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January 23, 2008

Here are the Web's best new links about compliance and cost aspects of plan operation, design and policy.

Today's sponsor is National Institute of Pension Administrators (NIPA)

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Banner ad for National Institute of Pension Administrators (NIPA)

Enhance Industry Knowledge at the 2008 NIPA Annual Forum & Expo!

Join fellow retirement plan professionals for three days of education and social networking at the premier industry event designed by retirement plan professionals, for retirement plan professionals.

The 2008NAFE is the ideal venue to enhance industry knowledge through 25 education sessions, exchange business best practices and peruse the expanding exhibit hall floor -- featuring the top industry vendors' cutting-edge products and solutions.

[Guidance Overview] Pomeroy Letter to Treasury on Clarification of PPA Funding Regulations (PDF)
2 pages. Excerpt: "On January 18, 2008, Rep. Earl Pomeroy (D-ND) sent a letter to Treasury Secretary Henry M. Paulson asking for clarification that a 'reasonable interpretation' of PPA is permitted until funding regulations become effective." (Earl Pomeroy via American Society of Pension Professionals & Actuaries)

[Guidance Overview] Investments That Qualify Under the Final QDIA Regulation (PDF)
5 pages. Excerpt: "This bulletin focuses on the types of investments that qualify as [Qualified Default Investment Alternatives]." (Reish Luftman Reicher & Cohen)

[Guidance Overview] Plan Cannot Limit 'Eligible Automatic Contribution Arrangements' to New Participants
Excerpt: "Such a limitation would violate the EACA uniformity requirement for an automatic contribution arrangement. In other words, all participants, old and new, are subject to the automatic deferral feature unless the participant makes an election, which could include an election to defer zero." (SunGard Corbel LLC)

[Guidance Overview] Fiduciary Breach Suit over 'Transfer Adjustment' Fee Allowed to Proceed
Excerpt: "A federal judge in Indiana is allowing a Merrillville, Indiana law firm to continue with its lawsuit against its 401(k) investment managers and recordkeeper over the amount of a 'transfer adjustment' charge levied when the firm withdrew the plan's assets." (; free registration required)

[Guidance Overview] Single-Employer Funding Rules Under PPA
Excerpt: "In this article, we review the single-employer funding rules under PPA, reflecting regulatory guidance through December 2007. This article does not cover special issues for hybrid plans . . . ." (JPMorgan)

Survey Shows Growing Interest in Automated Investment Features
Excerpt: "Popular investment products/services used by DC plans in the United States, based on the number of respondents that use them, are: Target retirement date funds, also called lifecycle investment funds (45%); Automatic rebalancing (41%); Target risk funds, also known as lifestyle funds (36%); Managed accounts (34%); Investment advice (31%)." (International Foundation of Employee Benefit Plans)

Entitlement Reform Process - Other Countries' Experiences Provide Useful Insights for the United States (PDF)
68 pages. Excerpt: "GAO was asked to identify useful insights from the entitlement reform processes in other countries. Specifically, GAO was asked to analyze (1) other countries' major efforts to reform entitlement programs, (2) the pressure(s) that led countries to undertake the reforms, (3) how reform proposals were developed, and (4) to what extent enacted reforms built in triggers requiring future actions under certain conditions; and where such trigger mechanisms did not exist, whether some adjustments nonetheless occurred." (U.S. Government Accountability Office)

New Regulations Spurring 403(b) Plan Officials to Trim Number of Service Providers Used (PDF)
Excerpt: "Executives overseeing 403(b) plans are switching to single bundled providers in anticipation of new IRS regulations set to go into effect on Jan. 1, 2009. 403(b) plans, defined contribution plans for school districts and hospitals, typically hire a slew of providers. Each offers a combination of investment, record-keeping, administration and education services." (Pensions & Investments via 403bwise)

Staff Told to Protect Thrift Savings Plan's Assets - and a Little History on the Side
Excerpt: "The federal retirement savings board's first meeting of 2008 began yesterday morning on an ominous note, with reports of a roiling stock market and an emergency interest rate cut by the Federal Reserve. . . . 'Be sure assets are safe. That systems are functioning,' Andrew M. Saul, chairman of the Federal Retirement Thrift Investment Board, told TSP senior staff." (The Washington Post; free registration required)

Shareholder Equity Decline Part of FASB Statement 158 Effects
Excerpt: "Most companies that have adopted pension accounting reform rules have seen a reduction in assets, an increase in liabilities, and a decline in shareholders' equity, a new study found. The January 2008 research by the Georgia Tech Financial Analysis Lab also found that proposed accounting changes calling for the recognition of full pension costs on a firm's income statement are likely to generate a good deal more volatility in a company's earnings." (; free registration required)

The Downside of Market-Proof Annuities
Excerpt: "The sales pitch sounds great, especially given the stock market's recent woes: Invest in stocks using a popular retirement savings vehicle and, for an extra layer of fees, you'll get protection from market declines and a guaranteed pension-like income for life. And you won't give up the ability to profit when stocks recover." (BusinessWeek)

Revenue Sharing, Pension Issues Reawaken in Alaskan State Legislature
Excerpt: "The Alaska Municipal League, a nonprofit entity comprised of more than 140 local governments, is in the capital lobbying for a long-term revenue-sharing program and a long-term solution to the unfunded liability in the state public employees' and teachers' retirement systems." (Fairbanks Daily News-Miner)

