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March 4, 2008

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

Today's sponsor is ASC & The ASC Institute

(Click on company name or banner to learn more.)
Banner ad for ASC & The ASC Institute

Let ASCi be your 403(b) tax-sheltered annuity plan document solution!

The IRS now requires that every employer with a 403(b) tax-sheltered annuity plan must have a written plan document in place by December 31, 2008. Whether you maintain thousands or just a few 403(b) plans, the ASCi Document Generation and Management (DGEM) system can help you manage these plans efficiently and easily.
Click here to learn more about how DGEM can help you meet the IRS requirements.

[Guidance Overview] 403(b) Final Regulations -- Transfers and Exchanges
Excerpt: "The new 403(b) regulations concerning plan transfers and contract exchanges both expand permissible transactions for participants and place controls on conditions of the transactions to ensure compliance with limitations and distribution restrictions. Participants are no longer on their own to decide if they can make a transfer or exchange. These provisions of the new regulations were generally effective September 24, 2007." (; free registration required)

[Guidance Overview] Participant Contributions Are 'Plan Assets' After 7 Business Days
Excerpt: "On February 29, 2008, the DOL issued a proposed amendment to DOL Regulation §2510.3-102 which establishes 'a safe harbor period of 7 business days (effectively 9 days)' regarding the deadline for plan deposits of employee 401(k) elective deferrals and loan repayments for plans sponsored by small employers only (plans with 100 or fewer participants)." (ERISA Expertise LLC)

[Guidance Overview] DOL's Proposed 7-Day Safe Harbor for Employee Contributions May Affect FAB 2008-01
Excerpt: "In December of 2007, the Dept. of Labor released Field Assistance Bulletin 2008-01 addressing the trustee's responsibility for the collection of delinquent employer and employee contributions. Part of the regulatory authority relied on by FAB 2008-01 was affected last Friday when the DOL released the new proposed safe harbor for employee contributions. This new proposed rule affects Labor Reg. 2510.3-102(a) by adding subsection (a)(2), which contains a 7-day safe harbor period for contributions, and which adds loan repayments alongside the contribution requirements in Labor Reg. 2510.3-102(a)(1)." (Pension Protection Act Blog)

February 2008 Edition of the Pan-European Pensions Update
In this Issue: What is the European Pensions Group? Developments in European pensions law, and, Implementation of the IORPs Directive in various European jurisdictions. (Baker & McKenzie)

Participant Perceptions and Decision-Making Concerning Retirement Benefits (PDF)
22 pages. Excerpt: "This study reports the results of a new survey of Nebraska state workers who retired or terminated employment in 1997. The results offer a perspective on how individuals perceive their decisions 10 years later. The findings reveal three general themes. First, retirees tended to underestimate the financial risks associated with uninsured health care expenses. . . . Second, federal policies may influence the distribution decision. . . . Finally, the results provide a basis for cautious optimism that retirees will be able to successfully manage a present value sum distribution during retirement." (Center for Retirement Research at Boston College)

CRS Report to Congress: Social Security Reform - 'Transition Costs' (PDF)
6 pages. Excerpt: "Some policy analysts have suggested that pre-funding Social Security benefits through individual accounts (IAs) could improve the solvency of the current system, thus reducing or eliminating the need for higher taxes, lower benefits, or increased borrowing. However, there is general agreement among economists that any transition to a pre-funded system results in additional costs, so-called 'transition costs,' in the short-run." (U.S. Congressional Research Service)

Bill Would Help Retirement Savings Plans at Small Businesses
Excerpt: "Called the SAVE Act of 2008, HR 5160 would boost incentives for small businesses to start Simple individual retirement accounts and 401(k) plans, provide more rollover flexibility and reduce associated administrative burdens." (Investment News; free registration required)

California Assembly Member Introduces New Legislation for 2008 Covering Retirement and Health Care
Excerpt: " This bill is one of two that Hernandez has co-authored with Senator Patricia Wiggins to implement all recommendations requiring legislative action from the Public Employee Post-Employment Benefits Commission formed by the Governor in December of 2006." (California Chronicle)

Notes on Buffett's Annual Report to Shareholders
Excerpt: "Natural disasters aren't the only worry on Buffett's mind. He is also concerned about the bill that will come due when U.S. companies are forced to tell shareholders they have been pumping up their earnings by under funding their pension plans. Most big companies have been vastly overestimating the kind of returns their pension plans can realistically expect to earn, Buffett writes." (

Cost of 401(k) Match Has Many Bosses Steering Clear of Auto Enrollment
Excerpt: "Hewitt Associates polled 190 companies at the end of 2007 and found that the cost of making matching contributions was the number one 'barrier to entry' for more than half the companies that don't plan to adopt automatic enrollment anytime soon." (Financial Week; free registration required)

[Opinion] Grabek v. Northrup Grumman Corp. - Brief for Secretary of Labor As Amicus Curiae Supporting Plaintiff-Appellants (PDF)
17 pages. This provides a link to the correct brief. (U.S. Department of Labor)

[Opinion] The Market Value of Pension Liabilities (PDF)
4 pages. Excerpt: "What is the market value of pension liabilities covered under FAS 158? This is a difficult question, because the Financial Accounting Standards Board (FASB) is currently between working definitions of market value as it applies to pension liabilities." (Daniel P. Moore via Contingencies)

Sponsored by: ASPPA

(Click on company name or banner to learn more.)
Banner ad for ASPPA

The ERISA Outline Book

Stay current with The ERISA Outline Book, 2008 Edition, by Sal Tripodi, J.D., LL.M. only from ASPPA. Available in both print or on CD, this one of a kind resource has become the must have for anyone working in the pension industry today. Fully updated with the latest guidance on a variety of PPA 2006 items, the 2008 Edition also includes automatic enrollment guidance including QACAs, final regulations on QDIA's, guidance on benefit restrictions and much more. Stay current and order your copy today.

