Allocating the earnings calculated on the VFCP calculator

[katieinny]

I'm not having much luck getting answers to my 403(b) questions, but here's another one just in case somebody takes pity on me.

The plan document says that the ER can contribute any amount necessary to correct a violation under EPCRS or the VFCP. But I don't see a reference in either the document or the VFCP material that says how the earnings should be allocated. I'm talking about earnings over several months, so the only method that makes sense to me is to allocate the amount pro-rata based on the participant account balances. But I would be interested in hearing the thoughts of others who are far more familiar with these matters than I am.

[rcline46]

We allocate to each payroll the lost earnings for that payroll prorata to the contributions in the payroll.

[katieinny]

Thanks recline46. That makes perfect sense. It will take what seems like forever to get it done, but the results will be far more accurate than my too simplistic proposal.