5500 Assistance - Failed to Submit Contributions

[Gadgetfreak]

I have a Plan who is undergoing a (non-random) audit. Plan withheld deferrals in 2009 from salary but never submitted them to the custodian/record keeper nor did they submit any required SHM contributions. Yes, I have it documented up the "wazoo" telling them that they needed to, etc. The company was in major financial trouble (NOT that that is an excuse).

The DOL got involved and is making an arrangement for them to fund the Plan in 2010 with the missing deferrals (and, I assume, lost earnings, penalties, etc.) and possibly other SHM contributions. I have no idea when the DOL will make them pay this though I assume it will be in 2010.

The 2009 census they submitted indicates deferrals but the recordkeeper and custodian have none. Should the 2009 5500 be completed showing 2009 deferrals or not? On the one hand the "Plan" never received it. On the other hand, as soon as it was segregated, it became a Plan asset. Also, should a 5330 be submitted as I don't even know when the contributions will be made?

Thanks, in advance, for any assistance.

[Bird]

I'd show them as accruals. I don't know about the 5330; it seems that if the DOL is involved and you're paying interest and penalties you might not have to.

[12AX7]

Would you still show the accrual if the plan assets are reported on a cash basis? I would check with the DOL if the 5330 is still required (I'm not sure why not). I don't see how penalties are paid to the plan per the OP.

[Bird]

Would you still show the accrual if the plan assets are reported on a cash basis?

I guess not.