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NQ Client Services Manager (Private Label)
Newport Group
in Lake Mary FL / Dallas TX

Enrollment Specialist
Newport Group
in Charlotte NC / Lake Mary FL / Pittsburgh PA

Senior Non-Qualified Consultant
Newport Group
in Chicago IL / Lake Mary FL

Documents Specialist - Amendments and Ancillary
Newport Group
in Folsom CA / Mobile AL / Minneapolis MN / Saint Petersburg FL

Director, Employee Benefits
Department of Budget & Management, Maryland State Government
in Baltimore MD

Economist (Health)
Centers for Medicare & Medicaid Services, U.S. Department of Health and Human Services
in Woodlawn MD / Telecommute

ERISA Attorney
Barclay Damon LLP
in Syracuse NY / Albany NY / Buffalo NY / Rochester NY

DC Retirement Plan Consultant
USI Consulting Group
in Glastonbury CT

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[Official Guidance]

PBGC Adds Web Page for Published Notices to Participants (NTP)

"At times, PBGC places ads in local and national newspapers to inform participants that the agency is taking responsibility for their plan.... Publication of these ads end any expectation that participants will earn further benefits under their pension plan. [PBGC's] latest ads are curated on this page."
Pension Benefit Guaranty Corporation [PBGC]

[Advert.] -- The Leading ERISA Technical ReSource

Sponsored by Burrmont Compliance Labs LLC

What are you waiting for? It's all here, and easy to use. Nationally recognized authors. Continuously updated. Fully-linked Code/Reg/Other. Unrivaled customer support. Contact us 612-605-2266.

[Official Guidance]

PBGC Updates Coverage Form and Instructions

"PBGC's new form and instructions for requesting a determination about whether a plan is covered under title IV of ERISA has been approved by OMB and is now available for use. This form was created to streamline and simplify the coverage determination process. The instructions explain that in limited circumstances, under a one-year pilot program, employers may also use the form to request an Opinion Letter about whether a plan in the process of being created is likely to be covered by PBGC. PBGC's Coverage webpage has been updated accordingly."
Pension Benefit Guaranty Corporation [PBGC]

[Guidance Overview]

Implementation Considerations for Form CRS (PDF)

"[T]he initial Form CRS relationship summary may be electronically filed with the SEC as early as May 1, 2020 but must be filed no later than June 30, 2020. In addition to this filing requirement, the initial Form CRS relationship summary must be delivered to all existing retail investor clients on an initial, one-time basis within 30 days after the date the firm is first required to file its Form CRS relationship summary with the SEC.... [B]roker-dealers and investment advisers will need to document the delivery of the Form CRS relationship summary, even to prospective clients."
Eversheds Sutherland

2019 Defined Contribution Plan Sponsor Survey

"Most plan sponsors feel a high level of responsibility for employee financial wellness (74%) but less than half of those surveyed take proactive measures (41%) to position participants for success.... The percentage of plan sponsors offering automatic features has increased since 2013.... Many are overlooking key target date fund evaluation criteria."
J.P. Morgan Asset Management

High Earners Face Retirement Challenges

"The words highly compensated employee have a wonderful ring to them ... But for these high-ranking individuals in the top decile of U.S. earners, the prestige also brings some heady challenges around saving for retirement -- or whatever you call what comes after a career. And the higher an individual's compensation, the more severe the potential retirement income gap can be."


SPARK Forum - November 3-5, 2019 -- The Breakers, Palm Beach, FL

Sponsored by SPARK

Join us at the retirement services industry's leading event for top marketing, sales, administration and record keeping professionals. Comprehensive agenda includes topics for Record Keepers, 401(k) Plan Providers, Financial Advisors and Cyber Security Professionals.

Editor's Pick The SPIVA Scorecard: A Must-Read for 401(k) Fiduciaries

"Published by S&P Dow Jones Indices, the semi-annual report measures the percentage of actively-managed funds that outperform their market index benchmark over specific periods of time, net of fees.... [The year-end 2018 SPIVA Scorecard ] found only a small percentage of actively-managed funds outperform the market over time. The takeaway for 401(k) fiduciaries? There is a very good chance that low-cost passively-managed index funds and ETFs that seek to match -- not beat -- the market will offer superior investment returns over the long term."
Employee Fiduciary

Fidelity Says It's Entitled to Alleged 'Secret Payments' in 401(k) Plans

"Fidelity ... [asked] a federal court to dismiss a lawsuit alleging the fees caused the Boston-based firm to profit at the expense of customers' retirement savings and breached its fiduciary duty.... [T]he fee is nothing more than an 'arm's length' payment negotiated with certain money managers, and such compensation negotiations don't mean Fidelity is acting as a fiduciary, the firm said. Fidelity negotiated its 'infrastructure fees' with asset managers on the FundsNetwork platform in 2017." [Wong v. FMR LLC, No. 19-10335 (D. Mass. defendant's memo in support of motion to dismiss filed Jul. 1, 2019)]
InvestmentNews; subscription may be required

Pension Funding Update: June 2019 Investment Results

"Discount rates continued to fall in June, while equity markets rebounded strongly. Discount rates fell around 20 basis points -- again! Equity markets rallied close to 7% for the month! Overall, plans would have seen a modest improvement in their funding level[.]"
River and Mercantile Solutions

CBO Cost Estimate for H.R. 397: Rehabilitation for Multiemployer Pensions Act of 2019

"This estimate is for the discussion draft of H.R. 397 dated July 8, 2019 ... That legislation would provide funds for 30-year loans and new financial assistance (in the form of grants) to financially troubled multiemployer pension plans.... Plans would apply for both the loan and grants jointly. Certain plans would be required to apply. The loans and grants would be available only to plans that are currently financially troubled, as described in the bill; other plans would be eligible only for financial assistance that is available under current law."
Congressional Budget Office [CBO]


