Media Center

New filing requirements for 403b plans:

Beginning with the 2009 Form 5500 filings, employee benefit plans under section 403(b) of the Internal Revenue Code that are sponsored by charitable organizations and covered under the Employee Retirement Income Security Act of 1974 (ERISA) will be subject to the same reporting and audit requirements that currently exist for 401(k) plans. These audited financial statements will be a required attachment to the plan's Form 5500. This requirement is applicable to commercial or not-for-profit organizations but not governmental or church organizations which are not generally subject to ERISA.403(b) plans with more than 100 eligible participants as of the beginning of the year will be subject to this new requirement.

Even though the new Form 5500 reporting and independent financial statement audit requirements are not effective until the 2009 Form 5500 filing, if your plan meets the requirement to have an independent audit for the plan year ended December 31, 2009, then the plan's financial statements will also need to include certain comparative financial information as of the 2008 plan year end. This comparative year information is required by the Department of Labor (DOL) to be included in the plan's financial statements, even in the initial reporting year. Required information includes the current value of plan investments, and the amounts of employer's contributions owed to the plan, accounts payable and accrued expenses as of the end of the plan year.

FAS 157 Implementation:

Employee benefit plans are now required to implement new accounting rules for valuing and reporting the fair value of their investments in the plan's financial statements. FAS 157 establishes a framework for measuring fair value under generally accepted accounting principles (GAAP), clarifies the definition of fair value within that framework, and expands financial statement disclosures about the use of fair value measurements. While employee benefit plans currently report plan investments at fair value in the financial statements, the FAS 157 framework for measuring fair value may change current valuation practices for certain investments and requires additional disclosures about the use of fair value. FAS 157 must be implemented for all plans that prepare GAAP financial statements, regardless of whether the plan administrator engages its independent auditor to perform a full scope or limited scope audit of those financial statements. FAS 157 applies for fiscal years beginning after November 15, 2007.

Sarbanes 404 deadline extended:

On October 2, the SEC announced the extension of Sarbanes 404(b) for non-accelerated filers for six months to June 15, 2010. Without the extension small companies would have been required to file their first auditors' report on internal control for fiscal years ending on or after Dec. 15, 2009.