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September 24, 2002 - 11,860 subscribers
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ASPA Airs Views on Electronic Filing of Form 5500 by Retirement Plan Administration Firms
Testimony of Janice M. Wegesin, President of JMW Consulting, Inc., to the ERISA Advisory Council on September 20, 2002. Excerpt: "[W]e informally surveyed our members about electronic filing of Form 5500. When asked, 'Do you currently use electronic reporting?' the response was an overwhelming 'NO!' although a few brave souls, myself included, are either 'primarily' using electronic filing or are 'selectively' filing Form 5500 electronically.'" (American Society of Pension Actuaries)

ERISA Attorney to IRS: Amendment to Comp Definition Shouldn't Be Part of GUST Deadline (PDF)
8 pages, but a possibly long download (about 1 Mb in size). Excerpt: "The issue relates to the Service's decision to treat the amendments made by ... the Community Renewal Tax Relief Act of 2000 [to the definition of compensation for purposes of Code section 415] as 'disqualifying provisions,' terminating the (and, as discussed below, we believe inappropriately shortening the otherwise applicable) remedial amendment period with respect to such changes ..." (Mark S. Dray, Esq. of Hunton & Williams)

Pension Rights Center Presents Its Perspective on Possible DOL-Sponsored Fiduciary Education Program (PDF)
8 pages. Excerpt: "The Center is the nation's only consumer organization dedicated solely to protecting and promoting the pension rights of American workers, retirees and their families.... Our unique role allows us to hear from plan participants from around the country with questions and problems ... including fiduciary error.... I would like to share a few examples with you, and afterwards address the remedial and/or prophylactic potential of fiduciary education." (John Hotz, Deputy Director of the Pension Rights Center)

Two More Felony Counts Charged in Milwaukee Public Pension Scandal
Excerpt: "Two more felony counts have been filed against the lead architect of a pension plan that would have given some Milwaukee County officials lucrative payouts. Prosecutors accused former county personnel director Gary J. Dobbert in May of three counts of misconduct in public office over actions that they said were designed to boost his own pension." (AP via

U.S. Prepares for Revolution In Pension Accounting Standards by 2005
Excerpt: "David Tweedie, the chairman of the International Accounting Standards Board, ... is at the centre of a revolution in accounting standards. The Scot, who two years ago devised the FRS17 standard on pensions disclosure, looks set to see it rolled out around the world. Last week, he met Bob Herz, his opposite number at the Financial Accounting Standards Board, the U.S. standard-setting body." (Financial Times via Yahoo! Finance)

Online Tools Can Help Users Outline Their Retirement Investing Strategy
Excerpt: "[Y]ou will find some very helpful tools that allow you to outline your financial future, whether you plan on retiring 10, 20 or 30 years from now.... Employers, in particular, seem eager to offer them as an inexpensive way to offer help to workers who must handle their own retirement savings." (Miami Herald via

Multiemployer Fund Plans Wants Review of Loss in 7th Circuit on Suspension-of-Benefits Case
Excerpt: "The fact that the pension fund won't accept the defeat handed to it in Chicago has [plaintiff Rick] Schmitt disturbed. He doesn't think it's fair that all the workers, some of whom are his friends who continue paying into the fund, have to support litigation aimed at keeping him from receiving his benefits." (Peoria [Ill.] Journal Star)

Opinion: Public Pension Shortfalls and Consultant Conflicts-- What's the Connection?
September, 2002 edition. Excerpt: "We have often warned pensions that their consultants make substantially more money from investment managers interested in buying access to pension clients of the consultant than from advising pensions. Unfortunately this is a message some pensions simply don't want to hear." (The Benchmark Companies)

Massachusetts Town Finds Early Retirement Incentive Program Doesn't Fit
Excerpt: "The Norwood subcommittee felt the program would not work since a survey of department heads revealed that no one is willing to permanently cut jobs. Without staff cuts, the ERIP would cost the town money. 'This is a staff-reduction act,' said town accountant and subcommittee member Bob Thornton. 'The towns and entities that have adopted this have done so only with the provision that 80 percent of the people going out aren't coming back in.'" (The Neponset Valley [Mass.] Daily News)

Analysis: Social Security Reform: Voluntary or Mandatory Individual Accounts? (PDF)
7 pages. Excerpt: "[A]llowing participants to [decide whether to use individual accounts] raises a number of concerns, including: Does offering a choice increase overall program costs? Would participants be sufficiently knowledgeable ... to make informed decisions? What benefits should participants get if they choose to remain in the traditional plan, particularly if it is not financially sound? ... The purpose of this issue brief is to explore the issues that policy-makers should consider ..." (American Academy of Actuaries)

