| BenefitsLink Retirement Plans Newsletter |   |
April 18, 2003 - 13,053 subscribers
Today's sponsor: Actuarial Systems Corporation
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ASC - QUALITY SOFTWARE FOR THE PENSION INDUSTRY FOR OVER 20 YEARS ASC provides complete automation for the pension office, including: DC/401(k) and DB administration and valuation systems, sophisticated Compliance Testing, DV Direct Daily Valuation, Advanced Information Manager Database (AIM), and Single-Step Processing. All ASC Technical Support Members were experienced Pension Administrators or Actuaries before joining ASC -- and most have been with ASC for over 10 years.
(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Portman-Cardin Pension Bill May Benefit Employees and Employers
Excerpt: "[T]he 207 pages of largely inscrutable technical language includes an array of provisions that benefit employers, financial companies, and executives. If passed, employers could pay departing workers smaller lump-sum pensions, contribute billions of dollars less to ailing pension plans, have greater latitude to establish separate but unequal retirement plans for favored and less-favored workers, and continue to protect executive pensions in bankruptcies, among other things." (The Wall Street Journal via SFGate.com)
Analysis: Otherwise Excludible Employee and Early Participation Rules
Excerpt: "The advantage to the employer in offering early eligibility in a 401(k) plan is that the employer can provide a popular low cost benefit to the employees. The disadvantage of offering early eligibility is that part-time and short-term employees become eligible to participate. Since the part-time and short-term employees almost always are nonhighly compensated employees (NHCEs) and usually defer less than other NHCEs, the plan may have difficulty in passing the ADP test." (SunGard Corbel)
2003 Milliman USA DB Pension Survey Shows Most Large Plans Underfunded
Excerpt: "In a distinct turnaround from the recent past, most large company defined benefit pension plans have become under funded because of market conditions, Milliman's 2003 survey of large defined benefits plans has reported. Of the 100 large plans surveyed 87 were in a deficit position in 2002. This compares with 60 in 2001 and 20 in 2000." (Milliman USA)
Defense Companies Getting Special Government Help with Pension Deficits
Excerpt: "[I]n a quirk of defense contracting, the Pentagon is obligated to make up most of the pension deficits for companies that make the military's fighter jets, tanks and bombs. Under federal statute, the companies include estimates of pension costs in most of their large government contracts. And now, in the face of pension troubles, the contractors have begun alerting the Pentagon that they will raise prices to account for the shortfalls they are forecasting." (Washington Post)
Retirement Age and Social Security Reform: the Macroeconomic Effects of Working Longer
Excerpt: "Many plans to restore long-term solvency to the Social Security system include a proposal to raise the age of eligibility for full retired worker benefits, known as the normal retirement age. The objective of this AARP Public Policy Institute Issue Brief by Satyenda Verma and Sara E. Rix is to determine how Social Security benefits, the trust funds, compensation, income, and savings would be affected if the labor force participation rate of older persons were to rise." (AARP Research)
Analysis: OASDI Trust Funds-- 2003 Trustees' Projections
Excerpt: "While the combined trust funds are sufficient to pay full benefits for the next 39 years, the Trustees also report that both OASI and DI programs continue to face long-term deficits." (AARP Research)
Overview: DOL Issues Guidance Regarding 401(k) Loans to Officers and Directors
Excerpt: "Field Assistance Bulletin 2003-1 ... provides that a decision to disallow a loan based on a reasonable question concerning the legality of the loan would not be a failure to make loans available on a reasonably equivalent basis. The Bulletin then goes on to state that, given the uncertainty surrounding the scope of Section 402, plan fiduciaries of public companies may disallow plan loans to directors and executive officers of the company." (LeBoeuf, Lamb, Greene & MacRae, L.L.P.)
IRA Reporting Deadlines Looming for IRA Custodians, Trustees and Annuity Issuers
Excerpt: "Generally, you file Form 5498, on or before May 31 for each person for whom you maintained an IRA during the previous year. However, if May 31 is not a regular business day the deadline is the next business day. For 2003, the deadline will be June 2." (Bankers Systems Inc.)
