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August 5, 2005
Today's sponsor: APSCREEN, Employee Locator

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(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)
Chart with Summary and Comparison of Leading Single-Employer Pension Funding Proposals (PDF)
35 pages. The chart compares H.R. 2830 (Boehner), NESTEG (Grassley-Baucus), current law and the administration's proposal. (Benefits Group of Davis and Harman via American Benefits Council)

IRS Weighted Average Interest Rate Table Updated for August 2005
Weighted average for August 2005: 4.94% (U.S. Internal Revenue Service)

IRS Composite Corporate Bond Rate Table Updated for August 2005
Corporate Bond Weighted Average Interest Rate = 5.87 for August 2005 (U.S. Internal Revenue Service)

CIGNA Corp. Drawn Into Multistate Litigation Alleging Insurers Paid Hidden Kickbacks to Brokers
Excerpt: "[CIGNA has also] agreed to settle a smaller, unrelated lawsuit by employees over the company's 401(k) savings plan. In a regulatory filing Wednesday, the company disclosed that its Connecticut General Life Insurance Co. and Life Insurance Company of North America have been added as defendants in a consolidated lawsuit in a New Jersey federal court." (The Hartford Courant; one-time registration required)

Losing Track of 401(k) Plans and Plan Fees
Excerpt: "I'd love to see [an] easy give-and-take information exchange applied to 401(k) plan expenses, since losing track of these fees is a widespread phenomenon. Have you ever tried to figure out how much you're paying for the privilege of contributing to your employer's retirement plan? Chances are that you have no clue. The scary thing is, even plan sponsors -- those who are entrusted with the fiduciary responsibility of acting in the best interests of plan participants -- often do ...." (Bankrate.com)

Super Retirement Tools for National 401(k) Day, September 6, 2005, in English & Spanish
Excerpt: "The materials ... are available for free download, and may be customized and used in your company's 401(k) Day program." (Profit Sharing/401(k) Council of America)

Fidelity Study Shows 401(k) Investments Reach Five-Year High
Excerpt: "Fidelity's annual study on the state of its 401(k) plans, Building Futures, shows that average participant balances in 2004 were the highest since 1999 at $61,000. .... Building Futures is an analysis of nearly 8.6 million participants in approximately 10,800 defined contribution plans serviced by Fidelity as of the end of 2004." (PLANSPONSOR.com: one-time registration required)

Proposed FASB Staff Position: Reporting of Fully Benefit-Responsive Investment Contracts (PDF)
22 pages. Excerpt: "The Board directed the FASB staff to issue this FASB Staff Position (FSP) to (a) describe the limited circumstances in which the net assets of an investment company (also referred to hereinafter as a fund) should reflect the contract value (which generally equals the principal balance plus accrued interest) of certain investments that it holds and (b) provide a definition of a fully benefit-responsive investment contract." (Financial Accounting Standards Board)

Five Big Distribution Traps -- Costly Mistakes Can Hamper Retirement Savings Withdrawals
Excerpt: "Retirement-plan distribution mistakes can result in costly tax bites for retirement-plan owners or beneficiaries. And there are a lot of traps for the unwary. Here are what experts say are the top retirement-plan distribution traps and how to avoid them, or at least mitigate them." (MarketWatch, Inc.)

National Registry of Unclaimed Benefits Search Site Allows Searches for Unclaimed Retirement Funds
Excerpt: "This website is designed to help both the employer and the employee. Employees can perform a secure nationwide search, at no charge, to determine if they are entitled to any unpaid retirement account money. On the other hand, employers or plan sponsors can register the names of former employees who have unclaimed retirement funds left and have periodic searches done to find them." (PenChecks, Inc.)

Text: Lump-Sum Distributions and Retirement Income Security (Updated August 3, 2005) (PDF)
Excerpt: "While the lump-sum distributions that were not rolled over tended to be relatively small-- with a median value of $4,000, compared to a median value of $12,000 for lump-sums that were rolled over-- most were received by workers who were more than 20 years away from retirement. Consequently, many of these distributions could have grown to substantial amounts had they been rolled over into IRAs or other retirement plans." (Congressional Research Service via 401khelpcenter.com)

What Are Retirement Plan Participants Doing with their Lump Sum Distributions?
Excerpt: "An updated report issued by the Congressional Research Service (CRS) says that 84% of respondents who had received a lump sum distribution from their retirement plan had saved all or some of their distribution dollars." (PLANSPONSOR.com: one-time registration required)

District Court Judge Dismisses 401(k) Plan Company Stock Suit ERISA Litigation
Excerpt: "A federal judge has ruled that an employer's board of directors were barred from divesting the company stock of a company's K plan because information prompting such a move was still confidential. Rejecting decisions by several other federal judges that have found that insider trading rules would not be violated by the disclosure of nonpublic information to plan participants, US District Judge Ronald Whyte of the US District Court for the Northern District of California ...." (PLANSPONSOR.com: one-time registration required)

2005 US-UK Dialogue on Pensions Conference Held July 19-21, 2005
Excerpt: "The AARP Global Aging Program, in association with the British Embassy in the United States, the Employee Benefit Research Institute and the UK Department for Work and Pensions convened policymakers and experts from both sides of the Atlantic for the 2005 US -UK Dialogue on Pensions. [Speaker presentations and conference related research are available from this target page.]" (AARP)

