March 30, 2005 Today's sponsor: Employee Benefits Institute of America (EBIA) (Click on company name or banner to learn more.) Explore the Seven Wonders of the Benefits Compliance World No HR or benefits professional's library would be complete without EBIA's compliance manuals. Save time and steer clear of compliance traps by joining thousands of professionals who rely on our manuals. "I know I can rely on your manuals, above and beyond any others, to be clear, concise, easy to understand, and accurate!" -Director of Flexible Benefits Learn more about EBIA's seven compliance manuals today! (Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor) Overview: Managing Plan Sponsor Investment Risk in 401(k) Plans Excerpt: "Every employer that sponsors a corporate retirement plan is a fiduciary, held to the highest standards of care and due diligence. The risks and responsibilities of plan sponsors in this regard are substantial but manageable. We discuss effective best practices that can help plan sponsors manage investment risk." (The McHenry Group) New Roth 401(k) Adds to Workers' Contribution Options Excerpt: "Whether it makes more sense to pay taxes now or at retirement is a question many workers will be pondering if their employers offer them a new Roth 401(k) investment option. .... Next year, the limit for contributing to 401(k) plans is $15,000, which includes both options. Anyone who wants to maximize their contribution to their 401(k) will have to divvy up their $15,000 limit between Roth and regular 401(k) plans." (AccountingWEB, Inc.) Commentary: Securities Class Action Settlements: Implications for ERISA Fiduciaries Excerpt: "Bruce Carton at the Securities Litigation Watch has been blogging for months about how ... institutional investors continue to leave millions of dollars on the table by failing to complete the basic tasks of monitoring and filing claims in securities class action settlements. .... He links to ... 'Leaving Money on the Table: Do Institutional Investors Fail To File Claims in Securities Class Actions?' [at http://law.wustl.edu/WULQ/80-3/p855CoxThomasbookpages.pdf] ...." (Attorney B. Janell Grenier via BenefitsBlog.com) Some Texas Counties Opted Out of Federal Social Security System -- How Did They Do? Excerpt: "The Galveston plan operates something like a 401(k): County employees in Galveston contribute 6.2 percent of their salary to the plan, with the county matching that amount plus as much as one additional percentage point. A private firm manages the employees' accounts and picks the annuities and bonds, which generally are not as risky as stocks. The plan also provides disability and life insurance." (South Bend Tribune) Working Paper: Lashed to the Mast? The Politics of Notional Defined Contribution Pension Reforms (PDF) 68 pages. Excerpt: "Over the past decade, a number of countries have adopted a new form of pension system known as 'notional defined contribution' (NDC) pensions. Like traditional defined benefit (DB) pensions, NDC pensions operate largely on a pay-as-you-go basis, but base benefits on total lifetime contributions rather than those in a specified number of peak earnings years." (Center for Retirement Research at Boston College) The Ideal Retirement Plan: Making Plans Work for Employers Excerpt: "When it comes to retirement plan design, one size definitely does not fit all. Advisors who neglect to ask 'Who does the employer want to benefit and why?' may not be providing the best service to their clients." (The McHenry Group) Opinion: Designer Social Security -- Give Us Individual Choices and Let Us Make the Decision Excerpt: "Call it 'Designer Social Security' -- create a system that gives us each options that let us create a system that is right for us. We are all adults. We get the point that the Social Security system can't pay us the benefits now on the books with the revenues slated to flow in during the coming decades. We know that something has got to give. That's why we are hesitant to buy into privatization in the first place until Bush explains how he will solve the basic problems of the system." (New York Post; one-time registration required) Links to Items on Executive Comp, Benefits in General Summary: SEC March 29, 2005, Release of SAB 107 on 'Share-Based Payments' Excerpt: "The U.S. Securities and Exchange Commission (SEC) released today, Staff Accounting Bulletin (SAB) 107, 'Share-Based Payments.' The interpretations in the SAB express views of the SEC regarding the interaction between FASB Statement 123(R), 'Share-Based Payment' and certain SEC rules and regulations and provide the SEC's views regarding the valuation of share-based payment arrangements for public companies." (Financial Executives International) SEC Gives Leeway in Measuring Employees' Stock Option's Value Excerpt: "The Securities and Exchange Commission upheld new rules requiring companies to count employees' stock options against profits but sweetened the pill for Silicon Valley by allowing for corporate latitude in measuring the value of the prized perks. Under guidelines issued Tuesday by the SEC, companies were told that to a reasonable extent, they didn't have to all use the same methods to value employees' stock options." (AP via The Washington Post; one-time registration required) SEC Accounting Bulletin Gives Range of Reasonable Conduct Acceptable in Stock Options Expensing Excerpt: "As expected, federal regulators on Tuesday released additional guidance on the new stock options expensing rule designed in part to ease fears that the system will be too hard to put into place. The Securities and Exchange Commission's (SEC) Office of the Chief Accountant and its Division of Corporation Finance released Staff Accounting Bulletin ... 107 about the Financial Accounting Standards Board's ... options expensing requirement scheduled to go into effect later this year ...." (PLANSPONSOR.com; one-time registration required) Commentary: 9th Circuit Decision on Severance Arrangements Excerpt: "Broc Romanek of TheCorporateCounsel.net Blog provides some interesting commentary on the recent case of SEC v. Gemstar-TV Guide International issued last week by the 9th Circuit which 'ruled en banc that severance payments - at least those in the 5x base salary range - are 'extraordinary payments' under the meaning of Section 1103 of Sarbanes-Oxley.' " (Attorney B. Janell Grenier via BenefitsBlog.com) Newly Posted Events Employee Benefits Conference in Illinois on May 24, 2005 presented by Illinois CPA Society Medical Affairs in District of Columbia on May 16, 2005 presented by American Conference Institute Mental Illness Disability Insurance Claims in New York on May 23, 2005 presented by American Conference Institute Obstetric Malpractice in Illinois on April 20, 2005 presented by American Conference Institute Pharmaceutical Benefit Management in District of Columbia on April 18, 2005 presented by American Conference Institute Sexual Harassment? 401(k) Plan Headaches? Payroll Tax Problems? in California on April 5, 2005 presented by Swidler Berlin LLP Welding Rod Litigation in Illinois on June 20, 2005 presented by American Conference Institute Newly Posted Press Releases Ten Common Mistakes Corporations Make When Designing Benefit Packages for Their Top Brass (Mullin Consulting) ICC Plan Solutions Hires Industry Sales Veteran to Lead New Business Development (Metrics Partners) Newly Posted or Renewed Job Openings Implementation Pension Analyst for CitiStreet in MA Trust Sales Administrator III for Regions Financial Corporation in IN, MO DC Conversions/Implementation for Recruiting Firm in MA Manager Integrated Absence Program for Kaleida Health in NY ERISA Senior Compliance Officer for Bank of America in MA ERISA Associate for Kilpatrick Stockton LLP in GA Plan Administrator / Client Account Manager for Northwest Plan Services, Inc. in WA Consultant - Health Plan Audit for Mercer Human Resource Consulting in CA Pension Actuarial Consultant for Louis Kravitz & Associates in CA Plan Administrator for Valley Forge Asset Management Corp. in PA Handy Links:
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