-GO-EFAST (866-463-3278)

Questions concerning the information contained in the Field Assistance Bulletins may be directed to the DOL's Division of Coverage, Reporting and Disclosure at 202-693-8523

Questions concerning individual plans facing specific transition issues should be directed to EBSA's Office of the Chief Accountant at 202-693-8360


10

http://www.dol.gov/ebsa/403b.html


Internal Revenue Services (IRS)IRS Web site on IRC 403(b) Tax-Sheltered Annuity Plans at http://www.irs.gov/retirement/article/0,,id=172430,00.html

IRS Publication 571 Tax-Sheltered Annuity Plans (403(b) Plans) (Rev. November 2007) Cat. No. 46581C http://www.irs.gov/pub/irs-pdf/p571.pdf

Other IRS Publications:

Pub. 4482, 403(b) Tax-Sheltered Annuity for Participants

Pub. 4483, 403(b) Tax-Sheltered Annuity Plan for Sponsor

Pub. 4484, Choose a retirement plan for employees of tax-exempt and government entities (schools, hospitals, churches, charities)

Pub. 4530, Designated Roth Accounts under a 401(k) or 403(b) Plan

Pub. 4546, 403(b) Plan Checklist

Pub. 4547, Have you had your check-up this year? for 403(b) Retirement Plans


11

http://www.irs.gov/retirement/article/0,,id=172430,00.html

http://www.irs.gov/pub/irs-pdf/p571.pdf

http://www.aicpa.org/Redirect/SendUserToExternalSite.aspx?url=http://www.irs.gov/pub/irs-tege/pub4482.pdf&sitecode=0

http://www.aicpa.org/Redirect/SendUserToExternalSite.aspx?url=http://www.irs.gov/pub/irs-tege/p4483.pdf&sitecode=0

http://www.aicpa.org/Redirect/SendUserToExternalSite.aspx?url=http://www.irs.gov/pub/irs-pdf/p4484.pdf&sitecode=0


http://www.aicpa.org/Redirect/SendUserToExternalSite.aspx?url=http://www.irs.gov/pub/irs-tege/pub4546.pdf&sitecode=0


General Considerations and DOL Reporting Relief

Bob Lavenberg, CPA

Partner

BDO Seidman LLP

Chair

AICPA 403(b) Plan Audit Joint Task Force

12


Universal availability

Vendors

Custodial accounts

90-24 transfer

Excludable contracts

403(b) Plan Environment

13


Considerations Relating to Client Acceptance, Fees, Opening Balances

Vendors• How many now• Any others in the past• Internal controls• Historical records• 90-24 transfers

History of PlanAge of Plan Organizational Factors• Tone at the top• Attitude towards compliance • Internal controls• Historical records• Vendors and vendor

selection• Dedicated staff – not just

how many – but who• Budget – internal & external• Understanding/attitude

about audit opinion

14


Field Assistance Bulletin (FAB) 2009-02

DOL FAB 2009-02 allows the plan administrator to exclude certain pre-January 1, 2009 annuity contracts and custodial accounts for ERISA reporting purposes. Must meet all of these criteria:

1. the contract or account was issued to a current or former employee before January 1, 2009;

2. the employer ceased to have any obligation to make contributions (including employee salary reduction contributions), and in fact ceased making contributions to the contract or account before January 1, 2009;

3. all of the rights and benefits under the contract or account are legally enforceable against the insurer or custodian by the individual owner of the contract or account without any involvement by the employer; and

4. the individual owner of the contract is fully vested in the contract or account.

15


FAB 2009-02 (CONT)

The plan sponsor will need to ensure that the four criteria have been met in order for them to be properly excluded

The FAB allows but does not require that contracts and/or accounts be excluded

Contracts/accounts that do not meet all of the four criteria may not be excluded

Contracts/accounts that are excludable under the FAB may also be excluded from the comparative (2008) financial statements included in the 2009 Form 5500

16


FAB 2009-02 (CONT)

DOL’s expectation is for a “good faith” effort to comply with the ERISA annual reporting requirements

Some vendors will not be in a position to exclude contract or account information that meets the criteria

The FAB applies to both large and small plans

The FAB also applies to years beyond 2009

Current or former employees with contracts excludable under this relief are not counted as participants

Note: This does not change the IRS’s Universal Availability Rule

17

FAB 2009-02- Auditor considerations

If plan sponsor elects to exclude certain pre-2009 contracts or accounts…

Need to consider

• Effect on completeness of the financial statement presentation

• Effect of restrictions on the scope of the audit

Some sponsors may not find a qualified, adverse or disclaimer of opinion acceptable

18



Will likely have to issue a modified audit report

• Scope limitation

• GAAP departure

• Or both!

