When it’s time to conduct an employee benefit plan audit, it’s unwise to assume any audit team can fill the role. Not all auditors have the experience to be known in the industry as an “employee benefit plan auditor.”
Some accountants lack the knowledge and expertise needed to ensure compliance with rules and regulations, and this could cost you both money and your reputation.
Bennie Lewis, CPA, President, Partner at Assurance Dimensions, LLC, said, “Although a retirement plan is a great way to incentivize, retain talent, and get them to save for retirement, it is fraught with rules and requirements that many businesses need help with. Key risks include timeliness of contributions, eligibility, and contribution requirements.”
Before you contact the first accounting firm in your Google search, take the time to ask, “Is this employee benefit plan auditor qualified?”
Here’s what could happen if the answer is “no,” but you decide to work with them anyway.
The Risk of an Unqualified EBP Auditor
Recently, the Department of Labor (DOL) found that 30% of benefit plan audits are deficient, indicating an error in reporting or the application of the benefit program.
Sadly, when it comes to the quality of submitted audits, 12% of firms are responsible for a significant 81% of low-quality audits.
The consequences of those mistakes are drastic. It can result in plan disqualification, penalties, and re-audits, all of which fall back on your company, requiring more time and money than you may have budgeted.
What to Look for in an Employee Benefit Plan Auditor
Experience matters, especially when it comes to the work of an employee benefit plan auditor. Before agreeing to work with an accounting firm to conduct your audit, look for these professional qualifications:
- Audit volume and specialization: Does your auditor specialize in employee benefit plans? If the answer is no, you should consider contacting an audit firm that does.
- Membership in the AICPA’s EBPAQC (Association of International Certified Public Accountants’ Employee Benefit Plan Quality Center): Membership in this organization highlights your auditor’s commitment to quality standards and compliance with regulatory boards.
- Understanding of ERISA, Form 5500 requirements, and fiduciary responsibilities: Your auditor needs to stay on top of these rules and requirements. They should know the ins and outs of each rule and what it means for your business.
- History of clean peer reviews: Participating in peer reviews is a clear indicator of your auditor’s commitment to best practices. Take a clean peer review as a green light to work with them.
Why Plan Sponsors Trust Assurance Dimensions
At Assurance Dimensions, we understand that your employee benefits plans are a lifeline for your workers. That’s why we aim to provide audits that are accurate, clean, clear, and meet regulatory standards.
Our team conducts a high volume of EBP audits annually, and we are deeply versed in ERISA and DOL requirements.
We take the time to understand our clients and their businesses, tailoring our process to meet the needs of their plan. Doing this proactively identifies issues before they become problems. Your peace of mind is our end goal.
Contact Assurance Dimensions today for a benefit plan audit consultation.