Schedule C

[Alex Daisy]

I am preparing a Schedule C and had a question on eligible indirect compensation.

I need to report 12B-1 fees from an investment manager,

What if I am not sure the Plan Sponsor was provided with the written disclosers to be considered “eligible” indirect?

Is a fund prospectus enough to satisfy the written disclosure rules?

[Laura Harrington]

I am preparing a Schedule C and had a question on eligible indirect compensation.

I need to report 12B-1 fees from an investment manager,

What if I am not sure the Plan Sponsor was provided with the written disclosers to be considered “eligible” indirect?

Is a fund prospectus enough to satisfy the written disclosure rules?

I am going to say no, that providing the prospectus itself does not qualify, based on the DOL's response to Q29 of the Schedule C FAQs. Someone still has to tell the plan sponsor that the prospectus was intended to satisfy the disclosure requirements.

Q29: Can a recordkeeper satisfy the alternative reporting option for eligible indirect compensation by furnishing the plan administrator with prospectuses, brokerage fee schedules, the SEC Form ADV, or other already available documents prepared and provided to the administrator for separate purposes, or must it create its own written disclosure document?

As long as the person who is identified on the Schedule C as providing the required disclosures for the eligible reporting option advises the plan administrator that disclosures in those documents are intended to satisfy the alternative reporting option in addition to serving the other purposes for which the documents were generated, provision of existing documents will satisfy the alternative reporting option if a reasonable plan administrator can readily determine from the documents: (a) the existence of the indirect compensation; (b) the services provided for the indirect compensation or the purpose for the payment of the indirect compensation; © the amount (or estimate) of the compensation or a description of the formula used to calculate or determine the compensation; and (d) the identity of the party or parties paying and receiving the compensation. Furnishing the plan administrator with a separate document that identifies the other already provided documents that contain the required information also would satisfy the eligible indirect compensation disclosure requirement provided the separate document includes references to pages or sections of the document that contain the required information.