(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

[Official Guidance] Text of Proposed Labor Regs: 7-Day Safe Harbor for Participant Contributions for Plans Having Fewer Than 100 Participants (PDF)
Excerpt: "[T]he Department believes that adoption of a '7-business day' safe harbor rule would present little, if any, additional risk to plan participants and beneficiaries. In this regard, the Department believes that most employers with small plans that are taking longer than 7 business days to deposit participant contributions will expedite the depositing of those contributions to take advantage of the safe harbor. The Department also believes that where participant contributions are being made by employers with small plans within a period shorter than 7 business days, few employers with small plans will incur the costs attendant to modifying their payroll system in order to hold such contributions for a few additional days." (Employee Benefits Security Administration, U.S. Department of Labor)

[Guidance Overview] Insurance Policy 'Discretionary Clauses' After Rush Prudential - An Endangered Species?
Excerpt: "Not only is there no ERISA provision directly providing a lenient standard for judicial review of benefit denials, but there is no requirement necessarily entailing such an effect even indirectly. When this Court dealt with the review standards on which the statute was silent, we held that a general or default rule of de novo review could be replaced by deferential review if the ERISA plan itself provided that the plan's benefit determinations were matters of high or unfettered discretion . . . ." (Health Plan Law blog by Attorney Roy F. Harmon III)

[Guidance Overview] FASB to Propose Disclosure of More Asset Categories and Asset Valuation Assumptions
Excerpt: "The Financial Accounting Standards Board (FASB) has instructed its staff to issue an FASB Staff Position (FSP) paper by March 7, 2008, that proposes to improve disclosures about postretirement benefit plan assets now required by Financial Accounting Statement (FAS ) No. 132(R), Employers' Disclosures about Pensions and Other Postretirement Benefits." (Wolters Kluwer Financial Services)

[Guidance Overview] IRS Provides Transition Relief for 'Tainted' Performance-Based Compensation (PDF)
2 pages. Excerpt: "Now that the IRS has issued Revenue Ruling 2008-13, companies have additional time to review employment agreements, plans, and contracts to identify payment terms similar to the terms described in the ruling and to determine potential 'fixes' for future performance-based compensation. Although the transition relief is helpful, companies need to review and monitor the expiration and renewal provisions of employment agreements to determine the applicable transition period." (Holme Roberts & Owen LLP)

[Guidance Overview] Section 162(m) - IRS Confirms Previous Private Letter Ruling; Ruling Will Be Effective on a Going-Forward Basis
Excerpt: "Companies should review plans and arrangements that are intended to qualify as performance-based compensation under Section 162(m) to determine if the plans or arrangements provide that compensation will be paid without regard to whether the performance goal is attained if an individual is involuntarily terminated, terminates his or her employment for good reason, or retires." (Wilson Sonsini Goodrich & Rosati)

[Guidance Overview] IRS Delays Application of Its Holding Under Recent Section 162(m) Executive Performance Pay Ruling (PDF)
1 page. Excerpt: "Publicly traded corporations should consider the following actions during the transition period: Review any agreement providing performance-based compensation covered by Code section 162(m) (or acceleration of such compensation) to determine if it would permit payment upon the impermissible employment terminations (i.e., terminations other than death, disability and change in control) regardless of the level of performance attained; If any agreement subject to Code section 162(m) contains such language, consider amending it, as necessary, so that the performance-based compensation will be paid only if actual performance is achieved or upon death, disability or change in control; and Consider the implications for the company's proxy disclosures related to performance-based compensation." (Haynes and Boone, LLP)

2007 Conference Highlights: National Coordinating Committee for Multiemployer Plans
Excerpt: "Click on the links . . . to view the videos of our 2007 Annual Conference in Flash Player format. If you do not have the free Flash Player you can download it by clicking on the red Adobe Flash logo located in the box [on the target page]." (National Coordinating Committee for Multiemployer Plans)

Newly Posted Events
(Post Yours!)

EGTRRA Pre-approved Plan Workshop
in Oregon on April 10, 2008
presented by SunGard Relius

Newly Posted Press Releases
(Post Yours!)

U.S. Labor Department Extends Annual Reports Deadline After Severe Weather Hits Kentucky
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Parents Who Web Commute Balance Work and Family with Citrix GoToMyPC and GoToMeeting
Citrix Systems, Inc.

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Plan Document Specialist
for Kravitz - Louis Kravitz & Associates

Pension Administration
for Stephen H. Rosen & Associates, Inc.
in NJ

Retirement Consultant
for The Bostonian Group
in MA

Pension Administrator
for PRB Administrators Incorporated
in NY

Implementation Specialist
for Great-West Corporate
in CO

Administrator for Retirement Plan and ERISA Specialists
for Dana Consulting Group, Ltd.
in IL

Director, Retirement Programs
for CBS Corporation
in NY

Manager, Retirement Programs
for CBS Corporation
in NY

Senior Benefits Specialist
for Crown Equipment Corporation
in OH

Benefits Communications Manager
for Ralcorp Holdings
in MO

Relationship Manager
for Vanguard
in AZ

Home Based Participant Services Representative
for Citi
in MI

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