Congress Is Coming for Your IRA

"The Secure Act is widely expected to pass the Senate by unanimous consent. While ostensibly helping Americans save for retirement, the bill would actually reduce the value of all retirement savings plans: individual retirement accounts, 401(k)s, Roth IRAs, the works. The main problem with the Secure Act is that it eliminates the stretch IRA, the fixed star in the financial-planning firmament since 1999."
The Wall Street Journal; subscription may be required


The Case for New Public Pension Accounting Standards (PDF)

48 pages. "This report presents a critique of the existing accounting rules for public pension funds as formulated in the various statements of [GASB], and some suggestions about different directions that might help policy makers make better decisions about the pension plans they manage."
National Conference on Public Employee Retirement Systems [NCPERS]


SCOTUS Ruling May Have Implications for DOL Fiduciary Rule

"Kisor would seem to leave in place the courts' traditional deference to reasonable senior agency interpretations of ambiguous regulations that pertain to their area of focus. But that has implications for a potential revisiting of the Labor Department's fiduciary rule.... The [DOL] has indicated that it intends to reconsider a new fiduciary standard. If so, it stands to reason that 5th Circuit's opinion will be a factor in shaping it -- and, in the aftermath of Kisor, it seems likely that the [DOL] would be mindful to more closely observe its customary statutory territory." [Kisor v. Wilkie, No. 18-15 (S. Ct. Jun. 26, 2019)]
National Association of Plan Advisors [NAPA]

Benefits in General

[Official Guidance]

Text of AICPA SAS No. 136: Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA (PDF)

110 pages, Jul. 9, 2019. "This Statement on Auditing Standards (SAS) addresses the auditor's responsibility to form an opinion on the financial statements of employee benefit plans (EBPs) subject to [ERISA].... It also addresses the form and content of the auditor's report issued as a result of an audit of ERISA plan financial statements. This SAS applies to audits of single employer, multiple employer, and multiemployer plans subject to ERISA.... This SAS is effective for audits of ERISA plan financial statements for periods ending on or after December 15, 2020. Early implementation is not permitted."
American Institute of Certified Public Accountants [AICPA]

[Official Guidance]

Text of AICPA SAS No. 137: The Auditor's Responsibilities Relating to Other Information Included in Annual Reports (PDF)

100 pages; Jul. 9, 2019. "This SAS requires the auditor to read and consider the other information because other information that is materially inconsistent with the financial statements or the auditor's knowledge obtained in the audit may indicate that a material misstatement of the financial statements or that a material misstatement of the other information exists, either of which may undermine the credibility of the financial statements and the auditor's report thereon."
American Institute of Certified Public Accountants [AICPA]

Executive Compensation
and Nonqualified Plans

Delaware Chancery Court Refuses to Dismiss Derivative Action Alleging Breach of Fiduciary Duty Related to Equity Grants

"[T]he Delaware Chancery Court held that the plaintiff successfully pled, for purposes of surviving a motion to dismiss, that a company's board of directors breached its fiduciary duty to the company by approving sizable equity grants to several directors in violation of the company's equity incentive plan, that several board members and entity defendants were unjustly enriched by the equity grants, and that the board breached its duty of candor by making faulty disclosures when seeking stockholder approval for amendments to the company's incentive award plan in connection with the equity grants." [Reith v. Lichtenstein, No. 2018-0277 (Del. Chanc. Jun. 28, 2019)]
Thomson Reuters Practical Law

Selected Discussions
on the BenefitsLink Message Boards

HCE Waiver of Self-Correction Funds?

We have a client for whom we are doing a self-correction. Salary deferrals were not deducted from bonus wages per terms of the Plan plus the applicable matching contributions. However, an HCE doesn't want to be part of the correction -- wants to waive any funds he is otherwise due under the correction measure. The question is [1] can we allow this....have him sign a waiver? and [2] would this put the Plan in a worse position upon audit for not correcting the failure in full and in accordance with IRS Guidelines. Is there even a waiver option discussed in the IRS guidelines on correction?
BenefitsLink Message Boards

Coverage Testing of Multiple Plans: How to Handle Intragroup Transfers by Employees?

Three employers are members of a controlled group (A, B, C) and they each sponsor a 401(k) plan with different features. Each plan passes coverage separately -- but barely. Let's say an employee transfers mid-year from Employer/Plan A to Employer/Plan C, is that employee considered in Plan A only or Plan C only or both plans for coverage purposes?
BenefitsLink Message Boards

Prepayment of Loan OK?

A participant would like to prepay the remaining semi-monthly payments for the remainder of the year. Assume 6 months (12 payments) being made in a lump sum right now to cover all payment from 7/15/2019-12/31/2019. Assume the participant loan program allows for these ad hoc payments and sponsor is OK with it. Is this acceptable from an IRS standpoint or is it a violation of 72(p)?
BenefitsLink Message Boards

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Press Releases

Most Popular Items in the Previous Issue

Final Report on Connecticut Pension Sustainability (PDF)
Connecticut Pension Sustainability Commission, Inc.
1298 Minnesota Avenue, Suite H
Winter Park, Florida 32789
(407) 644-4146

Lois Baker, J.D., President
David Rhett Baker, J.D., Editor and Publisher
Holly Horton, Business Manager

BenefitsLink Retirement Plans Newsletter, ISSN no. 1536-9587. Copyright 2019, 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 those materials. You may not alter or remove any trademark, copyright or other notices from copies of the content.

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