Correction of Delayed Distribution

[Guest Bud]

A participant's distribution form was lost for a while. We found it and are processing the participant's claim. This is taking about 6 months more than our usual time, but still within the 60-day provision of the plan document (401(a)(14) rule). The participant feels she is entitled to lost earnings. Does she have a valid claim because it was beyond our normal processing time or not because it is within 60 days of the later of normal retirement, 10 years of service or termination of service?

If we want to pay her lost earnings anyway, can we make an additional contribution to the plan that will be treated as earnings only for this participant or will we be violating the plan's allocation provisions by applying it only to the participant?

Thanks.