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March 10, 2005
Today's sponsor: ASPPA • Working for America's Retirement™

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Immerse Yourself in ERISA Title 1 Issues
April 25 - 26, 2005 * Washington, DC
Get the latest regulatory and legislative updates on ERISA
at "The DOL Speaks 2005 Employee Benefits Conference." Every
session will feature both public and private sector speakers
presenting their unique perspective on Title 1 issues.
Featured Speaker: U.S. Secretary of Labor Elaine L. Chao

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Roth 401(k) Option Will Be Available to More Workers Next Year
Excerpt: "Workers disappointed that they can't contribute to a Roth IRA because their income is too high might be able to invest in a similar tax-friendly account next year through their employers." (The Baltimore Sun via Concord Monitor Online)

SEC Allows Mutual Funds to Charge for Market Timing
Excerpt: "The Securities and Exchange Commission will let mutual fund companies charge short-term investors fees if rapid trading hurts long-term investors. The new rule, approved Thursday, is an effort to curb market timing, a legal practice that can lead to high costs for long-term investors, such as 401(k) participants." (BenefitNews Connect)

New Rules Proposed for Abandoned 401(k) Plans
Excerpt: "The U. S. Department of Labor has proposed rules to allow financial institutions to take responsibility for abandoned 401(k) plans and distribute the plans' assets to workers and their families." (BLR.com)

DOL Proposes Financial Institutions Handle Abandoned 401(k) Plan Distributions
Excerpt: "Financial institutions would be allowed to take responsibility for the assets in the approximately 1,650 401(k) plans abandoned each year in order to distribute the money to workers and their families under a proposed DoL rule." (PLANSPONSOR.com; one-time registration required)

Comments to the Revised Regulations Concerning Section 403(b) Tax-Sheltered Annuity Contracts
Excerpt: "ASPPA believes that a written plan requirement will promote compliance with IRC §403(b) and increased usage of the IRS Employee Plans Compliance Resolution System (EPCRS). In addition, it is hoped that this requirement will lead the IRS to develop a determination letter program for 403(b) plans." (American Society of Pension Professionals & Actuaries)

Comments on Proposed Regs for Annual Funding Notice for Multiemployer Defined Benefit Plans (PDF)
2 Pages. Letter to the Employee Benefits Security Administration. Excerpt: "The American Academy of Actuaries' Multiemployer Plans Task Force appreciates the opportunity to respond to your request for comments regarding proposed regulations on the annual funding notice for multiemployer defined benefit pension plans, as required by Sec. 101(f) of the Employee Retirement Income Security Act (ERISA) and Sec. 103 of the Pension Funding Equity Act of 2004 (PFEA)." (American Academy of Actuaries)

PBGC Pending Proposed Rules on Electronic Premium Filing (PDF)
3 pages. (Federal Register)

PBGC Wants Mandatory Electronic Information Filing for Premium Determination
Excerpt: "The Pension Benefit Guaranty Corp. proposed Wednesday that employers be required to electronically file information that the PBGC uses to determine employer's PBGC premiums. Currently, employers have the option to file the information electronically." (Business Insurance)

DOL Fact Sheet: Abandoned Individual Account Plan Proposed Regulations and Class Exemption
Excerpt: "The proposed regulations establish standards for determining when a plan is abandoned, simplified procedures for winding up the affairs of the plan and distributing benefits to participants and beneficiaries, and guidance on who may initiate and carry out the winding-up process." (U.S. Employee Benefits Security Administration)

Overview: Mandatory Distributions: What Plan Administrators Need to Know (PDF)
Pages 5-7 of 8 pages. Excerpt: "If the Plan sponsor is unable to establish sufficient administrative procedures to accomplish the automatic rollovers by March 28, 2005, it will need to suspend making mandatory distributions exceeding $1,000 until such procedures are put into place. However, such procedures must be put into place and automatic rollovers must be made by December 31, 2005." (Dow, Lohnes & Albertson, PLLC)

Relying Upon a Directed Trustee? Retirement Plan Committees and Plan Sponsors Beware! (PDF)
42 pages. Analysis of the WorldCom Plan Participants vs. Merrill Lynch Trust Company Litigation Highlighting Limited Protection of Directed Trustee Services (Unified Trust Company)

Overview: Proposed Regs Explain New Design Option Available in 2006: Designated Roth Contributions
Excerpt: "The proposed regulations, when finalized, would apply to plan years beginning on or after January 1, 2006. The IRS has requested comments on the proposed regulations; the deadline for comments is May 2, 2005." (Employee Benefits Institute of America Inc.)

