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Find it and fix it – retirement plan self-audits

Many retirement plan experts recommend annual general compliance reviews. However, according to a 2010 survey conducted by financial firm Grant Thorton International LTD, fewer than half of plan sponsors reported they had reviewed their entire plan’s operations in the past three years. Sponsors were also asked what compliance problems they had corrected within the past three years. Here are their responses:

  • 10% corrected eligible compensation problems.
  • 5% corrected eligibility participation issues, such as improper inclusion or exclusion of participants.
  • 5% corrected service-crediting problems (eligibility, vesting or determination of benefits).
  • 4% corrected participant loan issues.
  • 3% corrected distribution issues including timing, form and/or amount of distributions.
  • 22% said they corrected other issues not listed above.

GuideStone has a free Self-Audit Manual available on its website to assist employers in conducting a self-audit. Contact your relationship manager or simply download the Self-Audit Manual for more information.

Please note: While it is very important for churches to administer their plans correctly, GuideStone’s Self-Audit Manual is not designed for use by “churches” in the traditional sense of that word. The reason being, churches (congregations) that offer 403(b) plans to their ministers and/or paid staff are not subject to some of the more complex rules that apply to church-related organizations such as hospitals, children’s homes, universities and retirement centers. If you have questions about how to correctly administer your plan, please contact GuideStone at 1-888-98-GUIDE (1-888-984-8433) between 7 a.m. and 6 p.m. CST Monday-Friday or email us at your convenience.

This information should not be considered tax or legal advice. GuideStone stands ready to assist your organization as you work with your legal and tax advisers by providing resource information that you and your adviser may find beneficial.