Does Special 80/120 Rule Exempt from Audit too, or just full f5500?

[Oh so SIMPLE]

I have a calendar year plan that had under 100 participants at the beginning of 1/1/2010. For 2010, a Form 5500-SF was filed.

As of 1/1/2011, there were 117 participants. 29 CFR section 2520.103-1(d) allows the 2011 annual report to be filed as a Form 5500-SF under the special 80/120 rule.

If it does, is it exempt from the independent accountant's audit requirement of 29 CFR section 2520.104-46 and -41, which specify the 100 threshold, but not the special 80/120 rule?

Does anyone know of any IRS ruling that applies the special 80/120 rule to the independent accountant's audit report requirement too?

[ACox]

Assuming that at least 95% of the plan investments are "qualified plan assets" (i.e. held by bank, insurance company, IRA Trustee, mutual funds, etc) and any bonding requirements are met, then the Form 5500-SF can be used. By using the Form 5500-SF you have an audit waiver as no audit is required for the 5500-SF.

[Kevin C]

Being a small plan filer under the 80-120 rule also makes you a small plan for determining if you qualify for a waiver of the audit report requirement under §2520.104-46. The paragraph in that reg that mentions it is (d)(2).

The small plan audit waiver is not limited to just 5500-SF filers. Small plans that file a Form 5500 can also qualify for the audit waiver under §2520.104-46. Line 4k of Schedule I is where you indicate on the 5500 that you qualify for the small plan audit waiver.