Michelle

First things first....read the plan document. Some prototype and preapproved documents have language pertaining to ERISA accounts. If the document is silent regarding these types of accounts, look through the definitions for the definition of earnings. The rev share could fall into that definition and then they would be required to be allocated as earnings. If the document is completely silent, then the allocation becomes fiduciary discretion. Most would use prorata allocation. If these assets are not allocated in accordance with the plan document, then you would be cited for at least 404(a)(1)(D), failure to follow plan documents. The way that DOL looks at these types of accounts, which they definitely do, is that they should be allocated in accordance with the plan document, or alternatively, at fiduciary discretion by the end of each plan year. Plans cannot have "slush funds" or accounts that accumulate for the use of plan expenses year after year. They view this as a benefit to the employer, since the employer may have to pay the expenses that are not funded. (Be sure to check the plan document for restrictions on the payment of expenses as well)