December 6, 2005 Today's sponsor: www.ftwilliam.com (Click on company name or banner to learn more.)
Overview: Defined Contribution Proposals Included In Defined Benefit Legislation Excerpt: "In this article, [CCA Strategies reviews] the defined contribution legislative initiatives included in Senate and House DB reform proposals. Many of these DC proposals enjoy broad support and may find their way into a final DB funding bill or other legislation." (CCA Strategies) Roth 401(k) Status as of December 1, 2005 Excerpt: "With the passage of EGTRRA and the creation of the Roth 401(k) in the first half of 2001, nobody at that time imagined that we could reach December 1, 2005, without the IRS releasing the necessary guidance to implement the Roth 401(k)." (McKay Hochman Co., Inc.) Overview: Safe Harbor Plan with Cross-Tested Allocation Excerpt: "May a Safe Harbor 401(k) plan with a cross tested profit-sharing allocation use the safe harbor 3% contribution and an additional 2% nonelective contribution with allocation restrictions such as a last day or 1,000 rule to satisfy the 5% gateway test?" (McKay Hochman Co., Inc.) Retirement Plan Accounting Assumptions at Year-End 2005 (PDF) 8 pages. Excerpt: "This report is an update to [Hewitt's] Global Survey of Retirement Plan Accounting Assumptions report." (Hewitt Associates) Opinion: Why the PBGC Can't Afford Free Forensic Audits Excerpt: "[The Benchmark Companies] believe, based upon hundreds of investigations, that pension fraud and mismanagement is pervasive; the PBGC simply lacks an understanding of what constitutes fraud and mismanagement in the pension context and is not looking for it." (The Benchmark Companies) South Carolina High Court Hears TERI Appeal Excerpt: "The South Carolina Supreme Court ... heard oral arguments in a challenge to a new state law requiring payroll retirement contributions from state retirees who return to work under a special incentive program." (PLANSPONSOR.com; one-time registration required) Letter from Senate Aging Committee to Treasury Secretary Snow Regarding Phased Retirement (PDF) 3 pages. (U.S. Senate Special Committee on Aging) The Public Company ESOP in 2004 (PDF) 14 pages. The article focuses on the fiduciary questions surrounding the investment of pension plan assets in employer stock and the lessons learned from recent events. (Journal of Pension Planning and Compliance via Groom Law Group) Opinion: An Explanation for Public Pension Boards' Opposition to Consultant Investigations? Excerpt: "Public pensions that resist inquiries into the integrity of any parties involved in pension decision-making appear as if they have something to hide. When the truth eventually and inevitably does come out, many funds may find that the problems they have been concealing are far worse than they imagined." (The Benchmark Companies) Another Question is Answered in the Who's the Employer Q&A Column So when are you going to come out with the 4th Edition of Who's the Employer? It's been three years since the last edition. (BenefitsLink.com) Overview: Maximum Deferral and Threshold Limits for 2005 and 2006 (PDF) 3 pages. The chart includes the IRC section numbers for each dollar limit. (Gabriel, Roeder, Smith & Company) Enterprise Risk Mgmt: Equities in Defined Benefit Plans -- Is the Traditional 60/40 Mix a Dinosaur? (PDF) 6 pages. Excerpt: "Boots' drastic change in investment strategy was a fantastic exercise in application of enterprise risk management (ERM). .... Now, with four years passed, let's examine Boots' decision within the current environment, including why companies should review their asset allocation from a risk management perspective and offer insights on why companies-- even given the strong evidence-- are still not prepared to go all the way to bonds." (Employee Benefit Plan Review via Argus Consulting Ltd) Bush Reminds Companies of Pension Promises Excerpt: "President Bush said [December 5] that American companies must honor promises to their retired workers, and he urged Congress to pass tough legislation so retirees don't see their pension checks slashed." (AP via The New York Times; one-time registration required) Verizon to Halt Pension Contributions for Managers Excerpt: "Verizon Communications, the nation's second-largest telephone company, said yesterday that it would freeze the guaranteed pension plan covering 50,000 of its managers and expand their 401(k) plans instead." (The New York Times; one-time registration required) ADP and Fidelity Accused of Fraud Excerpt: "A mortgage broker has accused Automatic Data Processing Inc. (ADP) and Fidelity Investments in Boston of defrauding small business retirement plans." (PLANSPONSOR.com; one-time registration required) Overview: Last Day of the Plan Year Excerpt: "When December 31st falls on a Saturday, as it does this year, is December 30th treated as the last day of the plan year? Generally, yes according to the Internal Revenue Service (IRS)." (McKay Hochman Co., Inc.) Towers Perrin U.S. Legislative Tracking Charts-- Retirement-- Updated November 30, 2005 (PDF) 17 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin) Links to Items on