Retirement Plans
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February 1, 2006
Today's sponsor: Penchecks, Inc.

(Click on company name or banner to learn more.)
Banner ad for Penchecks, Inc.

The National Registry has arrived!

It is a web-based service designed to reunite plan participants with their unclaimed retirement benefits. Since going live on May 27, 2005, over 10,000 participant names with unclaimed pension benefits have already been registered. Plan Administrators and IRA custodians may register their missing participants in the National Registry’s database for a nominal fee. Participants are able to check the database online. If a match is found, contact information is provided. There is no charge to individual participants to use the service to search for unclaimed retirement benefits that are owed to them. The National Registry facilitates Win-Win situations - Plan Sponsors alleviate themselves of reporting burden and fiduciary responsibility when lost participants claim their money and Former Plan Participants end up with more money!

All Automatic/Default/Missing Participant IRAs established through PenChecks, Inc. are automatically included in the National Registry database at no additional cost.

For more information, click on the link above or call (877) 462-2745.

(Please visit our sponsors. We try to make sure their products and services will be of interest to you. Thanks! --Editor)

401(k)s, Post-Enron: Are Workers Better Off?
Excerpt: "As corporate cautionary tales go, the demise of Enron wins the Holy Moly Prize in every way, but no way more so than as a nightmarish illustration of the risks of having too much company stock in your 401(k).Enron workers lost the lion's share of their retirement money as the company's once-high-flying stock became all but worthless by the end of 2001." (

West Virginia Cities' Police and Firefighter Pensions In Big Trouble
Excerpt: "West Virginia cities are operating with shortfalls in their police and firefighter pensions that add up to more than a half billion dollars. Actuarial analyses from 2004 compiled by the state Treasurer's office show the majority of the cities have severely under-funded pension systems - the worst being Charleston and Huntington, which also have the largest forces of uniformed civil servants." (Charleston Daily Mail via

Opinion: Congress May Turn Its Attention to Pension Reform This Week
Excerpt: "[I]t seems reasonable to anticipate some kind of action on the legislative front, at least by April. Most of the focus has been on reforms targeted at defined benefit plans, and that's reasonable in view of the very serious issues regarding pension funding and the apparently precarious funding situation of the Pension Benefit Guaranty Corporation (PBGC, which insures those precariously funded programs (as well as the not-so-precariously funded ones)." (; one-time registration required)

Pension Fund Asset Growth Outpaces Liabilities in 2005
Excerpt: "Growth of institutional pension assets in 2005 in the 11 major markets, measured in local currencies, was around 17 per cent (up from seven per cent in 2004) according to Watson Wyatt and assets now total US$16.4 trillion. During the year, pension fund liabilities* also increased by approximately nine per cent on average in local currency terms, ...." (Watson Wyatt Worldwide)

Overview: New Law Exempts Plan Loans from Bankrup.tcy
Excerpt: "The Bankrup.tcy Abuse Prevention and Consumer Protection Act of 2005,1 which became effective on October 17, 2005, exempts loans to an employee from a tax-qualified retirement plan, such as a 401(k) plan, from the bankrup.tcy process." (BNA Tax Management)

Opinion: Assessing the Fallout in Domestic Partnership Pension Case in New Jersey
Excerpt: "Now that retired Ocean County Prosecutor's Office Lt. Laurel Hester's wish has been granted and her pension awarded to her domestic partner, it is well to take stock of the winners and losers in this sad episode." (Asbury Park Press)

PERA Reform Bill Introduced in Colorado Legislature
Excerpt: "Colorado state Senator Dave Owen has introduced the first of three expected bills designed to reform the Colorado Public Employees' Retirement Association (PERA)." (; one-time registration required)

Final Cross-Border Regulations to Implement EU Pensions Directive Laid before UK Parliament
Excerpt: "All European Union (EU) Member States were required to implement Directive 2003/41/EC - known as the EU Pensions Directive-- into their domestic law by 23 September 2005." (Watson Wyatt Worldwide)

Australia: Recent Developments in Superannuation
Excerpt: "It may not be widely known that the Federal Government's 'Work Choices' Workplace Relations changes may have an impact on the provision of superannuation benefits by some employers." (Watson Wyatt Worldwide)

Bush Renews His Focus on Social Security in State of the Union Speech
Excerpt: "Frustrated by Congress' refusal to consider his Social Security overhaul, Bush switched gears and asked lawmakers to join him in naming a commission to examine the impact of Baby Boom retirements on Social Security, Medicare and Medicaid costs." (AP via Yahoo! News)

