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September 12, 2008

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

Today's sponsor is International Foundation of Employee Benefit Plans

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Banner ad for International Foundation of Employee Benefit Plans

E-learning Benefit Courses From the International Foundation

You donít need a navy suit to get ahead at your job. Put on those fuzzy slippers, grab your computer mouse and learn with the International Foundation. The International Foundationís e-learning courses provide the highest quality education covering all employee benefit topics, from the basics to compliance technicalities. Prove you know your stuff and get to the next level with the International Foundationís e-learning courses. And bring your pink bunny slippers along for the ride.

Your Opinions Are Desired on International and Cross-Border Retirement and Fringe Benefit Plans; IRS Advisory Committee Survey Seeks Opinions of Employers, Administrators, Practitioners, Consultants
2-page Word survey questionnaire; September 30 deadline. Excerpt: "The IRS Advisory Committee on Tax Exempt and Government Entities (TE/GE) (the 'ACT') is undertaking a study to identify international and cross-border activities, issues, challenges, impediments and barriers in connection with the design, coverage, portability, and tax administration of US employee retirement (qualified and non-qualified) and fringe benefit plans. . . [T]he ACT is particularly interested in the views of stakeholders, such as employers, administrators, trustees, custodians, practitioners and consultants regarding these issues [and asks for your views on or before September 30, 2008]." (IRS Advisory Committee on Tax Exempt and Government Entities)

[Guidance Overview] No Breach of Contract Without a Breach of a Written Benefit Plan, According to Eighth Circuit
Excerpt: "A group of retirees could not pursue their claims for breach of contract relating to a company's early retirement incentive program because ERISA requires a breach of a written contract term. This was the ruling of the Eighth Circuit U.S. Court of Appeals in Cole, et al. v. International Union, United Automobile, Aerospace & Agricultural Implement Workers of America, et al." (Wolters Kluwer)

[Guidance Overview] Are Your Retirement Accounts Safe at Your Bank?
Excerpt: "With more banks expected to fail, it's a good time to look into the protections available for your retirement accounts" (BusinessWeek)

[Guidance Overview] IRS Provides 2007 Form 5500 Series Filing Tips, Useful for Plan Sponsors on Extension of Time to File
Excerpt: "The IRS has provided some 2007 Form 5500 series filing tips for small and one-participant pension plans and welfare plans that are non-calendar year plans or have filed for an extension. The filing deadline for 2007 calendar year plans was July 31, 2008." (Wolters Kluwer)

[Guidance Overview] Options for Transitioning to PPA Lump Sums
Excerpt: "The Pension Protection Act of 2006 (PPA) changed the minimum basis for calculating lump sums. IRS Notice 2008-30, issued in March 2008, provides helpful guidance for transitioning from 'old law lump sums' to 'PPA lump sums.' In this article, we explore the paths a plan sponsor may take as they transition to the new 'PPA lump sums.'" (JPMorgan)

[Guidance Overview] Department of Labor Proposes Guidance on Participant Advice
Excerpt: "The Department of Labor recently released a proposed regulation implementing the statutory exemption under the Pension Protection Act (PPA) for the provision of investment advice to participants in participant-directed individual account plans (such as 401(k) plans). Additionally they've released a proposed class exemption, expanding the statutory exemption in two respects. In this article we review the proposed regulation and (briefly and in passing) the class exemption, focusing on the key issues for plan sponsors." (JPMorgan)

Testimony to EBSA Advisory Council on Spend-Down of DC Assets at Retirement (PDF)
7 pages. Excerpt: "[W]e propose that a substantial portion of each participant's account balance in 401(k) and other similar plans be automatically directed (defaulted) into a two-year trial income product when retirees take distributions, unless they affirmatively choose not to participate. The automatic trial income arrangement would make 24 consecutive monthly payments to an individual on a voluntary basis, i.e., if the individual did not opt out. At the end of the trial period, retirees could elect an alternative distribution option, but if they did nothing, they then would be defaulted into a permanent income payment program. Employers and plan sponsors would be encouraged to offer the trial income plan and would have discretion over some of its structure and implementation." (Mark Iwry for the Retirement Security Project)

Coordinating Defined Benefit and Defined Contribution Benefits in a Multi-Pillar Pension Plan
Excerpt: "Current multi-pillar pension plans have adopted the same retirement age for the defined benefit (DB) and defined contribution (DC) components of the plan. This paper considers potential benefits obtainable from coordinating DB and DC benefits. The plan proposed here involves establishing an earlier standard retirement age for the DC component of the multi-pillar pension plan than for the DB component of the multi-pillar pension." (Social Science Research Network)

George F. Will on the Governmental Pension Plan Time Bomb
Excerpt: "Vallejo [California] is an ominous portent for other cities, and some states, few of which are accumulating financial resources sufficient to fulfill pension promises they have made to employees. Are you weary of the crisis du jour -- subprime mortgages and all that? Get a head start on worrying about the next debacle by reading Roger Lowenstein's new book, 'While America Aged: How Pension Debts Ruined General Motors, Stopped the NYC Subways, Bankrupted San Diego, and Loom as the Next Financial Crisis.'" (Washington Post; free registration required)

Hedge Fund Glory Days Fading Fast
Excerpt: "Hedge funds, those secretive investment vehicles for the rich and, increasingly, the not-so-rich, are supposed to make money whether markets go up or down. But many of them are being swept up in the turmoil in the financial world." (New York Times)

