Retirement Plans
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February 7, 2006
Today's sponsor: ASPPA • Working for America's Retirement™

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New from ASPPA Benefits Conference of the South

The Benefits Conference of the South provides an opportunity to discuss employee benefits issues with colleagues and local, regional and national government representatives from the Internal Revenue service, Department of Labor as well as private sector experts.

Register today at

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

SPARK Releases Rule 22c-2 Sample Contract Language
Excerpt: "The SPARK Institute has released sample contract language for retirement plan service providers to use in compliance with Securities and Exchange Commission (SEC) Rule 22c-2. In its press release, SPARK notes that SEC Rule 22c-2 permits mutual funds to impose redemption fees on shareholders." ( one-time registration required)

Rule 22c-2 Sample Contract Language for Retirement Plan Service Providers (PDF)
3 pages. Excerpt: "The Intermediary agrees to provide certain information to the Fund solely for the purpose of facilitating the Fund's compliance with Securities and Exchange Commission ('SEC') Rule 22c-2. TheIntermediary agrees to provide the Fund, upon written request, the taxpayer identification number (if known) of all Shareholder(s) that purchased, redeemed, transferred or exchanged Shares through an account maintained by the Intermediary ...." (The Spark Institute)

WP Abstract: Importance of Default Options for Retirement Savings Outcomes: Evidence from the U.S.
Excerpt: "This paper summarizes the empirical evidence on how defaults impact retirement savings outcomes. After outlining the salient features of the various sources of retirement income in the U.S., the paper presents the empirical evidence on how defaults impact retirement savings outcomes at all stages of the savings lifecycle, including savings plan participation, savings rates, asset allocation, and post-retirement savings distributions." (National Bureau of Economic Research; paid subscription or individual purchase required to retrieve full-text)

Talking Points: Automatic Enrollment and Automatic Acceleration Features (PDF)
2 pages. Excerpt: "The Council recommends that two modifications be made to the House approach to the safe harbor." (American Benefits Council)

Using Tobacco Cash for City Pension Deficit Proposed for San Diego
Excerpt: "The San Diego City Council yesterday endorsed Mayor Jerry Sanders' plan to pump $100 million into San Diego's troubled retirement system by borrowing that amount against a stream of tobacco settlement money." (The San Diego Union-Tribune)

ERISA's Provision Governing the Termination of a Pension Plan and Chapter 11 (PDF)
46 pages. Excerpt: "The distress termination under ERISA of a pension plan in a chapter 11 case relieves the debtor of the contractual obligations arising from the pension plan agreement and the statutory obligations imposed by ERISA but results in a claim for accrued but unpaid funding contributions." (Thomson/West via Gardner Carton & Douglas)

U.K. Pension Watchdog Could Hit Firms, Economy, Confederation of British Industry Warns
Excerpt: "The Confederation of British Industry warned on Monday that thousands of companies face a cash crisis, because the U.K. pension regulator has set harsh requirements for the financial health of their retirement plans." (Business Insurance)

Legislative Outlook -- $30 PBGC Premium Likely; Boehner New House Majority Leader
Excerpt: "[CCA Strategies reviews] two recent actions taken by the House that will affect pension policy." (CCA Strategies, LLC)

Many Employees Discover It Pays to Own the Company
Excerpt: "A growing number of small and medium-sized businesses are embracing employee ownership as a means of motivating staff members and ensuring the continuity of their companies. 'Employee ownership' refers to the concept of granting ownership of a business to all or almost all of the business' employees, through distribution of company stock." (Arizona Daily Star)

Fiduciary Responsibility: Attention to Details Can Make a Big Difference
Excerpt: "Given that an ERISA fiduciary can be held personally liable for losses that result from a breach of fiduciary duties, or the breaches of other plan fiduciaries, the New Year seems a good time for a quick review of plan governance strategies that can reduce the number of potential fiduciary defendants." ( one-time registration required)

Blog: Pensions in the Blue Book
Excerpt: "Pension provisions included in the General Explanations of the Administration's Fiscal Year 2007 Revenue Proposals (i.e., the 'Blue Book'), released [January 6, 2006] by the Treasury Department, largely reflect proposals that have been advanced by the Administration in prior years." (BeneBlog)

