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"A fiduciary is someone who has undertaken to act for or on |
As you are probably aware, the new Form 5500 and Schedule C requires much more cost and fee disclosure as well as an affirmation that the plan has no “prohibited transactions”. According to the Department of Labor, “If the consultant is a fiduciary under ERISA and receives fees from third parties as a result of their recommendations, a prohibited transaction under ERISA occurs unless the fees are used for the benefit of the plan (e.g., offset against the consulting fees charged the plan) or there is a relevant exemption.” (See “Selecting And Monitoring Pension Consultants - Tips For Plan Fiduciaries”)
The updated 5500 was designed to work together with the new 408 (b)(2) regulations. As a result, some service providers may not make the disclosures which are necessary to accurately complete the updated Schedule C.
So what is a plan auditor to do? MillenniuM has a number of resources designed to help auditors perform their audit function and supply the correct information to fully disclose fees and conflicts that could result in prohibited transactions. Further, we can provide auditors with CPE eligible training on how to find the true costs of the plan (even costs which are not currently disclosed). This allows you to provide genuine value to your clients, and keep the Department of Labor happy all at the same time. Email us or call us at (866)-401k-IRS. We look forward to hearing from you.
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