The Numbers:
81,162 --Number of plan filings with accountant's opinions
31,653 --Number of accountant's opinions with major deficiencies
79% --Deficiency rate of audit firms doing the fewest audits
653 billion --Plan assets at risk
22.5 million --Participants at risk
The Source
The numbers are from a report called "Assessing the Quality of Employee Benefit Plan Audits." The Report was written by the Office of the Chief Accountant (OCA) of the Employee Benefits Security Administration and published by U.S. Department of Labor a few days ago.
OCA Recommendations
The OCA makes the following recommendations:
The Report suggests to me some obvious but important things. There are some folks that ought not be in the business of plan audits; you do not want to hire one of them. Plan sponsors need to have a very careful selection process for hiring an auditor that weeds out the incompetent. Cleaning up the mess left behind by a bad audit is time consuming and expensive. Why not do all you can do to avoid that possibility?
To learn more about plan audits and how to hire an auditor, get a subscription to the Fiduciary Responsibility eSource at ERISApedia.com.
81,162 --Number of plan filings with accountant's opinions
31,653 --Number of accountant's opinions with major deficiencies
79% --Deficiency rate of audit firms doing the fewest audits
653 billion --Plan assets at risk
22.5 million --Participants at risk
The Source
The numbers are from a report called "Assessing the Quality of Employee Benefit Plan Audits." The Report was written by the Office of the Chief Accountant (OCA) of the Employee Benefits Security Administration and published by U.S. Department of Labor a few days ago.
OCA Recommendations
The OCA makes the following recommendations:
- Target auditing firms with small audit practices and large amounts of plan assets, and firms that perform between 25 and 99 audits per year
- Work with the National Association of State Boards of Accountancy (NASBA) and the AICPA to improve investigation and sanctioning process at the state level
- Amend ERISA to apply annual reporting civil penalty (of up to $1,100 per day) against accountants
- Work with AICPA Peer Review Staff to improve the peer review process.
The Report suggests to me some obvious but important things. There are some folks that ought not be in the business of plan audits; you do not want to hire one of them. Plan sponsors need to have a very careful selection process for hiring an auditor that weeds out the incompetent. Cleaning up the mess left behind by a bad audit is time consuming and expensive. Why not do all you can do to avoid that possibility?
To learn more about plan audits and how to hire an auditor, get a subscription to the Fiduciary Responsibility eSource at ERISApedia.com.
RSS Feed