PBGC Warns Of More Delphi Claims
Excerpt: "The U.S. pension insurance agency could file up to $2.5 billion in claims against bankrupt Delphi Corp's profitable foreign assets unless the auto supplier reaches a deal to resolve pension liabilities with former parent General Motors Corp this week." (Reuters via New York Times)

Small Businesses Face Deadlines for SEPs, SIMPLEs
Excerpt: "Small business owners who are thinking about setting up retirement plans for their employees should be aware that there are two important deadlines coming up in October that affect the plans known as SIMPLEs and SEPs." (USA TODAY)

GAO Warns Pension Plan Managers About Risks in Hedge Funds and Private Equity Arrangements
Excerpt: "Officials at the U.S. Government Accountability Office say the U.S. Labor Department should come up with guidance for defined benefit pension plan managers, and especially for managers of small pension plans, about the risks of investing in hedge funds and in private equity arrangements, and about strategies for handling those challenges." (National Underwriter Life and Health Insurance News)

[Opinion] Text of American Bankers Association Comments on Proposed DOL Regs on Disclosure in Self-Directed DC Plans (PDF)
15 pages. Excerpt: "Our concerns are based primarily on the fact that the Department has proposed a disclosure regime appropriate only for mutual fund products, not one that works well for many other fiduciaries, the institutions that serve those fiduciaries, plan participants, or many of the investment products offered to those participants. Specifically, we have strong reservations about this proposal and its impact on bank collective funds." (American Bankers Association)

[Opinion] Social Security and Private Savings Have Complementary Roles
Excerpt: "This brief explains the complementary roles of Social Security and voluntary personal savings. Social Security is insurance against the vagaries of retirement (including income-eroding inflation in old age), disability, and the death of a family worker. As insurance, it is about community: everyone shares the risks; and benefits go to those who experience insured losses. Savings, in contrast, are liquid assets that can generally be spent for any purpose at any time." (National Academy of Social Insurance)

[Opinion] QSERPs: How Companies Manipulate the Law to Fund Executive Pay Packages with Workers' Pension Money
Excerpt: "On August 4, the Wall Street Journal exposed an unethical practice in which companies use pension plans that are set up for their rank-and-file workers to finance extravagant retirement benefits for a small number of high-paid executives. This practice is a clear manipulation of federal tax and pension laws allowing companies to exploit tax breaks that are intended for the pensions of regular employees and instead use them to pay for executives' pensions." (Pension Rights Center)

Sponsored by: The National Institute of Pension Administrators

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Banner ad for The National Institute of Pension Administrators

NIPAís APA/APR online exam registration deadline is October 15

The National Institute of Pension Administratorsí (NIPA) Accredited Pension Administrator (APA) and Accredited Pension Representative (APR) designation exams will be administered online, beginning with the November 2008 exam testing period.

The new online exam format, the result of a partnership with KRYTERION, makes it easier and more convenient for retirement plan professionals to schedule and complete their APA/APR exams. Visit to download the November 2008 APA/APR brochure and to register by October 15.

(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

Apple Settles Shareholder Suits Over Stock Option Backdating
Excerpt: "A federal judge in San Jose has given preliminary approval to a $14 million settlement of shareholder claims over backdating of stock options against current and former Apple Inc executives, court documents showed." (Reuters via New York Times)

2007 Stats for IRA Assets and Contributions; Facts and Background on Domestic Partner Benefits
Excerpt: "IRAs are the largest repository of U.S. retirement wealth . . . . [and this Issue Brief] updates previous research by EBRI providing information on why employers offer domestic partner health benefits, legal issues involved, recent developments, and current data." (Employee Benefit Research Institute (EBRI))

Early Retirement? Why It Pays to Stay
Excerpt: "Companies across a range of industries, from financial services to retail, have been extending early-retirement packages in an effort to slash work forces." (

Newly Posted Events
(Post Yours!)

How to Do a Dependent Audit (60-Minute Power Series)
Nationwide on September 23, 2008
presented by International Foundation of Employee Benefit Plans

Care Management Measurement: Beyond ROI Webcast
Nationwide on September 25, 2008
presented by International Foundation of Employee Benefit Plans

QDROs, Rollovers and Working Retirement
Nationwide on October 15, 2008
presented by Qualified Pension Consulting, Inc.

Determination Letter Applications: A Practical Approach
Nationwide on September 30, 2008
presented by Qualified Pension Consulting, Inc.

Determination Letter Applications: A Practical Approach
Nationwide on September 24, 2008
presented by Qualified Pension Consulting, Inc.

New DOL Fee Disclosures Rules For Service Providers
in District of Columbia on September 24, 2008
presented by WEB (Worldwide Employee Benefits Network) Washington Chapter

National ERISA Fiduciary ExecuSummit
in New York on November 4, 2008
presented by ExecuSummit

Newly Posted Press Releases
(Post Yours!)

Treasury, SBA Partner to Help Small Businesses Understand the Value of Health Savings Accounts
U.S. Department of Treasury

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Business Analyst-SPGA Installation
for Transamerica Retirement Services
in CA

Data Analyst - Defined Benefits
for Vanguard
in PA

Senior Care Management Consultant
for Towers Perrin
in IL, NY

Benefit Administrator
for Vanguard
in PA

Pension Consultants/Administrators
for Northern & Central NJ Mid-Size Pension Consulting Firm
in NJ

Pension Consultant & Daily Valuation Administrator
for M.L.Kerns & Associates, L.L.C.
in TX

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