Terminated Plan wants to Self Correct Omission of Eligible Participant

[401kQ's]

During a plan audit, the auditors discovered that deferrals were not withheld for an employee who had completed a deferral election form. The plan was terminated, all participants paid out and final 5500 completed before this was discovered. The plan terminated because they were bought out by another company who sponsors a 403(b) plan. Should they self-correct by depositing the QNEC plus earnings from the terminated 401(k) plan into the current 403(b) plan?