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August 16, 2006
Today's sponsor: ASPPA • Working for America's Retirement™

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Get the Qualified Plan Financial Consultant (QPFC) Advantage

Grow your business and reach for even greater success with the higher knowledge and credibility that comes with the QPFC credential. QPFC is the professional credential for the financial professional who sells, advises, markets or supports qualified retirement plans. Distinguish yourself as a recognized retirement plan expert with the authoritative QPFC credential from ASPPA, the premier national organization for serious retirement plan professionals. For more info visit www.asppa.org/qpfc

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

Overview of Upcoming Compliance Amendments for Qualified Retirement Plans
Excerpt: "Consistent with recent practice, the IRS has announced that qualified retirement plans will need annual 'interim amendments' to reflect currently effective legal and design changes. Boards (or other entities with amendment authority) should therefore anticipate and begin to prepare for plan amendments more frequently than in the past." (Ballard Spahr Andrews & Ingersoll, LLP)

Freezing Defined Benefit Plans: The Process and Post-Freeze Issues (PDF)
11 pages. Excerpt: "The article addresses the current trend toward freezing defined benefit plans, discusses requirements for freezing such plans under ERISA and the Internal Revenue Code, and highlights issues for plan sponsors to consider once defined benefit plans have been frozen." (Groom Law Group)

Opinion: Automatic 401(k)s: A Win for Workers
Excerpt: "[T]he most important and far-reaching features of the [Pension Protection Act of 2006] are provisions that encourage the expansion of such employer-sponsored retirement accounts as 401(k)s and 403(b)s. These reforms -- long advocated by the NCPA and the Brookings Institution -- are particularly important for younger and future workers. As defined benefit plans dry up, 401(k) plans are becoming the norm." (National Center for Policy Analysis)

Overview: GASB Research Project on Accounting for Pension Benefits by Governmental Employers (PDF)
At pp. 3-4 of 6-page newsletter. (Gabriel, Roeder, Smith & Company)

Overview: Good News for Cash Balance Plans -- They Are Not Discriminatory (PDF)
3 pages. Excerpt: "Within a week's time span, there have been two developments that clarify the legality of cash balance plans. First, the Seventh Circuit Court of Appeals ruled that IBM's cash balance plan did not unlawfully discriminate against older workers. . . . Second, Congress passed the Pension Protection Act of 2006 (Act), which provides a safe harbor for hybrid plans - including cash balance plans - effective as of June 30, 2005." (Seyfarth Shaw LLP)

Overview: IBM's Cash Balance Plan Did Not Discriminate Against Older Workers
2 pages. Excerpt: "[T]he decision reverses the district court's ruling in Cooper v. The IBM Personal Pension Plan, 274 F.Supp.2d 1010 (S.D. Ill. 2003). The district court had held that IBM's cash balance plan was age discriminatory because younger participants had more years to accumulate interest credits in their cash balance plan accounts before reaching normal retirement age than older participants." (LeBoeuf, Lamb, Greene & MacRae LLP)

The PPA and Pensions and Lump Sum Distributions
Excerpt: "Most people who take lump-sum distributions from their defined-benefit pension plans will get slightly less starting in 2008, thanks to a provision in the pension bill awaiting President Bush's signature. This provision applies only to lump-sum distributions from traditional defined-benefit plans. It has no impact on 401(k) and other defined-contribution plans." (Scripps Howard News Service via Redding.com Business News)

The Advantages of Risk Pooling for Financing Retirement Benefits (PDF)
At pp. 4-6 of 6-page newsletter. (Gabriel, Roeder, Smith & Company)

Retirement Plans Help Feather Employers' Nests
Excerpt: "Small businesses, fearing cost and complexity, have skipped an employee benefit that's much in demand among the most talented workers: a retirement plan. Now, creating one is getting easier and cheaper as big financial firms and consultants compete in the small-business market and Congress clarifies rules on plan management." (USA TODAY)

