Schedule B

[Guest Jaynie]

My question is whether or not the Enrolled Actuary for the plan is required to prepare a Schedule B if he is not going to be paid for the preparation of the "B" just because he prepared the actuarial valuation report

[Andy the Actuary]

Not sure whether or not you are legally required to do so, and will not research this. HOWEVER

The client has paid you for completing the actuarial valuation. If you refuse to prepare the Schedule B -- even though you may have requested payment and they refuse -- the client would be required to obtain and pay for a replacement actuarial valuation for another actuary to certify the schedule B. Depending upon the circumstances, there may not be time to do so, and so the client would be put in a late-filing position and be subjected to penalties and interest. Your next correspondence may be from the former client's attorney.

I would suggest a 4 step approach:

(1) Look to your engagement agreement;

(2) Check with your E&O carrier;

(3) Check with your legal counsel; and

(4) Ignore (1), (2), and (3) whatever the findings and prepare the Schedule B. With software, it takes hardly any time.

In short, ignore whatever ill feelings you may have and prepare the $%#!*)^ Schedule B; else, you're looking for trouble.

[Effen]

In general I agree with Andy, assuming you have been paid to prepare the actuarial valuation. If they never paid you for the valuation, I don't feel you are obligated to sign the Sch. B. If they paid for the valuation, the Sch. B is simply certifying to the government the work you already did. You need to check your procedures and see if paying annual fee includes the valuation & Schedule B.

Many large national firms will charge the client extra to prepare the Sch. B if they are fired after they do the val. I have had some situations where the clients pays the "extra" freight, and others where they pay me to redo the val and sign the B.

I suggest that you contact the ABCD. My experience with them has been very positive getting through this type of situation.

What about the PBGC filing?

[Andy the Actuary]

The PBGC premium payment process can be completed without an actuarial certification in most circumstances if the alternate variable premium calculation method is used. In such case, I wouldn't feel obligated to provde this service unless it was according to the engagement agreement included in the fees the client has already paid.

[david rigby]

This situation, or similar, has been discussed at several actuarial meetings. It usually boils down to what Andy stated, especially the admonition to review your engagement.