What Are Retirement Plan Documents?

By Anthony Bianchi, Supervisor and Louis F. LiBrandi, Principal

The purpose of this article is to provide information as to the designated term “plan documents” as it used in many legal and statutory situations and as frequently requested by auditors performing a financial statement review, regulatory examination, during an RFP process, due diligence, etc.

Specific Plan Documents

Characteristically, the term refers to all or some of the following materials:

• Adoption Agreement
• Basic Plan Document
• Trust Document
• Summary Plan Description (SPD)

These documents comprise the rules and regulations governing the plan. The wording of the plan provisions is referred to as the “form” of the plan. Most types of plans ‒ whether individually-designed or more commonplace ‒ a prototype plan is issued a determination/opinion or advisory letter from the IRS who has reviewed the plan documents submitted to them by the plan document preparer. Many times that is the plan’s record keeper.

Caution

In our recent representation of retirement plan examinations, we have encountered many plan documents and amendments that are not executed/signed or, in a few situations, not available. When the plan is being examined by the IRS, documents and amendments that are not executed or cannot be produced will likely result in the examination being processed by a closing agreement. A closing agreement requires correction (i.e., appropriate plan documents being secured, and contemporaneously signed) as well as a negotiated sanction payment made to the IRS.

Monitoring Plan Documents

Plan documents need to be periodically updated. (See the article, Defined Contribution Plan Restatements Must Be Completed by July 31, 2022.) A best practice is for all the plan documents to be maintained by the plan sponsor in one separate file (frequently referred to as a “fiduciary file”) and reviewed annually.

Contact Us

The Employee Benefit Services Group at PKF O’Connor Davies is available to assist employers with all aspects of employee benefit plan compliance. For more information, please email Tim Desmond at tdesmond@pkfod.com or Louis F. LiBrandi at llibrandi@pkfod.com.