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July 2, 2004
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)
PBGC Clarifies Prescribed Interest Rates Through 2005 (PDF)
Excerpt: "The Pension Benefit Guaranty Corporation (PBGC) has released welcome guidance in Technical Update 04-3, which eliminates some burdensome reporting and disclosure requirements for certain plan sponsors in 2004." (Mellon's Human Resources & Investor Solutions)

United's Pensions on Increasingly Shaky Ground
Excerpt: "As United Airlines prepares to ask workers for a new round of cutbacks, its pension plans look increasingly vulnerable. The airline has four big plans, and shedding any one could lop off more than $1 billion in debt." (New York Times; one-time registration required)

Counsel for the Non-Participant Should Be Wary of Plan-Supplied Model Domestic Relations Orders
Excerpt: "Many plans will provide attorneys a 'model order' for use in preparing a QDRO. And because of the need for a speedy resolution, many attorneys use them. But in most cases these 'model' orders are skewed in the favor of the participant (with whom the plan has an on-going fiduciary relationship)." (Paul R. Commerford on DivorceNet.com)

Both Sides at a Loss to Say Who Won Pension Fund Suit in Connecticut State Court
Excerpt: "In a seemingly paradoxical verdict, a Connecticut jury found in favor of the state's pension fund yesterday in its suit against one of Wall Street's most successful and colorful financiers and his firm, but refused to award the state any damages." (New York Times; one-time registration required)

Overview: IRS Delays Effective Date of Relative Value Regulations (PDF)
1 page. Excerpt: "The original effective date, however, still applies to lump sums or other optional forms subject to Section 417(e)(3) that are less valuable than the QJSA." (Mellon's Human Resources & Investor Solutions)

Update on 'Relative Value' Regulations and SunGard Corbel Forms
Excerpt: "The postponement of the regulations with respect to QJSA explanations will apply to all defined contribution plans and to most defined benefit plans. The postponement does not apply to QJSA explanations for defined benefit plans where the plan permits distributions that are subject to IRC ยง417(e)(3) (e.g., lump-sum distributions) and the present value of such distributions are less than the value of the QJSA." (SunGard Corbel)

Texas Teachers Turn to Janitor Work to Qualify for Benefit
Excerpt: "Thousands of teachers retiring from their jobs in Texas do one day of janitor work, part of a deal that will allow them to claim Social Security. The teachers, who don't pay into the Social Security system, did the work to take advantage of a government offer that will gives them benefits along with their own pensions. Hear NPR's Wade Goodwyn." (National Public Radio)

Text of Public Comments to PBGC on Assessment of and Relief from Participant Notice Penalties (PDF)
6 comments, including a letter from the American Benefits Council. Three cheers for the PBGC's decision to make these comments available on the Internet! (Pension Benefit Guaranty Corporation)

How Can the Actuarial Reduction for Social Security Early Retirement Be Right? (PDF)
Excerpt: "On a lifetime basis, the late claimer now comes out ahead. The only way to restore balance at the new life expectancy is to have a smaller adjustment. But, in fact, the 5/9 reduction factor has remained constant. Why? The answer has to do with interest rates." (Center for Retirement Research at Boston College)

TIAA-CREF Participant Premium and Asset Allocations from 2000 to 2004
Excerpt: "This article ... examines how TIAA-CREF participant asset allocations have changed since the stock market peaked in 2000." (TIAA-CREF Institute)

Opinion: Unregistered Annuities-- the Seamy Side of Insurance
Excerpt: "Unregistered annuities often pay big commissions and have long surrender periods -- and their agents may be preying on unsuspecting seniors. Here's how to protect your clients. You've seen the pitches: 15 percent commissions on annuities with 15-year surrender charges. Welcome to the world of non-registered annuities, where clients can easily be talked into buying uncompetitive products by loosely regulated agents -- 'annuity whores,' as one critical broker calls them." (On Wall Street)

When the U.S. Attorney Comes Knocking at the Plan Trustee's Door
Excerpt: "Private Letter Ruling 200426027 ... expresses the IRS's views regarding many of the questions practitioners have had in connection with a recent phenomena in the benefits world-- that of U.S. attorneys seeking to levy against qualified plan assets pursuant to the Federal Debt Collection Procedures Act of 1977 ('FDCPA')." (Attorney B. Janell Grenier on BenefitsBlog)

Links to Items on Executive Comp, Benefits in General

Survey of Executive Severance Practices
Excerpt: "In April 2004, Hay Group conducted a survey of severance policies applicable to senior executives in the normal course of business activities.... We were particularly interested in the extent to which companies used contractual arrangements to implement executive severance policies that extended beyond broad-based severance programs." (HayGroup)

