As the Plan Sponsor of a 401(k) Plan there are specific requirements related to fee disclosures if you allow the plan participants to direct their investment choices. You must provide information related to the:
- Investment options available.
- Performance of each of those investments.
- All the fees associated with each investment choice.
- All the expenses with each investment choice.
This information needs to be provided to each participant before they enter the plan and make their first investment selections and then annually after that. Most third-party providers will prepare the fee disclosure information for you but you should verify that all the required information is included and ensure that all participants are scheduled to and actually do receive the disclosures at the proper times. As a Plan Fiduciary, this is a required step to ensure your 401(k) Plan remains compliant.
For more detailed information related to plan expenses and required disclosures, you may visit the Department of Labor website under the Employee Benefits Security Administration section.
As the plan sponsor, when it’s time to audit your plan, it’s vital that you hire an experienced auditor to ensure your plan is in compliance. At Summit CPA we specialize in retirement plan audits. We have the ability to offer assistance entirely off-site with little or no distraction to your daily office routine. We also offer flat-fee pricing so there are no surprises on your bill when the job is complete. For assistance contact our office at (866) 497-9761 to schedule an appointment.