PE Client Communication – Post NTSAA Conference 2012
We just returned from an industry conference where a few newsworthy items were discussed during the sessions.
We learned that the Internal Revenue Service has launched 403(b) and 457(b) retirement plan audits in different areas of the country. The initial wave of activity is focused on the west coast along with Colorado and Massachusetts. We also learned that a new group of Plan Auditors has just completed training and will be deployed to different areas of the country (the IRS was mum as to where they are going).
Attached is a checklist you can use to review the current audit readiness state of your plan – and if you have questions or concerns after that review – please call an ADMIN Partners team member.
You will recall that plans subject to ERISA must begin reporting fee and investment information beginning July 1, 2012. And while your retirement plans are not subject to these obligations, the industry supporting public education retirement plans decided to implement a voluntary fee disclosure program. These best practices are codified in the 403(b) Model Disclosure Form which includes information on:
- Services,
- Administrative and Operational Fees,
- Annuity Product Charges,
- Mutual Fund Account Charges,
- Investment Information, and
- Payments to Third Parties.
We strongly support this movement toward greater transparency. It is good for everyone. Plan Sponsors and plan participants can easily compare the services they receive for the fees incurred along with information on investment performance and payments made to third parties. You can view a copy of the model disclosure form at: http://savemy403b.org/wp-content/uploads/2012/02/403b-Model-Disclosure-Form.pdf
ADMIN’s initial thought is to make this information available to eligible employees and plan participants through our website on each district’s web portal. ADMIN would provide this information as part of our base services – so there would be no additional costs to you for this support.
The question is whether you believe investment providers should, as a condition for remaining an approved vendor in your plan, provide the model disclosure material? We would like to know what you think.
If you believe that investment providers should be required to provide the 403(b) model fee disclosure material to participants as a condition of remaining an approved vendor in your plan, click here service@youradminpartners.com and type “Yes” in the Subject line.
Tags: 403(b) plan, 457(b) plan, ERISA, fee disclosure, NTSAA