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April 24, 2008

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

Today's sponsor is DATAIR Employee Benefit Systems, Inc.

(Click on company name or banner to learn more.)
Banner ad for DATAIR Employee Benefit Systems, Inc.

PPA '06 Defined Benefit Software from DATAIR

DATAIR's Defined Benefit System for Valuations, Discrimination Testing, and Proposals. Includes 412(e)(3) insured plans, Cash Balance Plans, DB/DC combos and Sole Proprietors. Live, expert support.

DATAIR's PPA '06 DB System includes

  • Funding Target & Target Normal Cost (3 Rate Segments)
  • Effective Interest Rate
  • Section 430 Minimum Contributions
  • Section 404(o) Cushion Amount
  • Shortfall Amortization Bases and Amounts
  • Funding Target Attainment Percentages (FTAPS)
Contact or call 1-888-328-2474 (1-888-DATAIR-4)

[Official Guidance] Corrections to Proposed IRS Regs on Hybrid (Cash Balance) Retirement Plans Issued on 12/28/2007 (PDF)
3 pages. Excerpt: "On page 73683 . . . the language 'reasonably expected to result in a larger' is corrected to read 'reasonably expected to result in a smaller'." (Internal Revenue Service)

[Guidance Overview] DOL Opines on Offshore Custody of Pooled Plan Assets (PDF)
2 pages. Excerpt: "In Advisory Opinion 2008-04A (April 10, 2008), the Department of Labor ('DOL') considered the application of the ERISA 'indicia of ownership' rules to multinational crossborder pooling products ('MCBPP') established by a U.S. bank. Notably, DOL opined favorably on the offshore custody of foreign assets by non-U.S. branches of the U.S. bank." (Sutherland Asbill & amp; Brennan LLP)

[Guidance Overview] IRS Key Guidance on Funding Single Employer Defined Benefit Plans
Excerpt: "These latest proposed regulations set forth how minimum required contributions are to be calculated, the rules for accelerated quarterly contributions, the liquidity contribution requirements, and the application of excise taxes for failure to meet the minimum funding requirements." (Deloitte via

Introducing the Wealthy to Roth IRAs As the Income Limit on Roth IRA Participation Disappears in 2010
Excerpt: "Advisors take heed: the income limit for those who can convert their retirement holdings from a traditional IRA to a Roth IRA (now applicable to anyone with a modified adjusted gross income of $100,000) disappears permanently in 2010, so high-net-worth folks -- even Bill Gates -- will be able to get a portion of their assets into a tax-free Roth account." (Investment Advisor)

Boomers Will Face a New/Old Risk: That They May Outlive Their Money. What's an Advisor to Do?
Excerpt: "This year, the first wave of baby boomers reaches 62, the age when they are first eligible for Social Security retirement benefits. This 78 million-strong cohort will define and re-define retirement and what it means to grow old. As they do, they will raise an age-old issue with new-age ramifications: outliving one's wealth. Called longevity risk, this issue adds another facet to the already loaded definition of risk. For boomers, it's encapsulated in the question, 'Will we run out of income before we run out of steam?'" (Investment Advisor)

UK Government Considers Strengthening Pensions Regulator's Powers
Excerpt: "The government is expected to soon issue a consultation document on legal changes that would allow the Pensions Regulator (tPR) to pursue companies and individuals whose actions weaken pension schemes, even where this effect is unintentional. If adopted, the legislation would force companies to undertake more rigorous risk management." (Watson Wyatt Worldwide)

More Than 20 Major Minnesota Employers Pledge to Help Employees Improve Retirement Savings
Excerpt: "The employer-led initiative is a response to troubling trends that, unless reversed, could spell disaster for the state's economic future. Less than half of Minnesota workers participate in an employer-sponsored retirement savings plan, including more than half a million full-time workers in the Twin Cities metro area . . . ." (PRNewswire via COMTEX via FOX News Network, LLC)

Governmental Plans Roundtable, April 22, 2008
See under 'Recent News. 'Excerpt: "The following sessions were presented at the Roundtable: Navigating the Staggered Remedial Amendment Period; Requirements Relating to Section 414(d) Governmental Plans; EPCU and Examinations Efforts; Federal State and Local Governments (FSLG) -- An overview of the IRS Federal State and Local Government division, including a brief explanation of how FSLG interacts with the IRS Employee Plans. EPCRS & amp; Governmental Plans." (Internal Revenue Service)