Financing of Employee Benefits Hits the HR Classroom
Excerpt: "Years of talk about how benefit managers should be strategic partners with top management has missed one important step. Most benefit managers still deal with the soft side of HR-- administration and employee communication-- and leave benefit finance to accountants. The result is many HR managers get left out of major decisions made by their companies." (BenefitNews.com)

Hewitt Federal Legislation Quick Guide: June 29, 2004
Excerpt: "Hewitt's Federal Legislation Quick Guide provides short updates on federal legislation that is currently under active consideration by Congress or has recently been enacted into law, regarding health and welfare benefit plans, retirement plans, and human resources and employment law. Click ... to learn more about pending legislation in each area. These files were updated on June 29, 2004." (Hewitt)

Text of Papers Presented to Society of Actuaries Symposium on Managing Retirement Assets
Papers include 'Real Longevity Insurance with a Deductible: Introduction to Advanced-Life Delayed Annuities,' 'Immediate Annuity Pricing in the Presence of Unobserved Heterogeneity,' 'Annuitization: Keeping Your Options Open,' 'Full Circle: Purchasing Insured Annuities in a Defined-Benefit Plan,' 'Managing Longevity Risk in U.S. Retirement Plans through Mandatory Annuitization,' 'Assessing Long-Term Care Risk and Long-Term Care Options,' more. (Society of Actuaries)

SEC Chief Accountant Open to Delaying Stock-Options Expensing
Excerpt: "Securities and Exchange Commission Chief Accountant Donald T. Nicolaisen said Tuesday that he would entertain the idea of giving companies another year to gear up for a final rule on expensing stock options." (AccountingWEB)

GAO Supports FASB's Action on Stock Option Expense Rules
Excerpt: "In a letter this week to the Financial Accounting Standards Board (FASB), David M. Walker, Comptroller General of the United States gave full support to the proposed statement requiring companies to record share-based payment as an expense." (AccountingWEB)

Overview: Retiree Health Coverage Waiver Is Employer-Initiated Reduction in Coverage (PDF)
2 pages. Excerpt: "The IRS recently ruled that the waiver of retiree health coverage in exchange for enhanced pension benefits could be deemed an employer-initiated reduction in coverage for purposes of Internal Revenue Code Section 420. Thus, the employer could fail to satisfy the cost maintenance requirements necessary for a qualified transfer of excess pension assets to a retiree health benefits account." (Mellon's Human Resources & Investor Solutions)

Newly Posted Events

Fundamentals of 401(k) Plans
in Ohio on September 14, 2004
presented by SunGard Corbel

Fundamentals of 401(k) Plans
in Indiana on September 23, 2004
presented by SunGard Corbel

Fundamentals of 401(k) Plans
in Illinois on September 30, 2004
presented by SunGard Corbel

Fundamentals of Qualified Plans
in Kansas on September 23, 2004
presented by SunGard Corbel

MEDICAID DRUG REBATE CONGRESS 2004
in District of Columbia on August 24, 2004
presented by International Quality & Productivity Center (IQPC)
Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Defined Benefit Client Account Manager
for New York Life Investment Management LLC
in MA

Client Services Manager
for ICMA Retirement Corporation
in DC

Associate Actuary
for State of Washington
in WA

Benefits Administrative Services Manager
for RSI
in NJ

Retirement Account Executive
for Principal Financial Group
in NY

Account Executive - Retirement Services
for Principal Financial Group
in NY

Retirement Education Account Executive
for Principal Financial Group
in OH

401k External Wholesaler (Mid Atlantic Region)
for ADP Retirement Services
in MD, NH, NJ, NY, PA, RI, VT

401(k) Administrator
for Continental Benefits Group, Inc.
in NJ

Director of Underwriting Services
for Craford Benefit Consultants
in CA

Employee Benefits Attorney (509 BW)
for Marvel Consultants, Inc.
in IL

Third Party Pension Administrator
for THOMAS, DOLL & COMPANY, CPAs
in CA

Plan Administrator
for DC Pension Consultants, LLC
in NJ

Operations Administrator - Multiple Openings
for Mellon Financial Corporation - Human Resources & Investor Solutions
in MA

Pension Plan Administrator
for Klinger & Associates, Inc.
in MN

Senior Director, Research
for International Foundation
in WI

Health & Welfare Customer Service Associate
for Fidelity Investments
in MA, NH, TX

Paralegal
for National Benefit Fund for Hospital and Health Care Employees
in NY

Pension Portability Specialist
for ICMA Retirement Corporation, a non-profit, mutual fund organization
in DC

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