DOL will not reject a 403(b) plan Form 5500 on the basis of a qualified, adverse or disclaimed opinion if the accountant expressly states that the sole reason for such an opinion was because such pre-2009 contracts and accounts were not covered by the audit or included in the plan’s financial statements

19



ERISA and DOL regulations require the audit to be performed in accordance with Generally Accepted Auditing Standards (GAAS) – requiring all plan assets to be reported

Need to audit the information that is available

Cannot limit test work because of a scope limitation or because a modified report (disclaimer, adverse, etc.) will be issued

Regardless of the type of opinion issued,

the auditor is still required to complete all other GAAS audit procedures (e.g.- contributions, distributions, etc.)

20


FAB 2010-01, Annual Reporting and ERISA Coverage for 403(b) Plans

Issued February 17, 2010

Provides additional guidance in a Frequently Asked Questions (FAQ) format

Confirms that if, as a result of applying FAB 2009-02, the number of eligible participants is below 100, then the plan becomes a small filer

Affirmed that the limited scope exemption is available, but make sure that all requirements are met and that properly certified statements are obtained from all vendors

Acknowledged that the inability of the auditors to obtain sufficient evidence is a restriction on scope of audit, and opinion may be modified accordingly

21


FAB 2010-01 (CONT)

States that if, as part of the audit the auditor was engaged to perform, the auditor discovers that contracts were incorrectly excluded under DOL FAB 2009-02 from the plan’s financial statements, the DOL expects that the auditor will alert the plan administrator.

Plan administrators have an obligation to take reasonable steps to resolve questions concerning the exclusion of such contracts in their annual report.

If the plan administrator and auditor do not agree with how to resolve issues relating to excluded contracts, the DOL expects these issues to be noted in the audit report.

22

DOL Advisory Opinion and Initial Audit Considerations

Debbie Smith, CPA

Partner

Grant Thornton LLP

23


DOL Advisory Opinion (AO) 2010-10A

Issued March 4, 2010- Addresses Traditional Annuities issued by TIAA-CREF

Allocated vs. Unallocated insurance contracts?

DOL concluded the contracts are UNALLOCATED• For plan years beginning on or after 1/1/09 must be reported as

plan assets on the Form 5500• DOL will not reject (or require amended) Form 5500 for plan years

ending in 2008 or prior which contain a modified opinion due to exclusion of these contracts from plan assets

What about similar contracts with other insurance companies?

24


25

DOL Advisory Opinion (AO) 2010-10A-Audit/5500 Considerations

Depends on facts and circumstances• Financial Statements

- Could be an error- May require restatement of financial statements- Modified opinion- Reconciliation to the 5500

Form 5500• Will not have to restate or amend• Treat the contracts as a transfer in for the 2009 Schedule H

26

Allocated ContractsEmerging Technical Issues

FASB Definition (FASB Codification Master Glossary)-• A contract in which an insurance entity unconditionally

undertakes a legal obligation to provide specified pension benefits to specific individuals in return for a fixed consideration or premium. An annuity contract is irrevocable and involves the transfer of significant risk from the employer to the insurance entity.

Allocated=not recognized as a plan asset Unallocated=recognized as a plan asset

Read insurance contracts and supporting documentation to determine appropriate classification of the contract


Initial Audit Considerations

Engagement letter • Scope of services

- Any client-imposed scope restrictions?- Excluded contracts per DOL FAB?- Limited scope audit under 29 CFR 2520.103-

8?• Auditor responsibility for prior year (comparative)

statement of net assets available for benefits?- Audit, review, compilation?

