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Retirement Plans
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November 12, 2002 - 12,746 subscribers
Today's sponsor: APSCREEN, Employee Locator

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(Help BenefitsLink to provide this newsletter at no charge to you -- our sponsors pay your way. Remember to visit them periodically; we try to make sure their products and services will be of interest to you. Thanks! --Editor)
Relationship between Revenue Ruling 2001-62 and Cash Balance Pension Plans
Excerpt: "Question: What is the effect of section 411(d)(6) of the Code, section 4980F of the Code, and section 204(h) of ERISA where there is an adoption of the table described in Revenue Ruling 2001-62 under a cash balance pension plan?" (Internal Revenue Service)

Open Season on 401(k)s
Excerpt: "Lawyers are lining up to sue employers with thrift plans. You can thank Enron--and the Department of Labor. Ever since Enron's rank and file watched $1.4 billion of Enron stock held in its 401(k) plans go up in smoke, liability claims under the Employee Retirement Income Security Act (ERISA) have caught fire. Lawyers have filed 115 suits against 35 companies claiming employees' 401(k) plans got shafted. Now it looks like the corporate suite has even more to worry about." (Forbes via Yahoo! News)

Full Text of Proposed SEC Rule on Insider Trades During Pension Fund Blackout Periods
Excerpt: "Section 306(a) prohibits the directors and executive officers of an issuer from ... acquiring or transferring any equity security of the issuer during a pension plan blackout period that prevents plan participants or beneficiaries from engaging in equity securities transactions, if the equity security was acquired in connection with the director or executive officer's service or employment as a director or executive officer." (U.S. Securities and Exchange Commission)

Workers May Be Losing Faith In 401(k)s
Excerpt: "Some fearful workers are cutting back on the amount they're stashing in their 401(k)s. Some are dumping stocks in favor of more conservative investments. Some are deciding not to invest in 401(k)s at all. And nearly three out of five workers surveyed recently said they'll overhaul their investment strategies if 2002 hands them a third straight year of losses." ([San Jose] Mercury News)

The Most Important Thing About 401(k)s Is Having One in the First Place
Excerpt: "The new study, written by Jack VanDerhei of Temple University and the Employee Benefit Research Institute and Sarah Holden of the Investment Company Institute, found that 'the most significant factor' in determining how well a 401(k) plan participant does is having access to a plan throughout his or her working life." (Washington Post)

Florida Judge Balks At Privacy Request In Pension Fund Manager Case
Excerpt: "A judge on Friday threatened to punish a New York-based investment firm accused of losing more than $300 million in state pension money during the Enron stock swoon. Leon County Circuit Judge Nikki Clark ripped the investment firm, Alliance Capital, for demanding that more than 20,000 pages of documents it turned over to the state's attorneys be sealed from public inspection." (The Tampa Tribune)

United Airlines, ESOPs, and Employee Ownership
NCEO executive director Corey Rosen explains why United's ESOP did not cause the company to fail but did fail to help United succeed. (National Center for Employee Ownership)

Employee Ownership Update for November 7
NCEO executive director Corey Rosen discusses the IASB's exposure draft on stock options accounting (now available for public comment) and a U.S. Department of Labor Field Assistance Bulletin on the obligations of a fiduciary under sections 404(a) and 408(b)(3) of ERISA in connection with the refinancing of an exempt ESOP loan. (National Center for Employee Ownership)

FAQs Regarding Multiple Employer Plans
Excerpt: "Per the changes made to the determination letter program for Multiple Employer Plans by Announcement 2001-77, does each adopting employer have to come in for an individual determination letter? ... Are the adopting employers required to give Notice to Interested Parties if they are not coming in for individual letters? ... Do the employers maintaining the plan have reliance on the determination letter issues to the plan?" (Internal Revenue Service)

FAQs Regarding Merged Plans
Excerpt: "When two or more plans are merged, how many Form 5300 Applications are necessary? ... If there are two plans that are being merged together is it necessary to have both plans separately amended for new tax law prior to the plan merger? ... What plan documents of the merging plans, if any, should be included in the GUST application for the surviving plan?" (Internal Revenue Service)

FAQs Regarding the Determination Letter Process
Excerpt: "What form should I file to notify the Internal Revenue Service of a plan merger, consolidation, spin-off, transfer of assets or liabilities, or of a qualified separate line of business? ... Is it important to retain copies of the application(s), demonstration(s), and related information that were submitted to the IRS? ... How do I obtain a copy of my prior determination letter?" (Internal Revenue Service)

FAQs Regarding Plan Language Issues
Excerpt: "How long do I have to amend my plan for the changes in the qualification requirements enacted by GUST? ... What are the major post-98 changes made by GUST? ... Are most GUST plan restatements written to be effective in 1994, 1997, or in the 'current' (i.e. year of adoption) plan year? Does it matter as long as the specific provisions relate back to the appropriate effective dates?" (Internal Revenue Service)

IRS Publishes Topical Index to Extensive Rev. Proc. on Retirement Plan Correction Procedures (PDF)
Excerpt: "The Tax Exempt and Government Entities ('TE/GE') Division of the Internal Revenue Service ... hopes that this topical index will assist plan sponsors and/or their representatives in researching the Employee Plans Compliance Resolution System ('EPCRS') [as set forth in Revenue Procedure 2002-47] and in determining the options that are available to resolve certain failures occurring in retirement plans." (Internal Revenue Service)

