Proposed PPA regulations

[FAPInJax]

Don't you just love that the law and proposed regulations provide:

"incentives" for actuaries to determine the AFTAP (luckily they defined this as related to the current liability for the first year)

What an incentive for a client to lose 10 points off the percentage if not completed by 4/1!!

I can hear the phones ringing off the hook!

[tymesup]

Client A - I don't have to pay that SOB a lump sum if you don't certify that the plan is well-funded? Take your time.

Client B - I can pay my buddy a lump sum if you don't certify that the plan is in deep weeds? Take your time.

Client C - Nobody accrues benefits until I give you the data? Call me again in November.

Yeah, this is going to work well.

[Andy the Actuary]

So, question arises what is professional responsibility as EA to plan participants if client intentionally (how can you tell) delays providing information so that certification is untimely and lump sum payouts are restricted?

I still have a couple January 1 valuations that will not be completed until after September 15 deadline for contributing for 2006.

The April 1 certification date was most certainly lobbied for by someone who had no concept of how the world operates.

The real question, which depends upon staffing, work load, and the date of the EA meeting, how soon after December 31 must a client provide you information to ensure you make the April 1 certification? For some Plans, we don't get asset statements until 5-6 weeks after the close of the Plan Year.

Does anyone know in what manner and form EAs must make the certification? I wonder if the form will be provided by April 1?

The only work I'm counting on having completed by April 1 is my 69 page digest of the 133 page proposed reg.

[tymesup]

April 1st is a nice date for certification. It gives you half a month from when you finished up ADP testing on March 15th.* It gives you half a month from when the corporations needed their tax deductions on March 15th.* And it leaves you half a month for the sole proprietors who want their tax deductions on April 15th.

Plus, it's April Fool's Day.

*Less if you go to the Enrolled Actuaries meeting