Pension Protection Act Opens New Door to Advice
Excerpt: "Under the bill, only qualified 'fiduciary advisers' fully regulated by applicable banking, insurance, and securities laws may offer investment advice, and that advice must be prudent, objective, and for the exclusive purpose of providing benefits to the plan's participants and beneficiaries." (PLANSPONSOR.com; one-time registration required)

Overview: PPA Changes to Funding, Investment, Qualification & Other Employee Benefit Plan Rules (PDF)
10 pages. Excerpt: "The Pension Protection Act of 2006 (H.R. 4) . . . makes significant changes to a wide variety of rules that apply to employee benefit plans, including those dealing with minimum funding, plan investments, and tax qualification. Many provisions will require changes to plan documents and procedures, in some cases quite soon. This Client Alert summarizes some of the most significant changes made by the Act." (Pillsbury Winthrop Shaw Pittman LLP)

Retirement Income Planning, Part 11: Early Retirement Offers as a Special Case & Special Opportunity
Excerpt: "Many employees receive an early retirement offer at some point in their careers. Each time this happens, it creates a crisis for the employee, and an opportunity for the financial community. We could be doing a better job of both easing the crises and making the most of the opportunities. Employers could also do a better job of designing special offers for select employees. This paper explains the problems and points to the beginnings of a solution." (Still River Retirement Planning Software, Inc.)


Links to Items on Executive Comp, Benefits in General

2006-2007 IRS Priority Guidance Plan (PDF)
29 pages. See pp. 2-5 for information about upcoming guidance in the areas of employee benefits, executive compensation, health care and other benefits. From the IRS press release about this document: 'In Notice 2006-36, we solicited suggestions from all interested parties, including taxpayers, tax practitioners, and industry groups. . . . The 2006-2007 Priority Guidance Plan contains 264 projects to be completed over a twelve-month period, from July 2006 through June 2007." (Internal Revenue Service)

The Stock Option Backdating Scandal: Lessons for Privately-Held Companies (PDF)
4 pages. Excerpt: "The publicity surrounding backdating of stock option grants has focused on publicly traded companies. . . . However, even privately-held companies should learn from the questionable practices that have come to light and adopt procedures that avoid these concerns. In this alert, we identify some of the practices that have created problems, explain why these matter to even privately-held companies and suggest best practices to avoid issues." (Pillsbury Winthrop Shaw Pittman LLP)

Insurance As a Placeholder -- A Case for Deferred Annuities (PDF)
Excerpt: "Industry experts have suggested the possibility of using annuities as a placeholder for retirement income . . . ." (National Underwriter via Milliman)

New Website: ERISA Class Action Settlement Clearinghouse
Excerpt: "Fiduciary Counselors has created this website to provide information on what ERISA plans need to do with respect to class action settlements under ERISA or securities laws [such as settlements resulting from the mutual fund scandals and employer stock held by retirement plan trusts]. . . . The site includes information on past ERISA settlements, to help plan fiduciaries and litigators evaluate future settlements." (Fiduciary Counselors, Inc.)

Overview: SEC Focuses on Top Non-Executives in Pay Proposal
Excerpt: "The U.S. Securities and Exchange Commission proposed a revamped rule requiring companies to provide compensation details for top-paid non-executives who make 'significant policy decisions.' The proposal would, for the first time, require companies to disclose the pay of as many as three non-executive employees, in addition to the compensation of five top-managers." (Bloomberg News)

Comments: En Banc 9th Sets New Conflict Approach for Review Standard
Excerpt: "Requiring ERISA plan participants to present material, probative evidence of plan administrator conflict of interest unreasonably shifts the burden of proof, according to an en banc 9th Circuit ruling, reversing a previous 9th panel's decision and rejecting the conflict approach that had been established in the 9th's own 1995 Atwood ruling. [Abatie v. Alta Health & Life Insurance Company, 03-55601]" (Pensions & Benefits Weblog)

