The Employee Benefit Security Administration (EBSA) recently began sending letters to 1,200 plan sponsors whose 2014 Form 5500 filings did not contain an independent auditor’s report. EBSA is taking the initiative to accelerate plan sponsors’ compliance requirements of filing a Form 5500 with the Department of Labor (DOL). This is another step, in addition to the audit quality study and sending communications to plan sponsors regarding the importance of hiring a quality audit firm, taken by the EBSA and DOL to protect plan participants and plan assets.
EBSA has indicated that these letters are not enforcement notifications, and therefore plan sponsors are not subject to the statutory 45-day correction period. Rather, these notifications are meant to make plan sponsors aware that an incomplete Form 5500 filing was submitted.
Plan sponsors are strongly encouraged to utilize these notifications to ensure that a completed Form 5500, one containing audited financial statements, is submitted. Failure to act by the plan sponsor on these notifications could result in a Formal Notice of Rejection by the DOL. Plan sponsors would then be under the 45-day correction period.
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