Audit Cost

[Guest Boruch]

Hey everyone, I'm new here. I was wondering how much you, or your clients, pay for plan audits. Is it worth it to go with a big firm, or is a small firm that specializes in 401ks or DBs usually good enough? I'm inquiring about limited-scope (possibly full scope too) 401ks and DBs. Does the fee vary much based on the number of participants? If location makes a difference, I'm located in California. Also, could the auditor be from another state, thereby giving me a larger pool to work with?

[david rigby]

Intentionally avoiding a direct answer to your question, it seems proper for you to interview several auditors directly, and fees are a legitimate inquiry. You can learn a lot by interviewing, even from the firms you decide not to hire.

It is not necessary to use one of the jumbo firms; I've worked with many local and regional firms; competent auditors can be found in all. In my opinion, continuity is more likely with the local or regional firms. (By "continuity", I mean that the individual auditors may change each year, but is less likely with a local or regional firm.) Experience w/ qualifed plans is very important. Location is usually not a determining factor, but auditor with closer location might produce a lower fee structure.