Private Accounts for Social Security Seen As 'Solution'
Excerpt: "The White House and top House Republicans yesterday refused to back away from personal savings accounts as a key component of reforming Social Security, despite misgivings by Democrats and some Republicans." (The Washington Times)

False Promise: How Social Security Privatization Would Sting Young Adults (PDF)
7 pages. Excerpt: "Advocates of Social Security privatization often argue that young adults would be better off when they retire if they could divert a portion of their Social Security payroll tax to private investment accounts. On the contrary, argues a new issue brief by Century Foundation program officer Libby Perl, today's young people would receive much lower guaranteed benefits with private accounts than they would under the current system." (The Century Foundation)

GAO Testimony: Social Security Reform: Early Action Would Be Prudent
29 pages. Testimony by David M. Walker, comptroller general of the United States, before the House Committee on Ways and Means, March 9, 2005. Highlights at http://www.gao.gov/highlights/d05397thigh.pdf (U.S. Government Accountability Office)

House Begins Work on Social Security Reform
Excerpt: "The House began its first formal work on restructuring Social Security yesterday with a hearing that featured testimony from the head of the investigative arm of Congress, who issued several warnings about the individual accounts proposed by President Bush." (The Washington Post; one-time registration required)

Links to Items on Executive Comp, Benefits in General

FAS 123(R) Requires Acceleration of Equity Compensation Cost for Retirement-Eligible Employees (PDF)
4 pages. Excerpt: "A ... provision in new FASB Statement 123(R) has come to our attention that, to our knowledge, has received no publicity. Specifically, if an employee who receives an equity award is retirement eligible, and the terms of the award are that any nonvested portion of the grant would accelerate or continue to vest at retirement, grant date compensation cost must immediately be recognized at grant, not accrued over the vesting period ...." (Frederic W. Cook & Co., Inc.)

SEC Will Provide Accounting Guidance: New Rules on Stock Options to Take Effect
Excerpt: "Securities and Exchange Commission Chairman William H. Donaldson told lawmakers yesterday that the agency would issue guidance this month to help companies comply with new rules on accounting for stock options." (The Washington Post; one-time registration required)

Overview of Annual Report and Proxy Statement Season (PDF)
12 pages. Excerpt: "To help you prepare for the upcoming annual report and proxy season, this issue highlights many of the changes you will need to consider in preparing your annual reports and proxy statements. (Originally published December 2004)" (Snell & Wilmer L.L.P.)

Fair Value Transfer: Alternate Approach to Measuring Aggregate Long-Term Incentive Grant Values (PDF)
13 pages. Excerpt: "Long-term incentive (LTI) compensation programs at public companies are in a state of flux. Companies have already started rethinking LTI compensation strategy in response to regulatory changes, shareholder pressures to constrain dilution, and market volatility over the past few years." (Frederic W. Cook & Co., Inc.)

Transcript: Nonqualified Deferred Comp –- Validating Section 409A Transition and Compliance Plans (PDF)
42 pages. 90 minute Webcast Sponsored by the Corporate and Securities Law Committee of the Association of Corporate Counsel, February 22, 2005 (Kilpatrick Stockton LLP)

Hewitt Federal Legislation Quick Guide Updated as of March 8, 2005
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." (Hewitt Associates)

7th Circuit Opinion on Class Certification Issue Involving an ERISA Section 510 Case
Excerpt: "In today's posting at Jottings By an Employer's Lawyer, Michael Fox discusses a recent 7th Circuit opinion written by Judge Richard Posner on a procedural issue involving an ERISA section 510 case--In Re: Allstate Insurance Company (7th Cir. 3/28/05) [pdf]." (Attorney B. Janell Grenier via BenefitsBlog.com)

Newly Posted Events

Final 401(k) Regulations presented by Janice M. Wegesin, CPC, QPA, President, JMW Consulting, Inc.
in Kentucky on March 29, 2005
presented by ASPPA Benefits Council of Greater Cincinnati

Health & Welfare Plan Management for Mid-Sized Employers
in Illinois on June 5, 2005
presented by University Conference Services

Mid-Sized Pension Management Conference
in Massachusetts on May 3, 2005
presented by University Conference Services

Pension Fund Conference Addresses the Importance of Positioning for Survival During the Looming Pension Fund Crisis
in New York on April 18, 2005
presented by Wall Street Transcript

The Future of Social Security and Implications for Higher Education
Nationwide on March 16, 2005
presented by NACUBO (National Association of College and University Business Officers)

Understanding The Formulary Requirements Under Medicare Part D
Nationwide on March 16, 2005
presented by Atlantic Information Services, Inc

Unlawful & Sexual Harassment in the Workplace
in California on April 19, 2005
presented by Precept Human Capital Management

Newly Posted Press Releases

PBGC Issues Two Rules On Electronic Filing Of Financial, Actuarial And Premium Information
(Pension Benefit Guaranty Corporation (PBGC))

Labor Department Proposes Rules to Help Workers In Abandoned 401(k) Plans
(U.S. Department of Labor, Employee Benefits Security Administration (EBSA))

Labor Department Proposes Rules To Help Workers In Abandoned 401(k) Plans
(U.S. Department of Labor, Employee Benefits Security Administration (EBSA))

Newkirk Introduces Rollover Solution for Mandatory Distributions
(Newkirk Products, Inc.)

National Employee Benefits Day is April 4
(International Foundation of Employee Benefit Plans)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Sales Representative
for Great-West Healthcare
in IL, KS, MO, TX

Retirement Plan/Recordkeeper Analyst
for WESPAC
in CA

AVP, Health Mgmt & Insurance Programs
for UnumProvident Corporation
in ME

Pension Plan Coordinator
for Transamerica
in CA

Sr. Benefits Analyst
for Sava Senior Care
in TX

Benefits Specialist
for NASD
in MD

Pension Administrator II - III
for Lawrence Johnson & Associates
in CA

401k Plan Administrator
for Compass Pension Partners, LLC
in WA

Consultant
for Fidelity Investments
in MA



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