Audit requirement

[R. Butler]

Company has two plans one for Union Employees, one for Nonunion Employees. The Union plan has over 100 participants, the nonunion plan does not. Does the audit have to encompass both plans or just the union plan?

Thanks in advance for any guidance.

[Guest galdridge]

Audit requirements are plan specific. In your situation, assuming that the union plan has greater than 100 eligible participants at the beginning of the plan year and does not meet any of the eligible exceptions (i.e., 80-120 participation or short plan year rules), the union plan would be considered a large plan (an audit would be required) and the nonunion plan would be considered a small plan (no audit would be required).

Glenn Aldridge, CPA

Audit Manager

Bennett Thrasher PC

Atlanta, GA

[JohnCheek]

Also, consider the nature of the plans. If the two union plans are single employer plans (and this includes plans for a controlled group), then you, I assume, are probably the plans' sponsor and administrator, and you would be required to file the 5500 and comply with the audit requirement.

On the other hand, if the union plans are multiemployer plans, then the sponsor/administrator would be the board of trustees, and they would be filing the 5500 and addressing the audit.