Retirement Plans
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December 8, 2006

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EBIA's 401(k) Plans Manuals and Seminars!

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PBGC Reportable Events: Traps for the Unwary (PDF)
9 pages. Excerpt: "This article provides a brief overview of the PBGC's reportable events rules and identifies some traps for the unwary. The focus will be primarily on post-event reporting, since advance reporting applies only to a very small group of privately-held controlled groups with significantly underfunded plans." (Journal of Pension Planning & Compliance via Keightley & Ashner LLP)

So You've Become a Fiduciary: Signposts, Suggestions, and Sympathy
Originally published Autumn 2005. Excerpt: "This column provides an overview of ERISA's fiduciary requirements in order to assist individuals that work with ERISA plans to avoid pitfalls and liabilities with respect to plan administration. The column does not discuss in detail the fiduciary requirements that would apply to a person or entity responsible for investing plan assets." (Steptoe & Johnson LLP)

Overview: Transitional Relief from Investment Diversification/Participant Notification Requirements (PDF)
3 pages. Excerpt: "The IRS has requested comments on these new employer security diversification rules, including the model notice. Final regulations, when issued, are expected to be consistent with these transitional rules." (Prudential Retirement)

Discussion Paper: The Retirement Project: Why Do Boomers Plan to Work So Long? (PDF)
37 pages. Excerpt: "The recent uptick in average retirement ages appears to be the leading edge of a new long-term trend. Lengthier careers will likely promote economic growth, increase government revenue, and improve individual financial security at older ages." (Urban Institute)

Will There Be a Re-Evaluation of Retirement Issues in the Legal Community?
Excerpt: "Unlike corporate America, which, for the most part, dropped mandatory retirement ages decades ago, many big law firm partnerships are keeping up the practice of pushing out older lawyers to make room for new blood." (The New York Times; free registration required)

Overview: IRS Extends Election Period for Airline Plans to Make Alternative Deficit Reduction Contributions
Excerpt: "The IRS has provided an extension of the election period for alternative deficit reduction contributions for certain employers in the airline industry to comply with changes made by Section 402(i) of the Pension Protection Act of 2006 (PPA; P.L. 109-280)." (Wolters Kluwer Law & Business)

Working Paper: The Impact of Aggregate Mortality Rise on Defined Benefit Pension Plans
Excerpt: "We calculate the risk faced by defined benefit plan providers arising from uncertain aggregate mortality -- the risk that the average participant will live longer than expected. First, comparing the widely cited Lee-Carter model to industry benchmarks, we show that plan providers appear to substantially underestimate the longevity of their employees." (Center for Retirement Research at Boston College)

Working Paper: Optimal Retirement Asset Decumulation Strategies -- The Impact of Housing Wealth
Excerpt: "A considerable literature examines the optimal decumulation of financial wealth in retirement. We extend this line of research to incorporate housing, which comprises the majority of most households' non-pension wealth." (Center for Retirement Research at Boston College)

Wisconsin Lawmakers' Retirement Money
Excerpt: "We've told you about the debate at the state capitol, over sick leave for lawmakers, and its use to pad retirement. But 27 News has found lawmakers already have competitive retirement benefits. Which cost them nothing." (WKOW Television, Inc.)

Social Security Change in China Leaves Employers in a Quandary
Excerpt: "The Ministry of Labor and Social Security's decision to stop managing supplementary retirement programs as of the end of 2007 is raising questions for many companies and prompting some to consider setting up enterprise annuity arrangements. A recent Watson Wyatt Worldwide survey of multinational companies showed that many are still studying their options and awaiting more clarity on regulations and taxation that might apply to enterprise annuities." (Watson Wyatt Worldwide)

Mexican Pension System Becomes More Transparent
Excerpt: "In an effort to strengthen the defined contribution retirement system and continue improving its transparency, Mexican pension funds administrators (or Afores) have agreed to make public, on a semi-annual basis, the composition of their investment portfolios and the respective benchmark indices they used to measure their performance." (Watson Wyatt Worldwide)

