To ensure that employee’s rights are protected and that pension plans are set up and administered fairly, the federal government mandates that under the requirements of ERISA (Employment Retirement Income Security Act) Section 103, employee benefit plans with 100 or more participants are considered ‘large’ plans and must have an audit performed by an independent, certified public accountant and must file a Form 5500 (an annual report).
Plans with fewer than 100 participants at the beginning of the plan year are considered ‘small’ plans and are eligible for the Small Pension Plan Audit Waiver. However, the Department of Labor (DOL) has identified the range of 80 – 120 participants (at the beginning of the plan year) as a grey area where the company has the option to continue as a ‘small’ plan or elect ‘large’ plan status. The choices for a plan falling into the 80 – 120 participant range are as follows:
| Number of Participants at Beginning of Current Year | Requirements Followed for the Previous Year Form 5500 | Requirements to Be Followed for the Current Year Form 5500 |
| 80 – 99 (inclusive) | Small plan | Small plan |
| 80 – 99 (inclusive) | Large plan | May elect to file Form 5500 again as a large plan or switch to a small plan |
| 100 – 120 (inclusive) | Small plan | May elect to file Form 5500 again as a small plan or switch to a large plan |
| 100 – 120 (inclusive) | Large plan | Large plan |
| More than 120 | Large plan | Large plan |
| More than 120 | Small plan | Large plan |
If your employee benefits plan is required to have an audit, you’ll want the audit the process to go as smoothly as possible for you. When you choose your pension plan auditor, you’ll want an experienced firm who will work with you to make the project a positive experience for you and your company.
ELLS has a dedicated team of experienced auditors to perform your next audit in an efficient, timely manner and will make the experience as stress-free as possible. We pride ourselves in having extremely low staff turnover, enabling us to provide you with audit team continuity year after year.
In addition to the audit, ELLS will also complete the required annual Form 5500 as well as pension plan accounting and the compilation of the Summary Annual Report.
We invite you to call us today to discuss performing your next employee benefit plan audit.
If you need ERISA Employee Benefit Plan Audits, feel free to contact Maria T. Arriola!
