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June 12, 2009 \ Compliance \ Costs \ Administration \ Design \ Policy

DATAIR Employee Benefit Systems, Inc. (Advert.)

DATAIR 5500 / PBGC / 1099-R / 5300 / FAS 158 Software (clickable image)

DATAIR 5500 / PBGC / 1099-R / 5300 / FAS 158 Software

Pension Reporter System. Easy to use and economical electronic and paper filing. Full instructions and expert support. Choose from 4 modules:
* Annual Reporting Series: EFAST 5500-series, PBGC Premium-series, SAR, and 5500 electronic filing
* 1099-R Series: with related forms and 1099 electronic filing/Service Bureau
* Qualification & Termination: 5300/5310-series and PBGC 500/600-series forms
* FAS 132/158: Audit Letter, Worksheets, Schedules or call 1-888-324-2474

[Official Guidance]
Text of IRS Notice 2009-56: Update for Weighted Average Interest Rates, Yield Curves, and Segment Rates (PDF)

4 pages. Excerpt: "This notice provides guidance as to the corporate bond weighted average interest rate and the permissible range of interest rates specified under § 412(b)(5)(B)(ii)(II) of the Internal Revenue Code as in effect for plan years beginning before 2008. It also provides guidance on the corporate bond monthly yield curve (and the corresponding spot segment rates), the 24-month average segment rates, and the funding transitional segment rates under § 430(h)(2). In addition, this notice provides guidance as to the interest rate on 30-year Treasury securities under § 417(e)(3)(A)(ii)(II) as in effect for plan years beginning before 2008, the 30-year Treasury weighted average rate under § 431(c)(6)(E)(ii)(I), and the minimum present value segment rates under § 417(e)(3)(D) as in effect for plan years beginning after 2007." (Internal Revenue Service)

Equity Firm Pays $30 Million in Pension Fund Case
Excerpt: "The private equity firm Riverstone Holdings agreed on Thursday to pay $30 million to resolve its role in a widening public pension fund investigation by the New York attorney general, Andrew M. Cuomo." (The New York Times; free registration required)

Stable Value: A Closer Look at This Hybrid Fixed Income Strategy
20 pages. Excerpt: "Executive summary. The financial crisis and credit crunch in 2008 have prompted plan sponsors and investors to reassess the return and risk of their investment assets. Even stable value and money market funds -- investment vehicles often considered the safest options in 401(k) plans -- have been subject to increased scrutiny (Kim and Laise, 2008). Given investors' risk-reward reassessments as well as the recent cash inflows into fixed income securities, this paper examines some of the unique characteristics of stable value funds and details the benefits and potential downsides to investing in funds of this type. We also look at the performance characteristics as well as recent negative plan events affecting these funds." (The Vanguard Group, Inc.)

Workers Sticking by 401(k) Plans, Study Shows
Excerpt: "[Charles] Schwab found that among the companies whose plans it manages, 77% of eligible employees participated last year, up from 73% in 2007, according to analysis released yesterday. The firm said the uptick was largely due to companies increasingly enrolling new employees automatically." (

Law Firm Looks into Securities Lending at Northern Trust 401(k)
Excerpt: " The Keller Rohrback L.L.P. class-action law firm announced Thursday that it is investigating the investment activities of Northern Trust Company (NTC) and Northern Trust Investments (NTI), focusing on their securities lending program in The 401(k) Savings and Profit Sharing Plan of The McGraw-Hill Companies. The news release said the program may have resulted in severe losses to the participants' retirement savings in violation of the Employee Retirement Income Security Act of 1974 (ERISA)." (; free registration required)

Bill Advances with Thrift Savings Plan Reforms, But Not Sick Leave Fix
Excerpt: "The Senate on Wednesday advanced major legislation that includes several provisions expanding federal employees' options under the Thrift Savings Plan, but does not allow some employees to count unused sick leave toward retirement savings. In a 67-30 vote to end legislative debate, lawmakers moved H.R. 1256 forward, but without an amendment that would have enabled federal workers in the Federal Employees Retirement System to count unused sick leave toward their retirement annuities -- a benefit employees in the older Civil Service Retirement System currently have." (

The Knowledge Congress Webcast Series (Advert.)

The Knowledge Congress’ Live Webcast on 401(k) Plans on 07/23/09 (clickable image)

The Knowledge Congress’ Live Webcast on 401(k) Plans on 07/23/09

401(k)s have long been considered as a rock solid way to plan for retirement. In the wake of the recent economic tsunami, personal wealth has plunged leaving many employees form the executive suite to the mail room scrambling to reassess their 401(k) next egg. A key panel of thought leaders and experts will cover many of the most critical issues surrounding the 401(k) crisis with the goal to help you navigate through the pitfalls in the wake of these turbulent economic times.

