Employee Benefit Plan Audit

 

Dedicated employee benefits practice

The DOL conducted a study examining audits of employee benefit plan financial statements for the 2020 filing year for Form 5500, Annual Return/Report of Employee Benefit Plans. The DOL’s EBSA found serious problems with 30% of employee benefit plan audits having one or more major deficiencies. This represents a decline from the 39% major deficiency rate reported in the previous study conducted in 2015.

The statistics show that the size of an independent accounting firm’s employee benefit plan practice correlates with the audit quality. As the study demonstrates, deficiencies with audits were less common with firms auditing more than 100 plans per year. LBMC audits approximately 400 employee benefit plans annually.

On-Demand Webinars

Employee Benefit Plan Audit Overview

If your company has a 401(k), 403(b), or similar retirement plan with more than 120 active participants, you will need an Employee Benefit Plan Audit. One of the most important decisions a plan administrator makes as part of their fiduciary duties is selecting a qualified, independent audit firm. So when making this decision, what really matters? Watch this video to learn:

On-Demand Webinar Duration: 06:08
Recorded (10/7/2021)

Speakers:

WATCH VIDEO

Retirement Plan Financial Statements

Retirement plan financial statements contain a wealth of information about the financial health of your plan and understanding them is an important fiduciary responsibility. This session will assist fiduciaries in:

  • Understanding the basic structure of retirement plan financial statements
  • Learning what is required to be included in retirement plan financial statements
  • Understanding management’s various responsibilities for the financial statements

On-Demand Webinar Duration: 53:46
Recorded (7/21/2022)

Speakers:

Mark Blackburn, CPA – Shareholder, Audit
Jenny Merritt, CPA – Senior Manager, Employee Benefit Plan Audit

WATCH VIDEO

Preparing for Your First Employee Benefit Plan Audit

Explore Our Guide

Our Areas of Employee Benefit Plan Audit Specialization

Defined Contribution Plans

  • 401(k) Plans
  • SEC Form 11-K Filings
  • 403(b) Plans
  • Profit Sharing Plans

Defined Benefit Plans

  • 401(k) Plans
  • SEC Form 11-K Filings
  • 403(b) Plans
  • Profit Sharing Plans

Health and Welfare Plans

Employee Stock Ownership Plans (ESOP)

Form 5500 preparation

Selecting a Plan Auditor

When evaluating auditors, look for an experienced firm look for one that has audited more than 300 plans per year, has ongoing training of their audit team, has a keen understanding of the latest technical and financial requirements, and a member of the AICPA Employee Benefit Plan Audit Quality Center

Three Factors to Consider When Choosing a Benefit Plan Auditor

1. Licensing for a benefit plan auditor

Federal law requires an employee benefit plan auditor to be licensed or certified as a public accountant by a State regulatory authority. In addition, the auditor must be independent and not have any financial interests in the plan or the plan sponsor.

2. Experience and training

Employee benefit plan audits are quite different from corporate audits. One of the most common reasons for deficient accountants’ reports is the failure of the auditor to perform tests in areas unique to benefit plans. The more training and experience an auditor has with employee benefit plan audits, the more familiar the auditor will be with specialized benefit plan auditing standards. Some key questions to ask when considering an auditor are: How many employee benefit plan audits do they perform each year? Does the audit firm have a dedicated team that focuses on employee benefit plan audits?  Is there specialized employee benefit plan audit training?

3. Association memberships

Is the audit firm a member of the American Institute of Certified Public Accountants (AICPA) and the Employee Benefit Plan Audit Quality Center (EBPAQC)? The EBPAQC is a voluntary membership center to help firms meet the challenges of performing audits of employee benefit plans. Being a member requires the firm to be in compliance with rigorous standards and practices specific to plan audits. In addition, the AICPA and EBPAQC requires its members to have their audit practice reviewed by internal and external qualified auditors. Visit the EBPAQC site to learn more about the requirements.

Employee benefit plan audits have increasingly become the subject of examination by the DOL and IRS.  An adverse examination from the DOL or the IRS related to an incomplete, inadequate, or untimely annual report may result in penalties being assessed against the plan administrator, so it is imperative to select a qualified employee benefit plan auditor. View a full list of member firms.

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Headquarters (Nashville, TN):
201 Franklin Road
Brentwood, TN 37027

Mailing Address:
P.O. Box 1869
Brentwood, TN 37024-1869

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