Retirement Plans
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July 27, 2006
Today's sponsor: Employee Benefits Institute of America Inc. (EBIA)

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401(k) Plans Manual

Our 401(k) Plans manual is a must-have resource for employers with 401(k) plans and for administrators and advisors. Topics include eligibility, vesting, contributions, distributions, plan loans, hardship withdrawals, discrimination testing, fiduciary duties, plan investments, plan corrections, and much more. Sample documents and official guidance included.

"The 401(k) manual's absolutely wonderful. I would highly suggest you take a look."

For information on EBIA's seminars, please go to

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

Lawmakers at Odds on Pension Investment Advice
Excerpt: "U.S. lawmakers Wednesday faced one of the last sticking points in a mammoth bill to shore up pensions -- whether to make it easier for financial firms to give workers advice on their retirement accounts." (Reuters Limited via Business Insurance)

IRS's New Resource for Rollovers from Qualified Retirement Plans Includes Chart (PDF)
1 page. Excerpt: "A Rollover Chart summarizing the rollover rules is provided as a general guide but should not be relied upon as a substitute for professional tax advice." (Internal Revenue Service)

DOL FAQs Relating to Waivers of the 60-Day Rollover Requirement
Excerpt: "[The first seven FAQs are:] 1. Are there any automatic waivers of the 60-day rollover period? 2. How do I obtain a waiver of the 60-day rollover requirement? 3. How does IRS (Service) determine whether to grant a waiver? 4. Which taxpayers are eligible to request extensions of the 60-day rollover period? 5. What information is required to be submitted to obtain a waiver? 6. How does the Service process requests for extension? 7. Is a request for extension subject to disclosure?" (Internal Revenue Service)

Picking a Provider for a Small Company
Excerpt: "Putting together a committee comprised of employees savvy enough to hold up to an ERISA court's standards is not an easy task for a small company, where there are only a few top level managers that would pass muster . . . ." (; one-time registration required)

Evaluating and Choosing Retirement Plan Service Providers
Excerpt: "When shopping for service providers, plan sponsors and their advisors cannot be shy when it comes to the specific services for which they are looking." (; one-time registration required)

Maine's Senator Snow Pushes DB(k) Plan to Aid Small Business Owners
Excerpt: "Senate Bill 3715 would create a hybrid defined benefit and 401(k) plan that Snowe, a Republican, claims would make it easier for small employers to offer pensions to their employees with lower retirement savings." (Plan Sponsor magazine via Reish Luftman Reicher & Cohen)

Podcast Transcript: Longer Lives & the 'Lump-Sum Illusion' Are Challenges Retiring Baby-Boomers Face
Excerpt: [T]he rising tide of boomers in the U.S. . . . needs to meet challenges that previous generations never faced, including changes to key retirement institutions, . . . medical-care cost inflation and the 'lump-sum illusion' -- the tendency to view retirement savings as a lump sum, as opposed to a prospective income stream. Knowledge@Wharton spoke with [Olivia] Mitchell and [Christopher] Condron about how the financial services industry is working to meet the needs of [boomers]." (Wharton School of the University of Pennsylvania)

American Benefits Council Testimony Before the IRS on Roth 401(k)/403(b) Accounts (PDF)
5 pages. Excerpt: "[The testimony focused] on particular issues in the following areas: (1) separate account issues (particularly with respect to automatic rollovers), (2) hardship distributions, (3) loans, (4) the five-year holding period, and (5) reporting requirements." (American Benefits Council)

Comments on Pension Accounting Going Global
Excerpt: "Global Pensions Magazine reports that the International Accounting Standards Board (IASB) has added pension accounting to its work plan. Smoothing and cash balance plans are two of the topics to make their way under the microscope." (Pension Risk Matters; posted by Susan Mangiero)

Chart: Excess Contribution Corrected within 2-1/2 Months & Excess Aggregate Contribution, July 7, 2006
Excerpt: "Instead of a corrective distribution, a QNEC may be made at any time up until 12 months after the close of the plan year being tested. A timely made QNEC will avoid the 10% employer penalty. However, because of the 12-month rule, QNEC contributions may not be made for plans using the prior year testing method." (McKay Hochman Co., Inc.)