27


Initial Audit Considerations

Make inquires of the plan administrator and outside service providers, as applicable, regarding the plan’s operations during those earlier years

Obtain relevant information (for example, plan and /or participant level statements, recordkeeping reports, reconciliations, minutes of meetings, and SAS No. 70 reports) for earlier years, as applicable, to determine whether any errors were noted during those years that could have a material effect on current year balances

Gain an understanding of the accounting practices that were followed in prior years to determine that they have been consistently applied in the current year

28


Initial Audit Considerations- Comparative Statements of Net Assets

Comparative statements of net assets available for benefits required by ERISA

Apply procedures that are practicable and reasonable in the circumstances to obtain assurance that the accounting principles used by the plan in the current and the preceding year are consistent

See paragraphs .24–.25 of AU section 420, Consistency of Application of Generally Accepted Accounting Principles (AICPA, Professional Standards, vol. 1), for further guidance

29


Initial Audit Considerations-Risk Assessment Procedures

Need to perform procedures over the completeness and accuracy of participant level information

Assets are not held in “trust” but in individual annuity contracts or custodial accounts rather than in the plan’s name

Risk assessment may need to consider condition of records and internal controls over multiple vendors

Planning the nature, timing, and extent of further audit procedures depends on the outcome of the auditors risk assessment procedures.

See paragraph .42 of the 2010 EBP Audit Risk Alert

30


Initial Audit Considerations-Areas of Special Consideration

31

Completeness of participant data and recordsParticipant eligibilityAmounts and types of benefitsEligibility for benefitsAccount balances

The nature, timing, and extent of auditing procedures applied by the auditor are a matter of judgment and will vary with factors such as the adequacy of past records, the significance of beginning balances, the complexity of the plan's operations, and controls covered by SAS No. 70 reports.

See paragraph 5.90 of AICPA Audit and Accounting Guide Employee Benefit Plans

Numerous Audit Risk Factors Size of plan and number of years in existence

Adequacy and organization of critical plan documents

Incomplete or missing records (participant data, payroll, etc.)

Disaggregation and completeness of recordkeeping information

Identifying all current and former participant accounts to be included as plan assets• “Missing” participants• “Orphan” contracts

Multiple service provider concerns

Adequacy of internal controls • Fiduciary oversight• Availability of SAS No. 70 reports• Monitoring controls

Regulatory compliance matters

Investment valuation and reporting

Fraud risks

See paragraph .42 of the 2010AICPA EBP Audit Risk Alert

32

Typical Compliance Issues

Late deposit of participant deferrals & loan repayments

Failure to properly apply plan’s definition of compensation

Failure to update plan document

Failure to follow plan’s eligibility provisions

Incorrect employer contributions

Failure to properly apply plan’s vesting provisions

Improper use of plan forfeitures

Failure to comply with Form 5500 filing requirements

33

Financial Statements and Disclosures

Tim Desmond, Partner

O’Connor Davies

Munns & Dobbins

34


403(b) Financial Statements and Disclosures

403(b) plans are considered a type of defined contribution plan.

2010 EBP Audit Risk Alert notes that the financial statements and disclosures would be similar to those described in chapter 3 (and appendix E) of the AICPA Audit and Accounting Guide Employee Benefit Plans.

• Comparative Statement of Net Assets Available for Benefits (2009/2008)

• Current year Statement of Changes in Net Assets Available for Benefits

• Similar disclosures as for a 401(k) plan

35



403(b) plans would make all of the appropriate footnote disclosures that apply to 401(k) plans (e.g.- FASB ASC 820 investment fair values, insurance contracts, etc.)

Consideration should be given concerning which disclosures may need to be modified or added. • For example, the general description of the plan, eligibility

requirements, funding, and tax status should reflect the requirements of the 403(b) plan document.

Note: The IRS has not yet established a process for issuing determination and opinion letters for 403(b) plans

Additional or modified disclosures of the accounting policies surrounding the accounting treatment of certain contracts under DOL FAB 2009-02 may be necessary

36


37


“Loans to participants” vs. “Participant loans”

Loans to participants are made by the vendor and are secured by the participant’s individual account balance (plan assets)

Participant loans are made by the plan

Loans to participants are not currently on the plan’s financial statements or the Form 5500

Need to consider additional disclosure in the footnotes of collateralized plan assets

DOL is considering additional guidance

Stay tuned!