Commentary: Retirees Might Find Themselves Halfway to Nowhere
Excerpt: "From all appearances, it looks as though significant numbers of people are waiting for the design and building of the retirement system to be completed before they get seriously involved with it. Social Security is front and center here. Why do a lot of one's own retirement planning in mutual funds before one knows whether and how Social Security will be 'reformed'? More broadly, if our leaders can't agree on how society at large should plan for its future old people, ...." (Bloomberg News)

IRS Weighted Average Interest Rate Table Updated for February 2006
Weighted average for February 2006: 4.84% (U.S. Internal Revenue Service)

Links to Items on Executive Comp, Benefits in General

7 pages. Excerpt: "This FASB Staff Position (FSP) addresses the classification of options and similar instruments issued as employee compensation that allow for cash settlement upon the occurrence of a contingent event. The guidance in this FSP amends paragraphs 32 and A229 of FASB Statement No. 123 (revised 2004), Share-Based Payment." (Financial Accounting Standards Board)

Application of Deferred Compensation Rules under Code Section 409A to Separation Pay Arrangements (PDF)
3 pages. Excerpt: "This Client Alert focuses on the treatment of severance plans and other arrangements that provide for payments upon a separation from service under the proposed regulations issued under Code Section 409A." (Powell Goldstein LLP)

Executive Remuneration Perspective: SEC to Overhaul Executive Pay Disclosure
Excerpt: "Although the proposals are unlikely to be adopted until later this year, they are accompanied by several interpretations of the current disclosure rules (particularly the rules governing perquisites disclosure), which will likely affect the form and content of corporate disclosures in the upcoming proxy season." (Mercer Human Resource Consulting LLC and Mercer Investment Consulting, Inc.; one-time registration required)

Overview: Executive and Director Compensation Disclosure (PDF)
8 pages. Excerpt: "The proposed rules would refine the currently required executive compensation tabular disclosure and require improved narrative disclosure regarding executive compensation." (Snell & Wilmer)

Overview: DOL Releases Fiscal Year 2005 Employee Benefit Plan Enforcement Statistics
Excerpt: "The DOL uses information gathered from a variety of sources to decide which plans to subject to civil or criminal investigation. Included among these sources are the informal complaints the DOL receives and data collected from Form 5500 annual reports, including accompanying Schedules and independent accountants' opinions (auditor reports)." (Employee Benefits Institute of America Inc.)

Additional sponsor: ASPPA • Working for America's Retirement™

(Click on company name or banner to learn more.)
Banner ad for ASPPA • Working for America's Retirement™

NEW! Qualified Plan Financial Consultant

Qualified Plan Financial Consultant, QPFC, is a new professional credential for financial professionals who sell, advise, market or support qualified retirement plans.

QPFC will keep you abreast in an ever-changing marketplace while expanding your referral network.
Register for exams today!

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

Newly Posted Events
(Post Yours!)

Addressing Employee Privacy Issues and Preventing Violence in the Workplace
in California on February 28, 2006
presented by Precept Human Capital Management

Addressing Employee Privacy Issues and Preventing Violence in the Workplace
in California on March 2, 2006
presented by Precept Human Capital Management

Addressing Employee Privacy Issues and Preventing Violence in the Workplace
in California on March 7, 2006
presented by Precept Human Capital Management

Educational Workshops for Self Directed IRAs
in Florida on March 1, 2006
presented by PENSCO Trust Company

The Consumer Directed Health Care Conference
in California on May 8, 2006
presented by Transmarx, LLC

Newly Posted Press Releases
(Post Yours!)

Segal Compliance Alert: "PBGC Premiums Increased Significantly by the 2005 Deficit Reduction Act"
(The Segal Company)

Sample Contract Language Available for Compliance with SEC Rule 22c-2
(SPARK Institute)

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Employee Products Marketing Communication Manager (Pension Products)
for CUNA Mutual Group
in WI

Director, Benefits Compliance
for Gevity
in FL

Sr. Relationship Manager, Retirement Services
in CA, TX

Director of Technology
for CDM Retirement Consultants
in MD

Sr. Sales Recruiter
for ING US Financial Services
in CA

Employee Benefits/ERISA Associate
for Keating Muething & Klekamp PLL
in OH

Compensation Consultant - Non Qualified Executive Benefits
for Buck Consultants, an ACS company
in GA

Investment Education Consultant
for Fidelity Investments
in TN

OmniPlus Expert
for DC Specialists

Conversion/DeConversion Processing Specialist
for Benesystems
in AZ

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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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Fax: (407) 644-2151

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