Discussion Panel on Top Fiduciary Concerns of Retirement Plan Sponsors
Excerpt: "Mark Niziak, a lawyer, and managing director of New York Life Investment Management, told those attending a discussion panel session on plan fiduciary issues at PLANSPONSOR's Plan Designs 2006 conference that sponsors owed participants the same responsibility of care with company stock as any other investment alternative." (; one-time registration required)

Belgium Employers Have Until End of Year to Amend Retirement Plans
Excerpt: "Most of the new requirements for employer-sponsored plans, set out in the 2004 WAP/LPC law . . . , have been in force since January 1, 2004. However, employers were given three years to amend their plan rules to comply with the legislation, and the time limit runs out at the end of this year." (Towers Perrin)

Overview: Draft EU Portability Directive
Excerpt: "The DWP has confirmed, among other things, that UK occupational pension schemes will not be forced to accept transfers and that the existing UK revaluation requirements will not be affected by the proposed EU Directive." (Watson Wyatt Worldwide)

British Pensions Regulator: Funding, Investment, Governance Key Disclosures in Trustees' Report & Accounts
Excerpt: "The Pensions Regulator has published a discussion document, Review of the form and content of pension scheme report and accounts. In the document, the Regulator considers how trustees can provide 'less, but more meaningful' information to members in their annual report and accounts. In doing so, it focuses on three specific areas-- funding, investment and governance-- and considers how the recent legislative changes can be reflected in the information provided to members." (Watson Wyatt Worldwide)

Overview: UK Government Proposes New National Pension Savings Plan
Excerpt: "The new national plan, which is intended to start in 2012 and is designed especially for those employees without access to a good employer-sponsored plan, contains these key elements: Employers will contribute a minimum of 3% on earnings subject to social security contributions . . . . Employees will contribute a minimum of 4% of that slice of earnings, with an additional 1% coming from the government." (Towers Perrin)

Links to Items on Executive Comp, Benefits in General

Overview: The SEC Rules Relating to Disclosure of Executive and Director Compensation (PDF)
4 pages. Excerpt: "At its open meeting [on July 26, 2006, the Securities and Exchange Commission adopted in part and re-proposed in part the rules on executive and director compensation and related party transactions, as originally proposed on January 27, 2006." (Alston & Bird LLP)

SEC Adopts Revised Milken Rule Requiring Disclosure of Compensation of Top Executives
Excerpt: "The rule adopted [July 26] will require additional disclosures of the pay of such people, most importantly providing better information about retirement benefits. And, if the Milken rule is adopted after the new comment period, the disclosures may cover some subsidiary bosses, even if they have no authority over the parent company." (The New York Times; one-time registration required)

SEC Approves Updated Executive Compensation Disclosure Rules
Excerpt: "Under the new rules . . . companies must provide details on: executive salary, bonuses, the dollar value of stock and stock option awards, annual changes in the value of pension benefits, any 'above-market' earnings on deferred compensation, and all other compensation, including perks exceeding $10,000 a year. The items must be shown separately and as a single, bottom-line total, the WSJ reports." (; one-time registration required)

Summary: FASB Discussion on Pension/OPEB Measurement Date, More, on July 26, 2006
Excerpt: "FASB voted to retain the requirement that companies align their measurement date with their balance sheet date, as set forth in its March 31, 2006 Exposure Draft (ED), Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans." (Financial Executives International)

Blog: Measurement Date Change for Pension Plans and Other Postemployment Benefits Pushed Back
Excerpt: "[The] decision not only defers the measurement date change, but eliminates the need for an extra measurement date for measurement of cost. The issue of the cost measurement has been the source of some confusion, even among the FASB itself. Yesterday's discussion clarified that use of an early measurement date for cost merely shifts the cost measurement, rather than the cost itself." (Pensions & Benefits Weblog)