Auditor Reports

Marilee Lau, CPA

38

39

Auditor Reports

What type of audit report will be issued?

• Depends on the auditor’s professional judgment

• Whether sufficient appropriate audit evidence has been obtained to form an opinion

• Could be unqualified, qualified, adverse or disclaimer of opinion

Authoritative guidance

• AU section 508, Reports on Audited Financial Statements

• AU Section 551, Reporting on Information Accompanying the Basic Financial Statements in Auditor-Submitted Documents

Auditor Reports

Many reports will be disclaimers• Not limited-scope disclaimers as permitted by 29 CFR 2520.103.8 • “Real” disclaimers

Concerns over completeness of reported information• Can excluded contracts that are “excludable” under the FAB be

quantified?• Are the “excludable” contracts material to the financial statements• Not auditing their “good faith effort”

Other anticipated scope restrictions (records issues, certified investment information, etc.)

40

41

Auditor Reports

The limited scope audit opinion allowed by the DOL under 29 CFR 2520.103-8 may not be appropriate

Opinion on the supplemental schedules would be the same opinion as for the report—reference to compliance with the DOL’s rules and regulations as to form and content would not be appropriate

42

Auditor Reports

Fact Pattern #1

• The plan administrator is not able to determine the amount or materiality of the excluded assets due to the lack of records

• Disclaimer of opinion

Example opinions based on specific fact patterns when contracts or accounts are excluded as permitted by DOL FAB 2009-2


Illustrative Auditor Report- Fact Pattern #1- Disclaimer of Opinion

43

[Excerpts – second, third and fourth paragraphs]

The Plan has not maintained sufficient accounting records and supporting documents relating to certain annuity and custodial accounts issued to current and former employees prior to January 1, 2009. Accordingly, we were unable to apply auditing procedures sufficiently to determine the extent to which the financial statements may have been affected by these conditions.

As described in Note X, the Plan has excluded from investments in the accompanying statement of net assets available for benefits certain annuity and custodial accounts issued to current and former employees prior to January 1, 2009, as permitted by the Department of Labor's Field Assistance Bulletin No. 2009-02, Annual Reporting Requirements for 403(b) Plans. The investment income and distributions related to such accounts have also been excluded in the accompanying statement of changes in net assets available for benefits. The amount of these excluded annuity and custodial accounts and the related income and distributions are not determinable. Accounting principles generally accepted in the United States of America require that these accounts and the related income and distributions be included in the accompanying financial statements.

Since we were not able to apply auditing procedures to satisfy ourselves as to the appropriateness and completeness of the Plan's net assets available for benefits and changes in net assets available for benefits as of December 31, 2009 and 2008, and for the year ended December 31, 2009, the scope of our work was not sufficient to enable us to express, and we do not express, an opinion on these accompanying financial statements

Source- 2010 AICPA EBP Audit Risk Alert.

44

Auditor Reports

Fact Pattern #2 • Plan administrator has elected the limited scope audit

exemption and has also elected to exclude certain contracts and accounts. The amounts of the excluded contracts or accounts are determinable and are material.

• Disclaimer of opinion



Illustrative Auditor Report- Fact Pattern #2- Limited Scope Disclaimer of Opinion

45

[Excerpts – second, third and fourth paragraphs]

As permitted by 29 CFR 2520.103-8 of the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974, the plan administrator instructed us not to perform, and we did not perform, any auditing procedures with respect to the information summarized in Note X, which was certified by ABC Bank, the trustee (or custodian) of the Plan, except for comparing such information with the related information included in the financial statements and supplemental schedules. We have been informed by the plan administrator that the trustee (or custodian) holds the Plan's investment assets and executes investment transactions. The plan administrator has obtained a certification from the trustee (or custodian) as of December 31, 2009 and 2008 and for the year ended December 31, 2009, that the information provided to the plan administrator by the trustee (or custodian) is complete and accurate.

