401k with cash balance

[thepensionmaven]

Client PC currently maintains a cross tested 401K profit sharing plan; adopting cash balance for 2016.

Accountant mentioned he should terminate existing 401k and roll over to IRAs for all and adopt new 401k in combination with cash balance DB. because sharing contributions rise dramatically each year as client only participant getting more than a money market ROR. Says the participants have chosen money market investments.

Does this make any sense?

[John Feldt ERPA CPC QPA]

No, the accountant must have some other agenda, or mistakenly thinks the rate of return on the 401(k) accounts has some impact on the DB plan.

[K2retire]

Given that an employer must wait at least 12 months after terminating a 401(k) plan before they are eligible to sponsor a new one, it really doesn't make sense. Perhaps the accountant was confusing the terminology and meant to amend the 401(k) or move it to a different investment platform.

[TPAJake]

That accountant is talking out of the wrong end if you know what I mean