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Pension Audits

Top NYC CPA Firm · Best Rated Accountants in New York City

Pension Audits

When you set up a retirement or pension audits program for your business, be aware that the IRS and the Department of Labor (DOL) both oversee retirement plans. These agencies often work together to make sure that your company is managing your retirement and pension plans to the benefit of your employees who participate in them. So whenever you decide to set it up, that’s the time to bring in a qualified accountant to make sure the plan can pass muster.

Miller & Company can explain what you need to know about retirement and pension plans; call 718-767-0737 today. Miller & Company LLP, NY Certified Public Accountants, a top rated CPA New York firm.

The IRS gets involved with retirement and pension audits plan primarily to look at issues pertaining to the eligibility, distribution and participation of plans. The IRS specifically focuses on verifying all minimum participation requirements, discrimination tests and vesting requirements. Just like the DOL, the IRS maintains the goal of making sure all the plan’s assets benefit participants of the retirement program.

DOL Jurisdiction over Pension Plans

The Employee Benefit Security Administration (EBSA), a branch beneath the Department of Labor, has direct jurisdiction over pension audits plan. The DOL’s main concern is to ensure that the contributions of pension participants are deposited in a timely fashion into those employee accounts. The EBSA can request and review your pension plan documents at any time. These documents can include:

  • Your plan document and related disclosures
  • Form 5500 filings and annual reports summary
  • Documents that detail plan sponsor or employer responsibilities related to plan payment costs
  • Administrative services agreements and third-party agreements
  • All other documents and records related to your plan operations

The EBSA distributes an enforcement manual detailing what you need to know for retirement and pension plan compliance. The agency aids participant and sponsor awareness of the fees associated with retirement plans. Service providers of retirement plans should be providing this information to fiduciaries who then pass this information on to the participants of the plan. Disclosures of this nature are part of the review process during an EBSA audit.

Why You Need a Pension Audit

The pension audits and enforcement of both the DOL and the IRS ensure that the terms and conditions of your retirement and pension audit plans adhere to the highest legal and ethical standards. This is why you need skilled third-party pension auditors like top NYC accountant, Miller & Company. Whether you’re located in Manhattan, the surrounding New York City metropolitan area or beyond, consider the benefits of a pension audit.

The CPA-auditors at Miller & Company with office locations in NYC and Queens provide periodic or annual pension audits for your retirement and pension plans. They verify that your company is up-to-date on all the proper internal controls. They ensure that you’re adhering to the strict, ethical guidelines of the EBSA enforcement manual. Through a pension audit, you gain the peace of mind you need to stick to doing what you do best —working to increase your profits and your company’s success.

Types of Occupational Pension Plans

There are two forms of occupational pension audits plan:

  1. Defined Contribution Schemes — or Money Purchase Schemes
  2. Defined Benefit Schemes — also called Final Salary Schemes

The auditors and accountants in NYC at Miller & Company ensure that the records of both types of pension accounts match the information from your payroll records and the scheme’s advisors. For Defined Contribution Schemes, the auditors verify that your company has paid the agreed upon contribution amounts within the set timeframe. For Defined Benefit Schemes, the auditors test and verify that your company is paying contribution amounts that were set by the actuary of the scheme.

Pension Audit Requirements and Consequences

If an EBSA pension audit uncovers an issue, the DOL and the IRS can get involved. These government agencies enforce one of several correctional programs geared to help get your plan back on track:

  • Voluntary Fiduciary Correction Program
  • Delinquent Filer Voluntary Correction Program
  • Employee Plans Compliance Resolution System

Of course, it’s best if problems within your pension or retirement plans are caught sooner. That’s one of the best reasons the expense of a pension audit by an independent auditor — one who has your interests in mind — makes financial sense. Self-examination through a third-party pension audit provides protection from government correctional programs in the event of an IRS or DOL audit.

Additionally, retirement and pension audits plan — also referred to as occupational pension schemes — are required to provide financial statements to the plan’s participants every year. A pension audit is necessary to calculate these financial statements, and the conclusions become part of your company’s pension audit report.

Getting a Pension Audit

After you hire the NYC auditors at Miller & Company, your company has to open its doors and its books for the pension audit. Because a DOL audit verifies that your plan expenses are correct, that’s what your third-party auditors also have to ensure. You have to deliver:

  • Draft pension scheme accounts, which typically include:
    • The Statement of Net Assets, which is similar to a balance sheet
    • A profit and loss statement or a fund account
  • Pension plan reports from:
    • Key managers
    • Plan advisors
    • Plan actuaries
    • Investment and scheme administrators
  • Access to employees and participants of the pension plan

Typically, the Miller & Company auditors spend two to three days on-site at the pension scheme or company offices. During the audit, they cross-reference transaction samples with employee receipts and other related documents. The auditors have to verify that the accounts are properly and accurately prepared. They check that contribution payments have been made in a timely manner and that the details conform to the schedule of contributions that the plan’s participants have agreed on.

The Pension Audit Conclusion

At the conclusion of your pension audit, the thorough auditors at Miller & Company typically prepare two reports:

  1. The first report serves as an independent audit of the financial statements, verifying that the scheme’s accounts are an accurate view and that they meet all the accounting requirements.
  2. The second report is a statement from the auditor that certifies all payments were made in accord with the pension’s schedule of contributions.

Your pension scheme’s trustees must sign the audit — as well as the financial statements — within seven months of the scheme’s year end. The signed report and financial statements don’t have to be filed with any governing agencies, but they must be on-hand in case a regulator or a member of the pension asks for a copy.

The auditors also sign the reports — they are official documents — and include them in the trustees’ annual report. This audit prepares your company for a pension audit by the EBSA or the IRS. To ensure that your company’s pension plan is bullet-proof, call Miller & Company to request your pension audit.

Do you have questions about services we offer including Pension Audits in NYC and Long Island? Would you like to receive a personal Pension Audits consultation customized to your specific needs? To schedule an appointment with a nationally recognized, top NYC accountant, Paul Miller of Miller & Company LLP firm, please contact our Long Island or NYC tax accountants for a FREE CPA consultation.

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The information on this site is to be used for informational purposes only and is not intended or implied to be a substitute for professional CPA or accountant advice. It is important to visit a highly specialized CPA firm in New York with top rated, best in class NYC accountants regarding creative ideas customized to your specific needs. Visit a leading Accounting firm in NYC and Queens, NY Miller & Company LLP. We are taking an exceptional individual care of each client.