As described in Note X, the Plan has excluded from investments in the accompanying statement of net assets available for benefits certain annuity and custodial accounts issued to current and former employees prior to January 1, 2009, as permitted by the Department of Labor's Field Assistance Bulletin No. 2009-02, Annual Reporting Requirements for 403(b) Plans. If the identified contracts, as reported by the custodian, were included, net assets available for benefits would increase by approximately $XX and $XX as of December 31, 2009 and 2008, respectively. Further investment income of approximately $XX and distributions of approximately $XX related to such accounts, as identified by the custodian, have also been excluded in the accompanying statement of changes in net assets available for benefits for the year ended December 31, 2009. Accounting principles generally accepted in the United States of America require that these accounts and the related income and distributions be included in the accompanying financial statements.

Because of the significance of the information that we did not audit, the scope of our work was not sufficient to enable us to express, and we do not express, an opinion on the accompanying financial statements and supplemental schedules taken as a whole.


46

Auditor Reports

Fact Pattern #3

• Amounts of excluded assets are determinable and material to the financial statements

• Adverse opinion



Illustrative Auditor Report- Fact Pattern #3- Adverse Opinion

47

[Excerpts – third and fourth paragraphs]

As described in Note X, the Plan has excluded from investments in the accompanying statement of net assets available for benefits certain annuity and custodial accounts issued to current and former employees prior to January 1, 2009, as permitted by the Department of Labor's Field Assistance Bulletin No. 2009-02, Annual Reporting Requirements for 403(b) Plans. If the identified contracts, as reported by the custodian, were included, net assets available for benefits would increase by approximately $XX and $XX as of December 31, 2009 and 2008, respectively. Further investment income of approximately $XX and distributions of approximately $XX related to such accounts, as identified by the custodian have also been excluded in the accompanying statement of changes in net assets available for benefits for the year ended December 31, 2009. Accounting principles generally accepted in the United States of America require that these accounts and the related income and distributions be included in the accompanying financial statements.

In our opinion, because of the effects of the matters discussed in the preceding paragraph, the financial statements referred to above do not present fairly, in conformity with accounting principles generally accepted in the United States of America, the net assets available for benefits of the Plan as of December 31, 2009 and 2008, and the changes in its net assets available for benefits for the year ended December 31, 2009.


SAS 115 Communications and AICPA 403(b) Plan Audit FAQs

Lynne McMennamin

McGladrey & Pullen, LLP

48


SAS 115 Communications

• Material weaknesses and significant deficiencies?- Oversight of the financial reporting process - Internal control over financial statement

preparation and review - Financial statement knowledge - Missing records- Monitoring active/inactive accounts

49


AICPA 403(b) Retirement Plan Audits- Frequently Asked Questions (FAQs)

12 FAQs issued in March 2010 (EBPAQC EAlert # 200)

FAQs emphasize that ERISA requires plan auditors to follow professional standards and report on whether the plan's financial statements are consistent with generally accepted accounting principles (GAAP), even though the DOL enforcement relief allows plans to exclude contracts and accounts that meet the FAB criteria

FAQs also discuss:

• client-imposed audit scope restrictions

• initial audit procedures on beginning of year balances

• audit procedures applied to comparative statements of net assets available for benefits

• insufficient historical records

• audit report modifications

• plan investment fair value measurement

50


AICPA 403(b) Retirement Plan Audits- Frequently Asked Questions (FAQs)

FAQs should be considered in light of the particular facts and circumstance of each plan

Several factors can affect the scope of the audit, audit procedures performed, and the form of the auditor’s report, including, but not limited to • whether the plan administrator excludes contracts and accounts

from the plan’s financial statements that meet the requirements of FAB 2009-02,

• whether the plan administrator elects the limited scope audit exemption in accordance with ERISA,

• whether historical records exist and are available for reported contracts and accounts, and

• whether the plan has one or multiple vendors during the existence of the plan.

51


403(b) Retirement Plan Audits- Frequently Asked Questions (FAQs)

1. Does the DOL enforcement relief change the requirement to have an independent audit of the plan’s financial statements?

2. Does the DOL enforcement relief change the auditor’s responsibility to perform a financial statement audit?

3. Can the plan administrator of a 403(b) plan elect the limited scope audit exemption in accordance with DOL regulation 29 CFR 2520.103-8?

4. If the plan administrator excludes some contracts or accounts from the plan’s financial statements that meet the requirements of FAB 2009-02, and the plan administrator elects the limited scope audit exemption as permitted by DOL regulation 29 CFR 2520.103-8, what is the impact on the auditor’s report?