Employees on Military Leave: Employee Benefits Obligations of Employers
Excerpt: "An individual who performs duty on a voluntary or involuntary basis in the uniformed services is covered under USERRA. Virtually all employers regardless of the number of employees must comply with USERRA." (Poyner & Spruill LLP)

Charting the U.S. Labor Market in 2005
Excerpt: "This report . . . includes graphs and text describing the U.S. labor market in 2005. Highlights include information about educational attainment, race and Hispanic ethnicity, women, and families. . . . The chartbook is divided into sections by topic: Major Indicators, Education, Employment Relationships, Race and Hispanic Ethnicity, Women, and Families. Each chart can be downloaded individually. Note that this chartbook is presented on this website in Adobe PDF format." (U.S. Department of Labor, Bureau of Labor Statistics)


We thank and invite your attention to our additional sponsor: RELIUS® Education – Seminars and Conferences for Pension Professionals

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Banner ad for RELIUS® Education – Seminars and Conferences for Pension Professionals

Chicago Advanced Pension Conference

September 6-8, 2006 - Chicago, IL, with participating sponsor, The John Marshall Law School. This year's program has an agenda packed with sessions covering the recently passed Pension Protection Act of 2006, including the Washington Update with important 401(k) changes, New Rules for Defined Benefit Plans, Automatic Enrollments, Participant Communications Regarding Investment Decisions, and Streamlining Benefit Distribution Options, where you learn about the just-finalized 411(d)(6) regulations. Other hot sessions include Participant Loans, EPCRS, and our popular Pension Jeopardy and Ask the Experts session. Register 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!)

401(k) Plans
in Texas on November 28, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

401(k) Plans
in California on December 5, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

Cafeteria Plans
in Texas on November 29, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

Cafeteria Plans
in California on December 6, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

COBRA Compliance for Group Health Plans
in Texas on December 1, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

COBRA Compliance for Group Health Plans
in California on December 8, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

EPCRS - A New Day Dawning
in Ohio on August 22, 2006
presented by ASPPA Benefits Council of Greater Cincinnati

ERISA Compliance for Health & Welfare Plans
in Texas on November 30, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

ERISA Compliance for Health & Welfare Plans
in California on December 7, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

HIPAA Portability, Privacy & Security
in Texas on December 1, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

HIPAA Portability, Privacy & Security
in California on December 8, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

HSAs, HRAs, and Consumer-Driven Health Care
in Texas on November 30, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

HSAs, HRAs, and Consumer-Driven Health Care
in California on December 7, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)

New Electronic Payment Card Guidance for Health FSAs, HRAs, and DCAPs-- Will the New Rules Make Substantiation Easier?
Nationwide on August 1, 2006
presented by Employee Benefits Institute of America Inc. (EBIA)


Newly Posted Press Releases
(Post Yours!)

2006 - 2007 Priority Guidance Plan
(Internal Revenue Service (IRS))

Invesmart's RightPath Managed Account Option Hits 57 Percent Participation Rate
(Standard Insurance Company)


Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Vice President of Compliance
for CitiStreet
in MA

Marketing Product Manager - Relius Employee Benefits Products
for SunGard Relius
in FL

Defined Contribution Administrator
for HPL&S Inc.
in IL

Senior Account Management Specialist - # 9885
for Securian Financial Group
in MN

Client Relationship Managers
for OppenheimerFunds, Inc.
in NY

Section Manager - Marketing, Retirement Plan Svcs
for T. Rowe Price
in MD

Project Manager
for Vanguard
in PA

Annual Plan Reporting Services Manager
for Vanguard
in PA

401(k) Plan Administrator
for The Osborne Organization, Inc.
in CA

VP Retirement Paycheck Service
for Merrill Lynch
in NJ

Counsel (Employee Benefits/Tax/Retirement Accounts)
for Great-West Corporate
in CO




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