Overview: EGTRRA Changes Made Permanent
Excerpt: "Certain provisions of the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) were scheduled to expire or 'sunset' on December 31, 2010. Defined contribution plans should note that the Pension Protection Act ('PPA') extended many provisions of EGTRRA . . . ." (Hanson, Bridgett, Marcus, Vlahos & Rudy, LLP)

Opinion: The Defined Benefit Plan System: What Does the Future Hold?
Excerpt: "[T]he private defined benefit plan system has been withering away without any great public debate. Whether for reasons of cost, competition, volatility or other business reason, employers have been steadily and increasingly choosing to move away from defined benefit plans." (Pension & Benefits Blog)

Links to Items on Executive Comp, Benefits in General

Proposed FASB Staff Position, No. FAS 158-a, Conforming Amendments in FASB Statements (PDF)
256 pages. Excerpt: "This proposed FASB Staff Position (FSP) would make conforming amendments to the illustrations contained in the following appendixes to reflect the provisions of FASB Statement No. 158, Employers' Accounting for Defined Benefit Pension and Other Postretirement Plans: Appendix B of FASB Statements No. 87, Employers' Accounting for Pensions, Appendix B of FASB Statement No. 88, Employers' Accounting for Settlements and . . . ." (Financial Accounting Standards Board)

Overview: IRS Final Regulations on the Use of Electronic Media
Excerpt: "In October 2006, the IRS issued final regulations regarding the use of electronic media for providing employee benefit notices and making employee benefit elections and consents. The final regulations reflect the applicable provisions of the Electronic Signatures in Global and National Commerce Act (E-SIGN) as it relates to the electronic delivery of notices." (ERISAdiagnostics, Inc.)

IRS Audits of Executive Compensation Suggests Need to Review Pay Practices and Procedures
Originally published Autumn 2004. Excerpt: "Although clearly companies and executives who fail to follow the rules should deal with the adverse consequences of that failure, it is unfortunate that the Service had to resort to the audit technique of enforcement, particularly in light of the dearth of regulatory guidance and lack of clear rules, and particularly in cases where the Service has known about various practices but failed to act in the past." (Steptoe & Johnson LLP)

Deferred Comp Legislation Calls for Review of Severance, Employment, and Compensation Arrangements
Originally published Summer 2005. Excerpt: "Employers need to recognize that most arrangements providing deferred compensation are covered by the new law. These include severance plans and agreements, employment agreements, certain insurance arrangements, and plans that 'wrap' around qualified 401(k) and 403(b) arrangements to provide benefits in excess of qualified plan limits." (Steptoe & Johnson LLP)

Appellate Court Rules Options Taxable When Exercised
Excerpt: "In the first time it has considered the issue, a federal appeals court has ruled that an employee's nonqualified stock options from his employer became taxable when the options were exercised." (; free registration required)

Newly Posted Press Releases
(Post Yours!)

Value of Employee Stock Option Grants Declines Sharply, Watson Wyatt Finds
Watson Wyatt

IRS Headquarters Reopens; First Employees Return Today
Internal Revenue Service (IRS)

Procedure for Making Certain Submissions to the IRS Returns to Normal
Internal Revenue Service (IRS)

DMAA, NCQA Collaborate on Disease Management Clinical Measures
National Committee for Quality Assurance (NCQA)

Health Care Subsidies to Exceed $200 Billion
Agency for Healthcare Research and Quality

Newly Posted or Renewed Job Openings
Post a Help Wanted Ad

Defined Contribution Retirement Plan Administrator
for Loren D. Stark Company, Inc.
in TX

Compliance Specialist
for Healthcare Management Administrators, Inc. (HMA)
in WA

Director, New Business Development for Health Savings Account Group
for Buck Consultants
in NJ

Retirement Tax Specialist
for Edward Jones
in MO

Senior Technical Education Consultant

Pension Administrator
for Chambers Benefit Group, APC
in NM

Pension Analyst/Senior
for Segal Company
in NY

EAS Executive Trading Plans Manager
for Merrill Lynch
in NJ

Retirement Plans Client Service Representative- Consultation
for Union Central Life Insurance Company
in OH

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