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Old ESOP Plan Documents / No Adoption Agreement

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New client is in initial stages of audit of Esop. 

In reviewing her businesses 2013 ESOP Plan Document I noticed there was no Adoption Agreement prepared for client at time. Or at least none the client could find. And no restated esop documents. There are corporate resolutions and an SPD. 

Its my understanding that the former TPA (who I'm told was a volume submitter) at the time assisted in drafting clients esop documents. I thought it would be easy to contact them but I don't believe they're still in business. 

It seems a little late in the proverbial game to draft an adoption agreement corresponding with the provisions of the plan document. 

As part of our IDR disclosure to auditor would you give copy of old ESOP Plan  Document with explanation that the TPA is no longer around to obtain a copy of any adoption agreement? 

Thoughts and comments appreciated. 


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ESOPs were not always part of and eligible for the pre-approved/volume submitter document program. I think it was just the prior cycle for which that was available. That means the plan was individually designed by definition - regardless of the document platform that was used (like cash balance plans years back).

Like cash balance plans, or any plan for that matter, the ESOP was not required to be put on a pre-approved document. You can always remain individually designed, in which case you need not and can not submit an updated document for a determination letter, except for an initial determination, plan termination or other special circumstances defined by the Secretary. However, individually designed plans are still required to be amended timely for changes in the law and periodically restated after a certain number of amendments - you need not restate every 6 years as with pre-approved documents.

Look at the existing document, it's determination letter and the prior 5-year cycle under which this came. It might be a cycle B or C plan for which a 2013 restatement would be appropriate - BUT, they should also then have any and all required interim amendments for ESOPs, adopted timely (which is, as you know, one of the primary advantages of using a pre-approved document).

So even if the intent was adopt a new pre-approved document as evidenced by a resolution, the lack thereof may not be a compliance issue. Updated SPDs are also a periodic requirement and may not necessarily mean a restatement was prepared.

Hope this was helpful and good luck.

Kenneth M. Prell, CEBS, ERPA

Vice President, BPAS Actuarial & Pension Services


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I doubt a 2013 document would be a true volume submitter for an ESOP.  It has only been with in the last 12 to 18 months I have seen those that are fully operational with all the needed approvals.  

Does it look like this is a full document?   They might have been working on draft volume submitter as the IRS has been talking for a long time of getting ESOPs to that point.  But in the end they just used that base to make it a custom document maybe????


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