PBGC Announces Maximum Guarantee for the Year 2003
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) [has] announced that the maximum benefit it will guarantee for retirees in underfunded single-employer defined benefit plans that terminate in the year 2003 will be $3,664.77 per month, or $43,977.24 per year." (Pension Benefit Guaranty Corporation)

Traditional Retirement Plan Is Genuine Safety Net
Excerpt: "Have you hugged your boss lately? If you've got a traditional pension plan, maybe you should. For too many years, other types of retirement plans -- mainly the 401(k) -- have hogged the spotlight. All the while, the traditional pension plan -- technically known as the defined-benefit plan -- has been rudely shoved aside." (The Providence Journal)

Senator Judd Gregg Eyes Pension Changes under Republican Senate
Excerpt: "Sen. Judd Gregg said on Friday that under the Republican-controlled U.S. Senate he may try to promote defined benefit pension plans which have lost ground with corporations in recent years." (Reuters)

The Roots of the '90s Boom and Bust: Part One
Excerpt: "Speed and ascent, ambition and acquisition: They were the paramount ethics during the 1990s in technology and telecommunications, where a titan's climb seemed limitless and his fall improbable, where no one had forecast the spiral coming." (Washington Post)

The Roots of the '90s Boom and Bust: Part Two
Excerpt: "Nasdaq's top officers cite the usual culprits in explaining the market bubble: low interest rates, cheap and plentiful investment capital, optimism about the post-Cold War world. Also, they say, investors came to believe that an increasingly popular technology, the Internet, was about to change the world.... But such overviews sidestep another contributing factor: the Nasdaq itself." (Washington Post)

The Roots of the '90s Boom and Bust: Part Three
Excerpt: "Back in the heady days of a stampeding bull market CNBC was a driving force, a cultural phenomenon, a ratings success, the play-by-play announcer for America's new pastime." (Washington Post)

Links to Items on Executive Comp, Benefits in General

Employee Benefit Plan-Related Deadlines Are Looming
Excerpt: "As the end of the year approaches, so too do a number of deadlines and effective dates that may be important to your pension and welfare benefit plans.... [These are:] Updated SPD Content Requirements ... Updated Claims Procedure Rules [for welfare benefit plans] ... EGTRRA Good Faith Amendments [for retirement plans] ... Safe Harbor 401(k) Notice Requirement ... GAR Mortality Table [for defined benefit retirement plans] ..." (Deloitte & Touche Human Capital Advisory Services)

Bush's Way Is Clear to Press His Agenda for the Economy
Excerpt: "With his party in control and his political standing solidified, President Bush has new freedom to confront the weakened economy on his terms and has put his advisers to work developing an ambitious agenda for the next two years. It is sure to include making permanent the 10-year tax cut passed last year, securing new tax cuts for investors, holding down spending in areas other than national security and moving slowly toward overhauling the tax code and Social Security." (New York Times; free registration required)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Financial Transactions Specialist
for ExpertPlan, inc.
in NJ

Retirement Plan Sales Consultant
for Invesmart
in WA

Manager, Compliance
for Means & Associates, LLC
in CA

Benefits Attorney
for Intel Corporation
in CA

Senior Pension Administrator
for The Kagan Company
in CA

Counsel, Employee Benefits
for National Rural Electric Cooperative Association
in VA

Retirement Services Conversion Specialist
for SunTrust Bank - Atlanta, GA
in GA

Plan Specialist
for Transamerica-The Winning Organization
in CA

Plan Administrator
for Retirement Funding Corporation
in MI

Pension Administrator-Columbia, MD
for CBIZ Business Solutions, Inc.
in MD

Enrolled Actuary
for San Diego Pension Consultants, Inc.
in CA

Benefits Manager
for Wildman, Harrold, Allen & Dixon
in IL

Health & Welfare Consultant
for Benefits Consulting Firm
in MA

Newly Posted Webcasts
(Post Yours!)

Top 15 Pitfalls of Plan Administration
on November 20, 2002
presented by ASPA

Elections 2002: Congress and the States
on November 7, 2002
presented by Kaiser Family Foundation

Impact of the November Elections on U.S. Tax Policy
on November 13, 2002
presented by Clark/Bardes Consulting

Newly Posted Conferences
(Post Yours!)

Consumer-Driven Healthcare Winter Symposium
in FL
November 21, 2002
Global Business Research, Ltd.

Tiered Networks & Variable Co-Pays for Medical Services
in CA
December 12, 2002
Global Business Research, Ltd.

Health Reimbursement Arrangements - New Solutions for Consumer-Directed Healthcare
in TX
December 3, 2002
Employers Council on Flexible Compensation

Consumer-Directed Health Care: Are HRAs an Answer for Both Employers and Employees
in DC
March 13, 2003
Employers Council on Flexible Compensation

16th Annual Cafeteria Plan Symposium
in IL
August 13, 2003
Employers Council on Flexible Compensation

Pension & Retirement Savings Plans Fundamentals
in NY
November 12, 2002
New York Metropolitan Area Chapter - ISCEBS

Making Retirement Income Last a Lifetime...a marketing research study
in NY
November 14, 2002
New York Metropolitan Area Chapter - ISCEBS

Disease Management Summit
in FL
January 23, 2003
The Center for Business Intelligence

Newly Posted Press Releases
(Post Yours!)

SEPP Calculation Software Now Available
(ImagiSOFT, Inc.)

ORTEC Financial Writers Named Winners of the 2002 Dietz Award by the Journal of Performance Measurement
(ORTEC International)

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Editor and Publisher: David Rhett Baker, J.D.