Using Automatic Adjustments to Maintain Social Security's Long-Range Actuarial Balance (PDF)
8 pages. Excerpt: "Under an automatic-adjustment approach, changes would be made to the payroll tax rate, specified Social Security benefits, the normal retirement age or some combination of these three on an annual or periodic basis to keep the system in long-range actuarial balance. Such an automatic-adjustment approach is used to maintain long-term solvency in the Canada Pension Plan, which provides benefits similar to Social Security. This issue brief discusses automatic-adjustment options ..." (American Academy of Actuaries)

AARP Survey Indicates Americans Not Planning on Early Retirement
Excerpt: "An increased number of older employees would certainly lessen a steep drop-off in the labor force, expected as baby boomers age. Conversely, it could also increase health insurance costs for employers." (San Diego Daily Transcript via Yahoo! News)

Links to Items on Executive Comp, Benefits in General

Available for Purchase: Tapes of May 2002 ABA Tax Section Meeting
Tapes include Employee Benefits - Friday Program ($20), Employee Benefits - Saturday Program ($20), Employee Benefits Tax Opinions and Advice - Ethical Issues ($20), Split-Dollar Financing Under a New Regime: A Discussion of Notice 2002-8 ($20). Click on 'Add to Cart' to purchase an item, then 'View Cart' to review and purchase. (These are not sold by BenefitsLink; you'll be buying directly from the ABA's Audio Tape Store.) (American Bar Association, Section of Taxation)

Welch's Decision to Pay for His Perks: the Inside Story
Excerpt: "So Welch sought the best advice he could find and went against most of it. If that sounds familiar, it should: It's a pattern that has served him well throughout his career." (

Stock Options: What if Andy Grove is Right?
Excerpt: "What if stock option accounting is, as Andy Grove, Intel chairman, said last week, 'a red herring'? What if the whole debate about the treatment of option costs is a messy, futile and time-consuming distraction from the real issues of corporate greed?" (Financial Times)

SEC Chairman Says Shareholder Proposals Should Not Be Prevented by Executives
Excerpt: "Top U.S. markets watchdog Harvey Pitt said on Monday he wants to abolish a rule that allows companies to ignore shareholder proposals, paving the way for investors to keep more tabs on corporate executives. Pitt ... said shareholder efforts, such as attempts to block stock option plans awarded to corporate executives, should not be stifled." (

Opinion: a Case Against Expensing Options
Excerpt: "I believe that appropriate disclosure is a better alternative. Expensing of options in the year they are granted goes against accounting fundamentals. Moreover, it expands management's war chest for manipulating reported results. In other words, it helps rather than deters executives from practising creative accounting." (The Business Times)

In Canada, Tech Companies Using Fewer Stock Options
Excerpt: "Ravaged by the stock market, Canadian technology companies are turning to cash incentives to retain employees instead of stock options, according to new research by AON Consulting Inc." (National Post)

HR Association Advocates Creation of Voluntary Certification for Fiduciaries
Excerpt: "The Society for Human Resource Management (SHRM) Sept. 19 recommended the creation of an education program and a voluntary certification for HR professionals who act as fiduciaries for their companies in testimony presented at the U.S. Department of Labor (DOL).... SHRM recommends working with government agencies to create a 'one-stop program' to cover all of an HR professional's employee benefit plan compliance responsibilities." (Society for Human Resource Management)

Newly Posted or Renewed Job Openings - Post a Help Wanted Ad

Benefits Manager (Service Delivery Manager)
for Towers Perrin
in VA

Education Specialist
for Cigna
in CA, CT

Sr. 401(k) Communications Analyst
for Tenet HealthSystem
in TX

Senior Accounting Specialist - Benefits Accounting
for OneBeacon Insurance Group
in MA

Communication Director
for Cigna
in CA, CT, IL, TX

Associate (JO #318)
for A Third Party Administration Firm in IL and NJ
in IL, NJ

Consultant and Senior Consultant (JO #319)
for A Third Party Administration Firm in IL and NJ
in IL, NJ

Manager, Compliance
for Means & Associates, LLC
in CA

Newly Posted Conferences (Post Yours!)

New DOL Rules for SPDs and E-Communications ... Are You Ready?
October 10, 2002
Thompson Publishing Group

in GA
October 17, 2002
WEB Atlanta Chapter

Newly Posted Press Releases

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