401 (k) Plan Audits-What to Expect of the Process

• Overview
• CD & Manual Credit
• Podcast Credit
• OnDemand Credit

Overview
The idea of auditing a 401(k) plan can seem daunting and intimidating to some. In addition, as it is essentially a compliance requirement, few plan sponsors see much value in the audit. This OnDemand Webinar will explain in depth what is involved in the audit of a 401(k) plan. Gain insight into the various entities involved in the audit process and what they contribute to the successful and timely completion of an audit. Understand what an auditor is testing and why. With a coordinated effort of all involved parties, the audit can be completed in an efficient and timely manner. Failure to complete an audit can be costly to a plan sponsor due to a late filing of Form 5500. An inefficient audit can also result in additional audit fees and frustration among plan sponsor employees and other service providers. This OnDemand Webinar will shed light on why a 401(k) audit is important and how it can be performed efficiently by all involved parties.

Authors
Bertha Minnihan, Mohler, Nixon & Williams
Brad Wall, Mohler, Nixon & Williams

Self Study Credit - OnDemand Webinar

Self Study Credit - CD & Reference Manual

Self Study Credit - Podcast

Agenda

Why Is an Audit Needed for 401(k) Plans?

• Compliance Audit
• General Rules About Various Requirements
• Required Attachments to Form 5500
• Risks of Not Complying

Entities Involved in the Audit Process

• Plan Sponsors
• Plan Service Providers

- Investment Custodian and/or Trustee

- Third-Party Administrator

- Others

• Auditors
• Others

Audit Process

• Obtain Audit Packages From Plan Service Providers
• Review of Information Received by Auditor

- Make Selections for Detail Audit Testing

- Make Selections for Testing of TPA Provided Data

- Documentation and Testing of Plan Sponsor Internal Control Processes

• Auditor Perform Audit (Fieldwork) Upon Receipt of Requested Information
• Auditor Review of Form 550
• Preparation of Financial Statements

What a Plan Sponsor Can Expect During the Audit Process

• Auditor Gain Understanding of How Plan Is Administered and by Whom
• Auditor Review Internal Controls of Plan Sponsor That Are Involved in Plan (Typically Human Resources, Payroll and Finance Functions)
• Auditor Obtains All Relevant Plan Documents, Plan Amendments, Plan Contracts, Determination Letters, etc.
• Auditor Reviews Audit Support Provided by Plan Sponsor, Typically HR Records and Payroll Reports

Miscellaneous

• Benefits to Plan Sponsors
• Best Practices
• 5500 Filing