For many companies, early summer represents the beginning of the Employee Benefit Plan Audit Season. As a plan administrator, you’re tasked with coordinating data and working with your company’s auditor to ensure your company’s employee benefit plan audit is completed timely and to uphold your fiduciary responsibility to the plan and its participants. While you may not be looking forward to it, your next Employee Benefit Plan audit can be less stressful and time-consuming and more efficient by focusing on the following tips.
- Perform a check-up of your retirement plan. You are responsible for keeping the company’s plan in compliance with applicable laws and regulations. Review your plan annually to ensure it’s operating according to its terms and the law. Plan activity should also be reconciled on a routine basis. Correct any mistakes now.
- Be proactive and persistent about data collection. What’s that they say about the early bird and the squeaky wheel? Reaching out to your service providers who hold your investments and maintain the plan’s records, early and often, will ensure you’ve obtained the necessary documents for the audit team to prevent delays.
- Establish a point of contact. Avoid miscommunication and ensure efficiencies by clearly designating a single team member – preferably whoever is primarily responsible for administering the plan – to be the point of contact between the company and your auditor.
- Provide access to documents outlined in the auditor’s request list. Be sure to understand what information will be needed for the audit, the desired format and the timeline to provide requested documents (such as prior to the start of fieldwork or when the auditor is onsite).
- Communicate changes to the plan and its operation. Make your auditor aware of any changes made to the plan document, how the plan operates, or any compliance matters identified during the year. Communication of these items early in the audit process allows the audit team to assess the risks and the impact on the audit procedures performed.
While rules and regulations affecting Employee Benefit Plan Audits may change, the time-tested tenets of thorough preparation, organization and communication will make the process easier and more efficient on everyone. To learn more about how RKL helps companies meet their compliance and fiduciary responsibilities, visit our Employee Benefit Plan Audits page or contact your RKL advisor.
Contributed by Leanne K. Gorsuch, CPA, a principal in RKL’s Audit Services Group. Leanne has 20 years experience in public accounting, serving the accounting and auditing needs of clients in a variety of industries and specializing in Employee Benefit Plan Audits.