Impact of Planned Accting Changes for Pensions & Other Postretirement Benefits-- Updated July 2006 (PDF)
4 pages. Excerpt: "This paper updates [the Towers Perrin] January 2006 analysis of the potential impact of the expected accounting changes [to employers' accounting for pensions and other postretirement benefits (e.g., retiree medical benefits)] to reflect more recent corporate financial results and the latest developments in the FASB project." (Towers Perrin)

GRS Insight, July 2006, Covers Health Care Cost Mgmt & Accounting & Financing of Retirement Benefits (PDF)
6 pages. The articles in this edition are titled: Managing Health Care Costs: A Case Study; The GASB's New Research Project on Accounting for Retirement Benefits; and, The Advantages of Risk Pooling for Financing Retirement Benefits. (Gabriel Roeder Smith & Company)

Corrected Link: Participant Did Not Revoke Written Beneficiary Designation By Visiting Plan Website
Excerpt: "EBIA Comment: This case serves as a useful reminder to plan sponsors using electronic administration to ensure that plan websites (and other electronic features) are consistent with plan documents and SPDs. This plan's website allegedly stated that beneficiary designations 'previously made on paper will no longer be valid,' . . . ." (Employee Benefits Institute of America (EBIA))

Thoughts about Executive Compensation
Excerpt: "[The target page presents questions] regarding the new SEC executive compensation disclosure requirements." (Pension Risk Matters; posted by Susan Mangiero)

Labor Benefits Panels Prepare Agendas
Excerpt: "The Advisory Council on Employee Welfare and Pension Benefit Plans and its working groups are deciding what to discuss at their mid-August meetings. [Links to the meeting notices are on the target page.]" (National Underwriter Life & Health; free one-time registration or paid subscription required)

By 2009, Companies Offering Pension, 401(k), and Health-Benefit Plans Must Be Technology Savvy
Excerpt: "A new Department of Labor regulation requires companies to file their benefits annual reports electronically, starting in 2009. The new rule . . . affects annu[a]l reports dated January 1, 2008, or after. The protracted start will give plan and service providers, 'time to adapt to the new electronic system,' noted a DoL statement." (

Employers in Republic of Korea React Cautiously to New Severance Benefit Law
Excerpt: "Employers are moving cautiously in response to a change in South Korean law that encourages them to fund their severance benefit plans in full, according to a Towers Perrin survey of companies doing business in the country." (Towers Perrin)

We thank and invite your attention to our additional sponsor: The Center for Tax Law and Employee Benefits at The John Marshall Law School

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Banner ad for The Center for Tax Law and Employee Benefits at The John Marshall Law School

You Have the Potential. We Have the Programs.

Are you working in human resources? Are you dealing with health insurance plans or pension benefits? Learn how you can broaden your experience with an M.S. degree (for non-lawyers) or LL.M. degree (for attorneys) in employee benefits from The John Marshall Law School in Chicago during an information session from 5 to 7 p.m., Wednesday, August 2. Learn how these unique programs can help advance your career.

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

Newly Posted Events
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Nationwide on September 28, 2006
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Newly Posted Press Releases
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Council Testifies Before IRS on Roth 401(k)/403(b) Issues
(American Benefits Council)

Newly Posted or Renewed Job Openings
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401(k) Plan Account Manager
for D/A Financial Group of California
in CA

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for Sempra Energy
in CA

DC Requirements Consultant
for Hewitt Associates
in IL

Benefits Operations Manager
for Hewitt Associates
in CT

Account Supervisor, Employee Benefits
for D/A Financial Group of California
in CA

Defined Contribution Administrator
for IPA Northeast, LLC
in NJ

Employee Benefits Administration
for Primary Consulting, Inc.

401(k) Account Manager
for Malcolm Thompson and Associates, Inc.
in TX

ARS Marketing Communications Specialist
for Administaff
in TX

Defined Benefits Coordinator/Analyst
for Constantin Control Associates
in NJ

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