Retirement Plans Newsletter

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Webcasts and Conferences

Evaluating the Reasonableness of Plan Fees in Light of the New Disclosures
(University Conference Services)

Evaluating, Selecting and Monitoring Target Date Fund Offerings
(University Conference Services)

Fiduciary Regulations
April 14, 2016 WEBCAST
(Convergent Retirement Plan Solutions, LLC)

Fiduciary Regulations
April 20, 2016 WEBCAST
(Convergent Retirement Plan Solutions, LLC)

Im A Fiduciary?!? ERISA Fiduciary Duties and the New Regulations
April 27, 2016 WEBCAST
(Findley Davies, Inc.)

All You Ever Wanted to Know About Late Remittances But Were Afraid to Ask
April 28, 2016 in CA
(Western Pension & Benefits Council - Orange County Chapter)

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[Official Guidance]

Text of GASB Statement 82: Pension Issues -- An Amendment of GASB Statements 67, 68 and 73
"The objective of this Statement is to address certain issues that have been raised with respect to Statements No. 67, Financial Reporting for Pension Plans, No. 68, Accounting and Financial Reporting for Pensions, and No. 73, Accounting and Financial Reporting for Pensions and Related Assets That Are Not within the Scope of GASB Statement 68, and Amendments to Certain Provisions of GASB Statements 67 and 68. Specifically, this Statement addresses issues regarding [1] the presentation of payroll-related measures in required supplementary information, [2] the selection of assumptions and the treatment of deviations from the guidance in an Actuarial Standard of Practice for financial reporting purposes, and [3] the classification of payments made by employers to satisfy employee (plan member) contribution requirements." (Governmental Accounting Standards Board [GASB])  


P&I Alternatives in DC Conference | May 12 | New York

Sponsored by Pensions & Investments

Register for this FREE, one-day event to learn about the benefits alternatives can provide. You'll learn how to choose assets, design the plan menu, incorporate alternative assets, and educate plan participants on new investment options.

[Guidance Overview]

DOL Redefines an ERISA 'Fiduciary' (PDF)
9 pages. "As a general theme, the exemptions differentiated a recommendation from general communication where a recommendation is deemed to be investment advice and subjects the advisor to be a fiduciary. Responsibilities are placed on the advisers intending to use an exemption to know or reasonably believe that the counterparty is a fiduciary.... An investment platform (which is often affiliated with or a part of recordkeeping services and asset managers) can avoid being considered offering recommendations if the communication is not individualized and clearly discloses in writing that the platform is not a fiduciary and should not be deemed as offering impartial investment advice." (Chao & Company, Ltd.)  

[Guidance Overview]

New Fiduciary Rule Applies Stricter Standard to Most Retirement Account Advisers
"Some things plans should consider include: [1] Determine if an adviser or consultant is currently a fiduciary under the new fiduciary rule. [2] Determine if one of the rule carve-outs applies to the services provided by adviser or consultant. [3] Discuss the Best Interest Contract Exemption with any adviser that is a fiduciary and determine the best way to document and comply with that exemption.... [P]lans should interpret the general fiduciary rule broadly and interpret any of the enumerated carve-outs narrowly.... Plans should require advisers to indemnify the plan from any prohibited transaction that arises as a result of its failure to comply with any carve-out or exemption." (Holland & Hart LLP)  

[Guidance Overview]

DOL Issues Final Fiduciary Definition Regulations (PDF)
"Key to determining whether 'fiduciary investment advice' has been given is whether a 'recommendation' has occurred. This is defined as a communication that 'would be reasonably viewed as a suggestion' to take a particular course of action, or refrain from doing so. The more the advice is tailored to the recipient, the more likely it will be viewed as a recommendation.... [T]he final rule provides a non-exhaustive list of certain types of communications that are not generally considered a recommendation. This includes making available a platform of investments, certain selection and monitoring assistance that meets objective criteria, general communications, and investment education." (Ascensus)  

[Guidance Overview]

Final DOL Fiduciary Rule -- First Impressions
"The DOL indicates in the preamble that the ongoing receipt of a 'level fee' typically would not raise prohibited transaction concerns because the compensation is not tied to investment recommendations, but that there is a 'clear and substantial' conflict of interest when advisers recommend investments in a level fee account if the adviser would not otherwise receive fees absent the investment. The DOL also emphasizes that it would be a non-exempt prohibited transaction to move a customer into a fee-based model that is not in the customer's best interest." (Morgan Lewis)  


Join the chorus of the LEADING voice of the Plan Sponsor!

Sponsored by Plan Sponsor Council of America [PSCA]

Join your peers to strengthen, refine, and amplify your voice at PSCA's 69th Annual National Conference. Hear the latest from Washington and learn the newest trends in DC plans to be a stronger and sharper advocate for your participants and your plan.