[Opinion] Mediocrity - A Superior Investment Strategy?
Excerpt: "There is no free lunch in the sense that tracking error & volatility must precede excess returns. Investment fiduciaries however face asymetric risk & rewards. There is significant fiduciary exposure for exposing a portfolio or its investors to downside risk and 'unsuitable' diversification. There is little reward for providing opportunities for upside return." (Fiduciary Investor blog)

[Opinion] Fortifying Fiduciary Practices and Oversight
Excerpt: "Fiduciaries in this country can be divided into three major groups: Investment stewards -- persons who have the legal responsibility for managing investment decisions . . . . Investment consultants -- professionals responsible for making comprehensive and continuous investment decisions . . . . Investment managers -- professionals who make investment decisions and select the individual securities to implement a specific investment mandate . . . ." (Pensions & Investments)

[Opinion] Shunning Plan Reviews - Sponsors Are Making Themselves Vulnerable to Litigation
Excerpt: "The problem with the [eligible investment advice arrangement] safe harbor is that it forces a plan to take a thorough top-to-bottom look at itself, an experience I equate to standing in your underwear in front of a full-length mirror and examining your flaws under the unforgiving glare of a battery of fluorescent lights." (Investment News; free registration required)

[Opinion] Labor Union Pension Funds - Undertaking 'to Monitor or Influence the Management of Corporations'
Excerpt: "As public companies sift through shareholder proposals in preparation for their annual meetings, a recent Labor Department action could indicate stepped-up scrutiny of one of the most activist investor groups -- labor-union pension funds." (The Wall Street Journal)

Sponsored by: ASPPA

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Banner ad for ASPPA


Join over 1,400 colleagues at the retirement industry's longest running conference dedicated solely to retirement plan sales and investment professionals , The ASPPA 401(k) SUMMIT. Attend advisor centered workshops, general sessions with internationally known speakers, secure insurance and other CE credits, network with your peers and more in Orlando, Florida, February 10-12, 2008. Don't miss your opportunity to join the best of the best.
Early bird savings apply so register NOW.

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

Links to Items on Executive Comp, Benefits in General

[Guidance Overview] SOX Section 304 Clawbacks for Backdated Options
3 pages. (Utz Miller & Kuhn, LLC)

[Guidance Overview] Issues Related to SERP Funding
Excerpt: "In this article, we're going to focus on SERP liabilities and consider whether those liabilities should be supported by specific assets, to what extent they should be supported by those assets, and what sort of strategies should be applied to allocating the assets that are supporting those liabilities." (JPMorgan)

[Guidance Overview] SEC Extends Availability of So-Called 'Expected Life Shortcut' for Use in Expensing of Share-Based Payments Under FAS 123
Excerpt: "In December, the SEC staff released Staff Accounting Bulletin No. 110 (SAB 110). For limited circumstances, this extends the availability of the shortcut used in expensing share-based payments under FAS 123." (JPMorgan)

Hunger Strike for Partner Benefits Continues
Excerpt: "Today will mark one week that Uri Horesh has gone without food in his quest to pressure the University of Texas at Austin to provide health insurance and other benefits to the partners of g.ay employees." (Inside Higher Ed)

Lilly Staffers Will Work Longer, Retirees Pay More for Benefits
Excerpt: "More than 20,000 workers of Eli Lilly and Co. will have to pay a larger share of their health-care premiums when they retire, and some might wind up working longer than expected to earn their full pensions. The Indianapolis drugmaker, under pressure to control drug prices and facing a wave of patent expirations, informed its 20,300 U.S. employees Tuesday of numerous changes in their retirement benefits." (Federated Publications, Inc.)

Towers Perrin Research Report on What's Happening in HR Service Delivery and Technology (PDF)
12 pages. Excerpt: "2007 marks Towers Perrin's 10th consecutive year conducting comprehensive research on the state of HR service delivery and technology. This survey, which mainly reaches HR business leaders throughout North America, explores trends, prevalence and future plans surrounding organizations' approaches to HR service delivery." (Towers Perrin)

Newly Posted Events
(Post Yours!)

Cafeteria Plan Election Changes: What's Permitted and What Isn't?
Nationwide on January 17, 2008
presented by Employee Benefits Institute of America (EBIA)/Thomson Tax & Accounting

EEOC Charges: How To Prepare An Airtight Response And Avoid Costly Payouts
Nationwide on February 7, 2008
presented by

Proposed Hybrid Plan Regulations: What Does It Mean for Plan Sponsors?
Nationwide on February 19, 2008
presented by ABA Joint Committee on Employee Benefits

Newly Posted Press Releases
(Post Yours!)

TIAA-CREF Introduces Lifecycle Retirement Income Fund

Survey Shows Financial Institutions See HSAs As Significant Business Opportunity
Wolters Kluwer Financial Services

Midwest Business Group on Health Awarded Grant from National Business Coalition on Health for Diabetes Quality Program
Midwest Business Group on Health

Bridges to Excellence Physician Reward Program Expands to New Jersey
Bridges to Excellence (BTE)

We're one of the top 350 employment sites on the web!Newly Posted or Renewed Job Openings
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Defined Contribution Consultant
for Callan Associates
in IL

Sales Implementation Specialist
for ePlan Services, Inc.
in CO

Client Service Supervisor
for Decimal, Inc. (aka The Online 401k)
in CA

Senior Consultant Health & Welfare
for Buck Consultants
in TX

Entry Level Retirement Plan Specialist
for McCamish Systems
in GA

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