Small Business Resource Guide: Retirement Plans for Small Businesses
Excerpt: "An online version of the Retirement Plans portion of the 2003 Small Business Resource Guide CD. This extract (with updates) contains information useful in choosing an appropriate retirement plan." (Internal Revenue Service)
French Pension Reform Plans Bring Strike Threat
Excerpt: "One of Friday's proposals was to introduce tax incentives to make private retirement savings schemes more attractive. Such programmes are viewed as risky in France. Unions say they would place an added financial burden on workers at a time when unemployment is high ..." (Reuters)
One or More Authors Needed to Host QDRO Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for plan sponsors. If you're interested in hosting a new QDRO column for participants and alternate payees, let me know that, too! Thanks -- Dave Baker, Publisher (BenefitsLink.com)
One or More Authors Needed to Host Fiduciary Investing Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for plan sponsors. Thanks -- Dave Baker, Publisher (BenefitsLink.com)
One or More Authors Needed to Host Professional Liability Insurance Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for third-party plan administration firms. Thanks -- Dave Baker, Publisher (BenefitsLink.com)
One or More Authors Needed to Host Advanced Retirement Plan Design Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for plan sponsors. Thanks -- Dave Baker, Publisher (BenefitsLink.com)
Links to Items on Executive Comp, Benefits in General
CIGNA Publishes Compliance Checklist 2003 for DB, DC and Nonqualified Executive Benefit Plans (PDF)
24 pages; marvelous. Designed for use by CIGNA clients, but most of the information is applicable to plan sponsors generally. Excerpt: "The Checklist ... provides information on the materials that you will need to file, filing due dates, and agencies to which filings should be made. In addition, we've identified how CIGNA can help you complete each task, so you can rest assured you have what you need to meet government filing requirements." (CIGNA's Pension Analyst(R), Special Edition)
American Airlines Union Up in Arms Over Disclosure of Trust for Supplemental Executive Benefits
Excerpt: "Mechanics and ground workers may have thrown a wrench into labor concession deals aimed at heading off a bankruptcy filing at American Airlines when their union leadership threatened on Thursday not to sign the pact over a dispute on executive compensation." (Reuters via Yahoo! News)
AP Coverage of American Airlines Flap Over Use of Trust for Executives' Supplemental Benefits
Excerpt: "The executives' deal, which includes a pension fund that protected the benefits of top executives in case of bankruptcy, was disclosed in a filing with the Securities and Exchange Commission by American's parent, AMR Corp.... 'It's the equivalent of an obscene gesture from management,' said John Ward, president of the flight attendants' union." (AP via SFGate.com)
NY Times Coverage: Unions at American Airlines Criticize Executive Pensions
Excerpt: "Union leaders at American Airlines yesterday denounced the company's disclosure on Tuesday night that it had set up a trust fund to protect top executives' pensions if the company went into bankruptcy and that it planned to pay bonuses to several executives for staying with the company until 2005." (New York Times; one-time registration required)
GM Top Execs to Receive No Bonuses This Year
Excerpt: "General Motors Corp.'s top executives will receive no cash bonus for their performance last year, the world's No. 1 automaker said on Thursday, as concerns about the shaky economy outweighed the sterling results they delivered in 2002." (Reuters via Yahoo! News)
Ethical Considerations for Trustees of Multiemployer Plans (PDF)
7 pages. Excerpt: "Several committees of the International Foundation of Employee Benefit Plans have worked to develop a list of ethical considerations that may be beneficial to Trustees in analyzing various courses of action. This document will be used at future educational sessions on the topic of ethics." (International Foundation of Employee Benefit Plans)
Expensing Stock Options Already Factored Into Company Stock Prices, Watson Wyatt Analysis Finds
Press release. Excerpt: "Mandating stock option expensing should have little, if any, effect on a company's stock price, according to a new analysis by Watson Wyatt of 800 publicly traded companies in the S&P 1500." (Watson Wyatt)
One or More Authors Needed to Host Deferred Comp Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for plan sponsors. If you're interested in hosting a new QDRO column for participants, let me know that, too! Thanks -- Dave Baker, Publisher (BenefitsLink.com)
One or More Authors Needed to Host Mergers and Acquisitions Q&A Column on BenefitsLink
Drop me an email with your qualifications if you're interested! The column focuses on questions from or for plan sponsors. Thanks -- Dave Baker, Publisher (BenefitsLink.com)
Newly Posted or Renewed Job Openings
Fun & Challenging DC Compliance Position
for Louis Kravitz & Associates, Inc.
in CA
Consulting Actuary
for Management Recruiters of Wildwood
in AZ, CA, CO, CT, DC, FL, GA, IL, MA, MI, MN, MO, NC, NY, OH, PA, RI, TX, WA, WI
Health and Welfare Consultant
for Management Recruiters of Wildwood
in AZ, CO, CT, DC, FL, GA, IL, MA, MI, MN, MO, NC, OH, PA, RI, TX, WI
Manager Health & Welfare Benefits
for ABM Industries Incorporated - San Francisco
in CA
New Fellow or Associate Actuary
for Milliman USA
in CO
Conversion Specialist
for Retirement Alliance, Inc.
in NH
Pension Administrator
for Lurie Besikof Lapidus & Company, LLP
in MN
Newly Posted Conferences
(Post Yours!)
CBI's 2nd Annual Employer Summit on Managing Healthcare Costs and Quality
in DC
May 19, 2003
The Center for Business Intelligence
CBI's Inaugural Forum on Captives and Alternative Risk Financing for Medical Liability Coverage
in IL
July 28, 2003
The Center for Business Intelligence
The World Congress Leadership Summit on Healthcare Quality & Performance Contracting
in MA
August 11, 2003
World Congress
Benefit Management Academy
in FL
May 23, 2003
Benefit Management Group
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