IRS Listing of Published Guidance Relating to Retirement Plans for January 2006
The provided materials relate specifically to retirement plans: Treasury Regulations; Revenue Rulings; Revenue Procedures; Notices; and, Announcements. (U.S. Internal Revenue Service)

Retirement Plan Fees Expected to Continue Dropping this Year
Excerpt: "The mutual fund scandals and a series of investigations into the financial industry by New York Attorney General Elliott Spitzer have caused retirement plan fees to drop since 2003. These fees will continue their fall in 2006, experts say." (Employee Benefit News)

Text of Speech of Assistant Secretary of Labor Ann L. Combs on January 6, 2006
This text covers automatic enrollment and fees. (MJM Financial, LLC)

Council Issue Paper on Hybrid Plan Designs (PDF)
2 pages. Excerpt: "Given the overwhelming authority supporting the validity of the hybrid pension designs and the broad consensus that hybrid plans serve employee needs, inclusion in the pension conference agreement of a comprehensive confirmation as to the validity of these designs would be a straightforward step." (American Benefits Council)

Links to Items on Executive Comp, Benefits in General

Overview: FASB Proposals on the Accounting Treatment of Options that May Be Settled in Cash (PDF)
2 pages. Excerpt: "The proposed amendment clarifies FASB's position that options granted under option plans providing for a cash-out election or automatic cash-out contingent on some future event will not be treated as liabilities, and thus subject to variable accounting, until it becomes probable that the event will occur." (Kirkpatrick & Lockhart Nicholson Graham)

Age Discrimination and Disability Retirement: Recent Developments (PDF)
3 pages. Excerpt: "On September 19, 2005, the U.S. Sixth Circuit Court of Appeals ruled that disability retirement benefits paid to certain Kentucky state and county employees did not violate the Age Discrimination in Employment Act .... The Sixth Circuit covers Kentucky, Michigan, Ohio, and Tennessee. The case is of interest because it examines two fundamentally different perspectives on what age discrimination means with regard to retirement and disability benefits." (Gabriel, Roeder, Smith & Company)

Overview: Equity Compensation Plans under the New Deferred Compensation Rules
Excerpt: "The [article] provides an overview of the key 409A provisions, including specific requirements relating to the use of equity compensation arrangements." (Leading Companies Online Magazine via Beyster Institute)

Comments on Proposed Rule: Executive Compensation and Related Party Disclosure
Links to comments submitted since January 11, 2006. (U.S. Securities and Exchange Commission)

Overview: Getting to Know, and Love, the Short-Term Deferral Rule
Excerpt: "In its efforts to reform the rules governing deferred compensation as a part of the American Jobs Creation Act of 2004 (2004 AJCA), Congress chose to legislate broadly and to leave it to the regulators to adopt the necessary exceptions and carve-outs required to arrive at workable rules. The 2004 AJCA's legislative history envisions, and newly enacted Code §409A requires, that the regulators will fill in the particulars of the regulatory scheme." (BNA Tax Management)

Newly Posted Events
(Post Yours!)

Protecting ERISA Fiduciaries, Employers, and Administrators from Benefit Plan Risks and Liabilities: ERISA, Sarbanes Oxley, Circular 230, and Other Hobgoblins
Nationwide on June 29, 2006
presented by ALI-ABA (American Law Institute-American Bar Association)

Three HIPAA Deadlines: Portability (1/1), Privacy (4/14), and Security (4/20)-- What You Need to Do to Comply
Nationwide on February 23, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

Newly Posted Press Releases
(Post Yours!)

PBGC Assumes Pension Plan Of Furniture Retailer Rhodes Inc.
(Pension Benefit Guaranty Corporation (PBGC))

National Employee Benefits Day Is April 3
(International Foundation of Employee Benefit Plans)

Ameriprise Retirement Services Introduces Seminars, Education Tools for Roth 401(k) Plans
(Ameriprise Retirement Services)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Vice President, Training
for New York Life Investment Management LLC
in MA

Business Development Consultant
for RSM McGladrey, Inc.
in AZ

Health and Welfare Benefits Manager
for Hillenbrand Industries
in IN

Senior Account Consultant - Defined Benefit Pension Plans
for Diversified Investment Advisors, Inc.
in MA

401(k) Plan Administrator
for ERP Actuaries & Consultants
in NY

Handy Links:

Copyright 2006, Inc.; except that you may reprint this newsletter in full (including this sentence) without obtaining our permission.

Published by:, Inc.
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Winter Park FL 32789
(407) 644-4146
Fax: (407) 644-2151

Editor and Publisher: David Rhett Baker, J.D.