U.K. Pension Fund Deficits Fell Sharply in July, According to Watson Wyatt Study
Excerpt: "A rise in British share prices to their highest levels in over three years sharply cut blue-chip companies' pension deficits in July, although shortfalls are still near January levels, pensions industry consultants Watson Wyatt said Thursday." (Reuters Limited via Business Insurance)

International Update, July 2005, Recent Developments in Foreign Public and Private Pensions (PDF)
4 pages. This edition has information on pension developments in Cyprus, New Zealand, Argentina, Brazil, and Colombia. (U.S. Social Security Administration)

Overview: Pensions in China Become Reality with the Enterprise Annuity System
Excerpt: "China's 'Enterprise Annuity' legislation has generated a good deal of interest since it was issued last year. But now the show really starts with the award of the first licenses to the financial institutions which will create the new pension fund industry. The Enterprise Annuity system is designed to supplement Social Security ...." (Watson Wyatt Worldwide)

Book Review: Profitable Socially Responsible Investing?: An Institutional Investor's Guide
Excerpt: "[Marc Lane's book Profitable Socially Responsible Investing?: An Institutional Investor's Guide] is a vital tool for institutional investors looking to conduct prudent and comprehensive due diligence in considering SRI, as it systematically addresses the most pressing questions." (CSRwire, LLC)

Overview: House Committee Approves ERISA Amendments through the Pension Protection Act of 2005 (PDF)
4 pages. Excerpt: "On June 30, 2005, the House Committee on Education and the Workforce approved the Pension Protection Act of 2005 (H.R. 2830) (the 'Bill'), which, if enacted, would make several amendments to the prohibited transaction rules of the Employee Retirement Income Security Act of 1974 ('ERISA'). The Bill also provides a definition of 'plan assets' and clarifies certain other ERISA requirements." (Dechert LLP)

Links to Items on Executive Comp, Benefits in General

JPMorgan Stock Option Plan Throws a Lifeline to Employees When Shares Are Underwater
Excerpt: "JPMorgan's program allows workers to get value out of worthless options and could benefit companies facing new rules on expense reporting." (Workforce Management; one-time registration required)

Workforce Aging Trend a Threat to the Utility Industry (PDF)
12 pages. Excerpt: "In this paper, [the authors] offer insight into the dilemma at hand, and outline what the utilities industry must do to come out on top. In particular, [they] focus on ways to attract new talent and ensure that experienced employees pass down their knowledge and expertise before retiring." (Hay Group; one-time registration required)

Proposed Electronic Participant Communications for Employee Benefit Arrangements-- Part Two
Excerpt: "The DOL issued final rules on electronic delivery (specifically, the delivery of ERISA-required participant disclosures such as SPDs) in 2002. This article compares the ERISA electronic rules with the newly proposed IRS rules." (McKay Hochman)

Proposed Electronic Participant Communications for Employee Benefit Arrangements-- Part One
Excerpt: "Scope of Regulation: The regulations only apply to employee benefit arrangement notices and elections and not to other IRS areas such as tax reporting, tax records or substantiation of expenses or COBRA. The IRS regulations will not cover areas within the authority of the department of Labor (DOL) and Pension Benefit Guarantee Corporation (PBGC). For example, DOL regulations provide the standards for employee benefit plan disclosures." (McKay Hochman)

States Act to Ease National Guard and Reserve Troops' Financial Pain While on Active Duty
Excerpt: "Thirty states and Puerto Rico have responded to the largest mobilization of the National Guard and Reserves since World War II by guaranteeing to make up the difference between civilian and military pay for state employees called to active duty." (Stateline.org)

Newly Posted Press Releases

ASPPA Eidson Award Recognizes G. Patrick Byrnes
(ASPPA (American Society of Pension Professionals & Actuaries))

Hewitt Associates to Provide HR BPO Services to Wachovia Corporation; Companies Expand Long-Standing Benefits Outsourcing Relationship
(Hewitt Associates LLC)

PSCA Provides New Materials for National 401(k) Day 2005
(Profit Sharing/401(k) Council of America (PSCA))

2006 Segal Health Plan Cost Trend Survey
(The Segal Company)

Social Security Turns 70 -- The Principal Financial Group Reflects on Contributions of Social Security, Recommends Workers and Retirees Alike Examine Their Financial Futures
(Principal Financial Group)

2005 eValue8 Behavioral Health Results Reveal Health Plans Struggle to Identify and Treat Mental Health and Chemical Dependencies
(National Business Coalition on Health)

NCQA To Develop Program That Will Help Improve Care For 31 Million Individuals With Chronic Back Pain
(National Committee for Quality Assurance (NCQA))

Ameriprise Retirement Services and Aon Consulting Form Alliance To Offer Comprehensive Retirement Plan Solution for Employers and Employees: Retirement3
(Ameriprise Retirement Services and Aon Consulting)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Pension Administrator/Calculation
for The Rosen Group, leader in placement of Benefits Professionals
in NC, VA

Compliance Consultant
for American United Life Insurance Company
in IN

Compliance Analyst
for Milliman, Inc.
in TX

Senior Pension Actuary
for Lynchval Systems Worldwide Inc
in VA

Vice President of Operations
for Associated Pension Consultants
in CA

Pension Consultant
for Associated Pension Consultants
in CA

Pension/Benefits Specialist
for RubinBrown LLP
in MO

Commercial Trust Plan Coordinator
for Marshall & Ilsley Corporation
in MO



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