Raleigh, NC (July 14, 2011) - The US Department of Labor was active in 2010, issuing many regulatory updates to the Retirement Income Security Act of 1974, or ERISA. This flurry of activity will require plan sponsors and providers to stay abreast on the latest updates and to take action during 2011. To assist Triangle business leaders, Hughes Pittman & Gupton, LLP (www.hpg.com), one of the largest CPA firms headquartered and staffed in the Research Triangle Park region of North Carolina, recently held an ERISA seminar to provide insight into the latest regulatory, financial reporting and administrative issues affecting employee benefit plans today.
HPG has a dedicated ERISA practice led by partners J. Mark Livingston, CPA and Nancy Campbell, CPA. Livingston presented the ERISA discussion and highlights some key updates below:
Reporting Changes for 2010 Plan Audits
“ERISA filings can be weighty at times, but it is imperative to file on time to avoid being penalized,” says Livingston. “It is also critical to openly communicate with the Department of Labor if they engage you regarding compliance issues.”
US Department of Labor Regulatory Updates
During the ERISA update, Livingston also reviewed preliminary findings from the 401(k) Compliance Check Questionnaire Project, by the IRS Employee Plans Compliance Unit. The IRS wanted to learn more about 401(k) operational compliance and distributed the questionnaire. Twelve hundred employers who sponsored 401(k) plans in 2007 were selected at random to complete the questionnaire.
The top 10 errors found were failing to:
The IRS will continue evaluating the responses to better understand 401(k) compliance issues. A full report is to be posted on the IRS website in late 2011.
Livingston pointed out that compliance checks are not considered an audit or investigation under IRS Code Section 7605(b). An audit involves the inspection of books and records by an agent, and no voluntary correction is available. If an audit resulted in similar findings, penalties could range from $50 to $300 per day for each failure.
He also recommended companies use a free checklist offered by the IRS as a starting point in assessing plan compliance. The checklist is available at www.irs.gov/pub/irs-tege/pub4531.pdf. Livingston stressed that the checklist is only a guide to a more compliant plan and recommended that company leaders contact a qualified CPA and attorney specializing in ERISA compliance for further assistance.
About Hughes Pittman & Gupton, LLP (HPG):
HPG is one of the largest CPA firms headquartered and staffed in the Research Triangle Park region of North Carolina, as ranked by the Triangle Business Journal. More than just an accounting firm, HPG assists clients in looking beyond the bottom line by being the right people, right value and right firm to achieve each client’s definition of success. HPG is a member of CPAmerica International and affiliated with the Crowe Horwath International alliances of firms, with offices worldwide. The firm leverages this to provide national and global accounting resources to its clients. HPG offers a wide array of business accounting, auditing, corporate tax and management advisory services. Specialities include serving owner-managed, investor-backed technology and life science organizations, healthcare services, real estate development, manufacturing and distribution businesses, as well as providing ERISA audits, family wealthcare services and Sarbanes-Oxley internal audit services.
HPG has remained committed to advancing a thriving Triangle community since its founding in 1983. In recognition, the firm is the recipient of two Pinnacle Business Awards by the Greater Raleigh Chamber of Commerce; the 2009 Large Entrepreneurial Business Award and the 2010 Integrity in Business Award. Additionally, HPG has been certified Green Plus by the Institute for Sustainable Development for integrating environmental sustainability efforts into company culture, and has been named one of the top 100 Best Accounting Firms to Work for in the country by Accounting Today. Visit www.hpg.com or follow HPG on Twitter at http://twitter.com/HPGcpas.