stock valuations

[Guest lbleier]

I have a question regarding valuation of employee stock in a 401(k) plan. Regulators are telling a particular bank that their current process does not comply with ERISA.

Their current process is that they get an annual valution, which they then convert to multiples of book ( a term I do not understand) at time of valuation, then use that as a multiple of whatever book is at time of transaction. Does this sounds proper?

[RLL]

Certain transactions involving non-publicly-traded employer stock require a valuation determination by an independent appraiser as of each transaction date, pursuant to ERISA sections 408(e) and 3(18). The valuation process that you described does not appear to comply with this requirement.