Meeting Your Fiduciary Responsibility
Kimberly A. Reed Principal, CPA
05 November 2017
Offering a 401(k) or 403(b) Plan to your employees is a great benefit to help them save for retirement. However, as fiduciary of the Plan, it is your responsibility to make sure the assets of the Plan are safeguarded and available for your employees when they are ready to retire.

The Department of Labor offers the following tips for employers with retirement plans:

  • Identify your plan fiduciaries and ensure that they are clear about the extent of their fiduciary responsibilities.

  • If participants make their own investment decisions, provide the plan and investment-related information that participants need to make informed decisions about the management of their individual accounts.  Provide sufficient information for them to exercise control in making investment decisions.

  • Make sure you are aware of the schedule to deposit participants’ contributions in the plan and make sure that it complies with the law.

  • If you are hiring third-party service providers, consider a number of different providers and give each potential provider the same information. Then, determine whether the fees are reasonable for the services provided.

  • Document the hiring process.

  • Be prepared to monitor your plan’s service providers?

  • Identify parties in interest to the plan and take steps to monitor transactions with them.

  • Be aware of the major exemptions under ERISA that permit transactions with parties in interest, especially those key for plan operations (such as hiring service providers and making plan loans to participants).

  • Review your plan document in light of current plan operations and make necessary updates. After amending the plan, provide participants with an updated SPD or SMM?

  • Make sure that individuals handling plan funds or other plan property have a fidelity bond.

Your responsibility as a plan fiduciary is not one to be taken lightly. The consequences for both you and your employees are serious. If any of the matters above provide you with a reason for concern, please let us know. We can offer you advice and additional resources so that you can make sure that you are helping your employees save for their retirement.
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