The Pension Protection Act and 401(k)s
Excerpt: "Even though they are not in the title of the law, 401(k) plans also were significantly affected by PPA. In fact, the law opened the door for some of the most sweeping and beneficial changes in how 401(k)s operate -- both for the private-sector employers that sponsor these retirement plans and for the workers who participate in them." (The Wall Street Journal)

MetLife Offers Retirement Tips Based on Family Situation
Excerpt: "Responding to findings of its recent Family Matters study, the MetLife Mature Market Institute has made available tips on making the right choices for retirement based on family situations." (; free registration required)

CalPERS Toughens Standards on Corporate Governance
Excerpt: "The California Public Employees' Retirement System wants companies in its investment portfolio to be environmentally responsible and to have diverse boards of directors. The investment committee of the world's largest public pension fund voted to affirm those standards during Monday's meeting in Sacramento, adding them to the system's Global Principles of Accountable Corporate Governance." (The Sacramento Bee)

[Opinion] Trust Is an Essential, But Sometimes Missing, Element in Retirement Plans
Excerpt: "Employees expect clear, complete and honest communication. When they don't get it, trust weakens and commitment suffers - and so may profits. Employees who don't trust 401(k)s, 403(b)s, or their employer aren't likely to take full advantage of the plan, even with automatic enrollment. Unfortunately, the retail approach to selling is sometimes used in 401(k)s and 403(b)s." (Employee Benefit News; free registration required)

Sponsored by: ASPPA

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Banner ad for ASPPA

DOL Speaks: The 2008 Employee Benefits Conference

Do you represent plan sponsors, participants or possible both in today's retirement marketplace? If so, join colleagues and employees from the Department of Labor at this unique event designed to facilitate the open discussion of employee benefit issues facing our industry today. With its focus on current topics such as QDIA's, Investment Advice and Participant Disclosure, you do not want to miss your opportunity to be a part of this once a year collaborative event. Get additional information or 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] IRS Draft Instructions to Revised Form 990 (PDF)
9 pages. Excerpt: "Exempt organizations will use these instructions in completing their annual informational returns beginning in fiscal year 2008. Similar in form to instructions used for years past, these draft instructions provide general Form-wide instructions and specific line-by-line instructions. In addition, the draft instructions include a glossary of terms, sequencing lists (which help determine the order for filling out the Form) and compensation tables (which help determine how and where to report items of compensation)." (McDermott Will & amp; Emery)

Update on Stock Option Backdating
Excerpt: "In case you wondered how the backdating matters have been resolved, this week brings news that: The SEC settled with Broadcom Corporation for $12 million civil penalty, in addition to a permanent injunction. . . . A grand jury in Northern California indicted the former Mercury CFO for tax fraud in connection with her role in the Mercury's backdating scheme. Still no word on whether the SEC or prosecutors will act against any of the law firms that seemed to have facilitated the scandal." (Michael S. Melbinger of Winston & amp; Strawn LLP)

Newly Posted Events
(Post Yours!)

All Day Seminar with Sal Tripodi, Esq., APM
in New York on May 1, 2008
presented by ASPA Benefits Council of New York

Amending for the Final 415 Regulations
Nationwide on May 14, 2008
presented by Qualified Pension Consulting, Inc.

Amending for the Final 415 Regulations
Nationwide on May 22, 2008
presented by Qualified Pension Consulting, Inc.

Are You Ready For EGTRRA Restatements?
Nationwide on May 1, 2008
presented by

Newly Posted Press Releases
(Post Yours!)

Video: 18th Annual Retirement Confidence Survey(R): Health Care, Economy Major Concerns in Workers' Record Drop in Retirement Confidence
Principal Financial Group

RolloverSystems Enhances Support for TPAs, Advisors, Plan Sponsors

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Senior Conversion Analyst
for Administaff
in TX

Relationship Manager Associate
for Benefit Funding Services Group
in CA

for MassMutual Financial Group
in CT

Pension Account Technician
for Alerus Retirement Solutions
in MN

401k Plan Administrator
for CecilCo
in TX

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