5. Generally, what initial audit procedures would the auditor perform on the beginning of year (e.g. – January 1, 2009) contract and accounts?

6. What procedures does the auditor need to apply to the comparative statements of net assets available for benefits?

52


403(b) Retirement Plan Audits- Frequently Asked Questions (FAQs)

7. What if historical records do not exist or are not available for reported contracts and accounts?

8. If the plan receives a modified auditor’s report in the first year, will the auditor be able to issue an unqualified opinion in subsequent years?

9. If the plan administrator excludes some contracts or accounts from the plan’s financial statements that meet the requirements of FAB 2009-02, or if the plan has inadequate historical records for reported contracts and accounts, what impact will these circumstances have on the auditor’s communications with those charged with plan governance?

10. Are there financial statement disclosure requirements if the plan administrator excludes contracts or accounts from the plan’s financial statements that meet the requirements of FAB 2009-02?

11. Who is responsible for determining the value of plan investments?

12. What if fair value of investments is not or cannot be estimated?

53


54

Question & Answer Session


55

Question # 1

A sponsor cannot determine if their 403(b) plan is ERISA covered or how many plans they have? What should the auditor do?


56

Question # 2

A vendor has indicated that they can provide historical information on a participant level basis – but not the plan level. What can be done?


57

Question # 3

How far does the auditor need to go back in testing beginning participant balances in an initial 403(b) audit ?


58

Question # 4

If contracts excluded in year 1 and a disclaimer issued, wouldn’t a disclaimer opinion be required in all future years as they are always excluded in the carried forward beginning year balance?


59

Question # 5

The client has indicated that they find an adverse or disclaimer opinion unacceptable and ask what they can do to obtain a “clean” opinion. What can the auditor do?


60

Question # 6

Can the plan instruct the auditor to perform a limited scope audit (section 103-8 disclaimer) of the comparative 2008 plan year balances? Are there any special considerations (certification, etc.)?


61

Question # 7

When auditing beginning balances, what should the auditor do if the client has missing records (e.g., they only maintained payroll records going back 6 or 7 years)?


62

Question # 8

What is the auditor’s responsibility to test for delinquent contributions in prior years?


63

Question # 9

Most 403(b) plan sponsors don’t participate in any meaningful way in the benefit payment process. Could you please comment on where this would land on the SAS 115 communication?


64

Question & Answer Session


65

AICPA 403(b) Plan Audit Training• ERISA 403(b) Audit Issues

• 100 minute audio course based on the highly rated session from the AICPA National Conference on Employee Benefit Plans.

• 403(b) Plans -- DOL and IRS Compliance • 100 minute audio course is based on the highly rated session from the

AICPA National Conference on Employee Benefit Plans.

• Best of AICPA National Conference on Employee Benefit Plans: 403(b) Update – • 300 minute Conference On-Demand is a collection of conference

highlights

• Coming soon! Audits of 403(b) Plans: A Challenging New Audit Area• (Text Available June 15, 2010; DVD/Manual and On-Demand format

available July 5, 2010)

Available at AICPA Store at CPA2Biz.com


66

Coming Events Mark Your Calendars!

Future EBPAQC Live Forum webinar:• Insurance Contracts- July 21, 2010

Upcoming AICPA Conferences:• December 13-14, 2010, EBP Accounting, Auditing and

Regulatory Update, Omni Shoreham Hotel, Washington, DC

• May 2-4 2011, National Conference on Employee Benefit Plans, Aria, Las Vegas, NV


67

Wrap Up

Consider using the

EBPAQC

Member-to-Member Forum


68

Evaluation

We welcome your feedback on today’s call

Please complete the online evaluation

http://www.zoomerang.com/Survey/WEB22AR5B45YWC

Thank you!!!

http://www.zoomerang.com/Survey/WEB22AR5B45YWC

69

Thanks for Participating!

Employee Benefit Plan Audit Quality Center EBPAQC 403(b) Plan Audits Live Forum Webinar...

Documents

Transcript of Employee Benefit Plan Audit Quality Center EBPAQC 403(b) Plan Audits Live Forum Webinar...