Executive Comp, Benefits in General GRS Insight -- September 2005 (PDF) 6 pages. The newsletter includes articles titled: IRS Proposes Regulations on 415 Limits; Achieving Good Pension Governance; and, Advantages of Trusts for Funding Retiree Health Care. (Gabriel, Roeder, Smith & Company) Major Changes in Store for Pension and OPEB Accounting (PDF) 3 pages. Excerpt: "The Financial Accounting Standards Board (FASB) voted unanimously on November 10 to start a comprehensive project aimed at redoing accounting for pensions and other postretirement benefits (OPEB).The first phase of the project, which is likely to result in changes to 2006 financial statements, will only affect the balance sheet. The second phase is likely to last for three or more years and will address measurement issues and the income statement." (Buck Consultants) Older Workers: Labor Can Help Employers and Employees Plan Better for the Future 60 pages. Excerpt: "Due to the growing importance of workers aged 55 or older, GAO examined: (1) areas of the labor market affected by the aging of the workforce; (2) factors that influence the timing of retirement; and (3) what employers are doing to hire and retain older workers. [Highlights of the report are at http://www.gao.gov/highlights/d0680high.pdf.]" (U.S. Government Accountability Office) 2005 Plan Year-End Planning Checklist for Advisors, Employer/Plan Sponsors and Fiduciaries Excerpt: "This article identifies year-end administrative, compliance and planning issues that require attention within the general timeframe indicated." (ERISA Expertise LLC) Employer Not Blocked from Correcting Benefits Level Excerpt: "A federal appeals court has tossed out a lower court ruling that an employer was blocked from correcting a miscalculated pension benefit level. The US 5th Circuit Court of Appeals ruled that while the Employee Retirement Income Security Act (ERISA) might block certain plan administration actions, that plaintiff Frank Mello had not sufficiently proven the legal theory of estoppel - the mechanism that would be involved." (PLANSPONSOR.com; one-time registration required) Hurricane Guidance Scorecard Excerpt: "The differences between the guidance for the Katrina Emergency Tax Relief Act (KETRA) and the IRS/DOL and PBGC guidance are important to understand." (McKay Hochman Co., Inc.) Deferred Compensation under 409A: Highlights from Proposed Regulations Excerpt: "This alert highlights selected issues from the proposed regulations and is intended as a companion piece to the action items featured in [the] alert Deferred Compensation Under 409A: Action Items." (Hodgson Russ LLP) Deferred Compensation under 409A: Action Items Excerpt: "Proposed regulations addressing the application of IRC § 409A to nonqualified deferred compensation have been issued. This benefits alert identifies those actions that must be taken before the end of 2005 and offers an action plan for 2006. " (Hodgson Russ LLP) Towers Perrin U.S. Legislative Tracking Charts-- Human Resources-- Updated November 30 2005 (PDF) 9 pages. Excerpt: "These charts summarize selected federal legislation that would affect employee benefit programs. The bills included on the charts are based on judgments regarding the prominence of the issue, the likelihood of enactment, and the influence of the sponsors." (Towers Perrin) Trucker Huss November 2005 Benefits Report (PDF) 6 pages. This edition includes articles titled: Continuing Notice Obligations under Medicare Part D; and, Two Recent Court Decisions Remind Plans to Exercise Caution in Handling Contested Benefit Claims. (Trucker Huss) Newly Posted Press Releases More Companies Implementing Health and Productivity Practices, Watson Wyatt and National Business Group on Health Survey Finds (Watson Wyatt) Letter To Congress Regarding EGTRRA Permanency - Thank You, Chairman Thomas (Profit Sharing/401(k) Council of America (PSCA)) Trustmark Mutual Holding Co., Charles Schwab and Alliance Benefit Group Unite To Bring Consumers More HSA Investment Options (TrustMark) Dallas-Fort Worth Business Group on Health Hosts Inaugural Health Worksite Wellness & Disease Management Event (Dallas-Fort Worth Business Group on Health) Ftwilliam.com Releases Roth 401(k) Amendment (ftwilliam.com) Newly Posted or Renewed Job Openings Director of Account Management for Health Insurance Carrier for Great-West Healthcare in OH Compliance Consultant - AZ for Vanguard in AZ Administrative Associate - Retirement Plan Services for Simpkins & Associates in TX Manager Benefits Planning & Strategy for World-renowned cultural institution in NY Account Executive for Great-West Retirement Services in NJ 401(k) Administrator for Retirement Plan Consulting Firm in Westchester County, NY in NY Installation Administrator for Transamerica in CA Taft Hartley Defined Benefit Pension Assistant Administrator for GCC/IBT-SRDF in IL Regional Sales Director for BISYS Retirement Services in AZ, CA, CO, IA, ID, KS, MN, MT, ND, NE, NM, NV, OK, OR, SD, TX, UT, WA, WI, WY Defined Contributions Testing Specialist for Constantin Control Associates in RI Handy Links:
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