Links to Items on Executive Comp, Benefits in General

[Official Guidance]
Treasury Department Fact Sheet on Compensation Committee Independence (PDF)

Excerpt: "We will propose legislation that will give compensation committees greater independence, just as Sarbanes-Oxley did for audit committees. The legislation will direct the SEC to promulgate rules requiring companies listed on national securities exchanges to meet exacting standards for independence. Under these rules, not only would compensation committee members be truly independent from management, but the committee's compensation consultants and legal counsel would be answerable only to the committee." (U.S. Department of the Treasury via American Benefits Council)

[Official Guidance]
Treasury Department Fact Sheet on Say-on-Pay Measures (PDF)

Excerpt: From the 4th item on the factsheet: 'Shareholders will have the right to cast a non-binding vote on golden parachutes: Consistent with the say-on-pay legislation President Obama co-sponsored while in the Senate, shareholders will have the opportunity to cast a non-binding vote to approve or disapprove golden parachute compensation disclosed in proxy solicitation materials prepared for shareholder meetings relating to a merger, acquisition, or other transaction that may involve a change in control of the corporation." (U.S. Department of the Treasury via American Benefits Council)

[Guidance Overview]
More on the Obama Administration's Proposal to Reform Executive Compensation

Excerpt: "As promised yesterday, this Blog will include more detail on the Obama Administration's five point program for reforming the executive compensation. Note, this proposal is intended to apply beyond the financial services industry." (Michael Melbinger via Winston & Strawn LLP)

[Guidance Overview]
IRS Addresses Certain Nonqualified Deferred Comp Payments in Stock Transactions with Financial Entities

Excerpt: "In Notice 2009-49, the IRS explains that it anticipates that most of the financial institutions involved in TARP equity acquisition transactions are, and will be, sponsors of nonqualified deferred compensation plans subject to Sec. 409A. The agency then states, 'The Treasury Department and IRS have determined that a Treasury EESA equity acquisition transaction is not a change in control event under section 409A and the final regulations. Treating a Treasury EESA equity acquisition transaction as a change in control event and, therefore, a permissible payment event, would be inconsistent with the purposes of EESA and section 409A, and would be contrary to the public interest." (Wolters Kluwer)

Executives Unruffled by Administration's Proposed Compensation Rules
Excerpt: "While the White House's new so-called special master for compensation, prominent Washington lawyer Kenneth R. Feinberg, has been given unprecedented powers to set pay at seven of the most troubled firms, the plan that was laid out Wednesday largely maintains the status quo for compensation practices at all other publicly traded companies, including hundreds that are receiving taxpayer assistance. In addition, the administration got rid of a previously announced $500,000 salary cap at financial firms that in the future take the kind of exceptional assistance that firms such as Citigroup and Bank of America have received." (The Washington Post; free registration required)

Opening Statement to House Committee by Treasury Counselor Gene Sperling Addressing Federal Executive Compensation Controls
Excerpt: "Our goal is to help ensure that there is a much closer alignment between compensation, sound risk management and long-term value creation for firms and the economy as a whole. Our goal is not to have the government micromanage private sector compensation. . . . We also recognize these principles may evolve over time, and we look forward to engaging in a discussion with this Committee, the Congress, supervisors, academics and other compensation experts, shareholders and the business community about the best path." (U.S. Department of the Treasury)

IRS Proposes Safe Harbor Rule for Taxing Work Cell Phone Use
Excerpt: "The Internal Revenue Service (IRS) is considering a new rule to tax a quarter of employees' use of employer-provided cell phones as a fringe benefit, Dow Jones reported. The Dow Jones news report said the IRS is considering simplifying existing recordkeeping requirements about employee cell phone use. The IRS proposal would be for a safe harbor rule deeming 75% of work cell phone usage to be for work and 25% to be personal and taxable as a fringe benefit, Dow Jones explained." (; free registration required)

Webcasts and Conferences

403(b) Plan Workshop: Implementing Recent Guidance for Tax Exempt and Government Employers
Nationwide on July 7, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)

Retirement, Deferred Compensation, and Welfare Plans of Tax-Exempt and Government Employers
in District of Columbia on September 10, 2009
presented by ALI-ABA (American Law Institute-American Bar Association)

Voluntary Fiduciary Correction Program Workshop
in California on July 8, 2009
presented by U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

(Click to post your webcast or conference)

Press Releases

Actuaries Weigh in on Ways to Address Risk Exposures and Challenges with the U.S. Health Care System
Society of Actuaries

PBGC Assumes Amsterdam Memorial Hospital Pension Plan
Pension Benefit Guaranty Corporation (PBGC)

PBGC Seeks Recovery on Behalf of Tom's Foods Inc. Pension Plan
Pension Benefit Guaranty Corporation (PBGC)

U.S. Labor Department Recovers More Than $9 Million for Retirement Plans of Bankrupt Aloha Airlines
U.S. Department of Labor, Employee Benefits Security Administration (EBSA)

Great-West to Sponsor 403(b) Prototype Plan
Great-West Retirement Services

SHRM Calls for Flexible, Voluntary Federal Policy on Paid Leave
Society for Human Resource Management (SHRM)

White Horse Advisors Adds Republic National Distributing Company to Its Client Roster
White Horse Advisors, LLC

Austen Riggs Center Selects MassMutual for 403(b) Plan

NAPFA Salutes Congressional Leaders In Efforts To Protect 401(k) Participants
National Association of Personal Financial Advisors (NAPFA)

Mercer Announces Expanded Health and Benefits Administration Outsourcing Solution

(Click to post your press release)

Employee Benefits Jobs

Sr. Benefits Specialist
for Kohler Co
in WI

Client Services Associate
for Milliman
in TX

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