[Guidance Overview]

2016 Key Administrative Dates and Deadlines for Calendar-Year Multiemployer Defined Benefit Plans (PDF)
Detailed 3-page chart of notice and reporting requirements and their deadlines. (Milliman)  

Managing Missing Participant Accounts and Fiduciary Responsibility (PDF)
"When plan sponsors can't find a vendor willing to take a small account, they will sometimes write a check and mail it to the participant's last known address, thinking that this 'cash out' approach will satisfy their fiduciary obligations.... [W]hen a check does not get cashed -- and the smaller the amount, the more likely it will go uncashed -- the plan sponsor or trustee is still responsible for managing the funds. The fiduciary responsibility in this situation is not just to pay out participants; it's to make sure they receive their money. Or, in the absence of accepted payment, [to] appropriately manage the funds." (PenChecks)  

Fidelity, Putnam Lose Early Bids to Dismiss ERISA Lawsuits
"In an unusual move, a federal judge in the U.S. District Court for the District of Massachusetts April 7 issued a three-page order allowing two different proposed class actions to survive the companies' motions to dismiss. The judge didn't explain the reasoning behind his decision, other than to say that 'dismissal is often inappropriate' in 'factually complex' lawsuits under [ERISA].... Although both lawsuits involve allegations of excessive plan fees, they use different lines of attack. The Fidelity lawsuit focuses on the investment strategy of the company's stable value fund, and the Putnam lawsuit challenges the use of proprietary funds in Putnam's own 401(k) plan." (Bloomberg BNA)  

Stable Value Funds: A Fiduciary Quandary
"[T]he total economic impact on plan participants invested in SVFs is unknown since an insurance company's ... crediting rate on an SVF is still controlled and fixed by it, with absolutely no fiduciary duty to plan participants....[T]his doesn't help plan sponsors carry out their fiduciary duties prudently. But when low-cost, broadly diversified investment options constitute a retirement plan's investment menu, a plan sponsor cannot help but look like the leading luminary in that prudent afterglow." (Morningstar Advisor)  

Advisor's Guide to DOL Fiduciary and the New Best Interests Contract Requirement
"Fiduciary advocates have lamented that the [DOL] conceded several major points ... However, it appears that in reality the DOL fiduciary rule concessions were a brilliantly executed strategy of conceding to the financial services industry the exact parts that didn't actually matter in the long run (while still reducing the risk of a legal challenge), yet keeping the key components that mattered the most: a requirement for Financial Institutions to adopt policies and procedures to mitigate material conflicts of interest and eliminate incentives that could compromise the objectivity of their advisors ... and a second requirement that clients can no longer be forced to waive 100% of their legal rights and accept mandatory arbitration, instead stipulating that while an individual client dispute may be required to go to arbitration, consumers must retain the right to pursue a class action lawsuit against a Financial Institution that fails to honor its aggregate fiduciary obligations." (Michael Kitces in Nerd's Eye View)  

Fiduciary Opponents to DOL: See You in Court?
"Now that the final rule is out, insiders are even more convinced that lawsuits are on the way.... Jack Marrion, CEO of the consulting firm Advantage Compendium, is confident the rule will never go into effect. 'I sincerely believe the final outcome is that ... the entire rule will be stayed and returned to the DOL to redo their economic analysis -- which they are unlikely to do in the next administration,' Marrion said. 'So I think it will die before it goes into effect.' ... To date, the most litigious rumblings have come from the offices of the U.S. Chamber of Commerce." (  

Boomer Expectations for Retirement 2016: Sixth Annual Update on the Retirement Preparedness of the Boomer Generation
19 pages. "There are about 76 million Baby Boomers in the United States, more than 40 million of whom are already age 65 or older.... They will retire at a rate of 10,000 per day through at least 2030, when almost 73 million Americans, comprising more than 20 percent of the U.S. population, will be age 65 or older.... 21 percent of Boomers plan to retire prior to age 65, and 59 percent at age 65 or older. This includes 26 percent who plan to retire at age 70 or later.... Only 39 percent of Boomers have tried to figure out how much they need to have saved for retirement. Of those who have, a third did not include health care costs in their calculations. Only 55 percent of Baby Boomers have money saved for retirement, down from 58 percent last year and from more than three in four in prior years." (Insured Retirement Institute [IRI])  

RMD Dilemma: Death in the Age 70-1/2 Year
"One of the most confusing situations in the complex world of required minimum distributions (RMDs) is what happens when an individual dies on or after Jan. 1 of the year in which he or she turns 70-1/2 but before his or her actual 'required beginning date.' " (Morningstar)  


Honesty on Pension Debt: It's Now or Never
"Governments don't go bankrupt for one reason alone. But every financially troubled government in recent years has had a poorly managed pension plan in the background.... Reform-minded members of Congress, including Senate Finance Committee Chairman Orin Hatch, R.-Utah, want any legislation to require all state and local governments to accurately disclose their pension liabilities. But draft legislation from House Republicans would require this of Puerto Rico alone." (American Enterprise Institute)  


A Revolutionary Retirement Plan?
"[The author takes] issue with claims that [Prof. Teresa Ghilarducci's Revolutionary Retirement Plan] is 'deficit neutral.' Really? So people are going to be investing in products that are mostly based on the whims and fancies of public markets and when they retire, they will convert their savings into annuities which will lock them into ultra low rates for years? And this is deficit neutral? All this will do is ensure more pension poverty and higher social welfare costs down the road (raising the debt and deficit)." (Pension Pulse)  

Executive Compensation and Nonqualified Plans

Pay Ratio Disclosures Begin to Appear in Proxy Statements
"Some companies have begun to disclose pay ratios in their proxy statements in advance of the SEC requirement. [Samples are included in this article.] Of course, you'll want to compare the samples to the rules before relying on them." (, a blog by Stinson Leonard Street)  

Press Releases

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BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2016, Inc. All materials contained in this newsletter are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of, Inc., or in the case of third party materials, the owner of that content. You may not alter or remove any trademark, copyright or other notice from copies of the content.

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