As a business grows, the regulatory burdens covering it increase in size and scope as well. One of the most critical of these – that can easily be overlooked by a recent startup that’s growing rapidly – is the requirement for employee benefit plan audits under the Employee Retirement Income Security Act (ERISA).
HSRDS accounting and tax services offers full auditing services, conducted under the strictest quality standards. With HSRDS on your side, you can easily clear this regulatory hurdle.
Understanding Employee Benefit Plan Audits
Simply put, if your organization has 100+ employees enrolled in a company benefits plan, you are required by the US Department of Labor to regularly audit that benefit plan to demonstrate full financial responsibility and compliance. This audit must accompany the Form 5500 filed as part of your annual taxes.
Simplified, this audit must at least show:
- Employee contributions to the plan are being transmitted in a timely fashion.
- All books must balance with full contributions accounted for.
- An accurate census of demographic data from all contributors.
- Full documentation of hardship withdrawals and other unusual circumstances.
Unfortunately, this is a burden that many companies either overlook entirely, or else do not fulfill within the requirements set down by law. A recent DOL survey concluded that almost forty percent of audits conducted were deficient or unacceptable in some way.
This can be a major problem, and not just to the company itself. Under ERISA regulations, a company not in compliance can face civil litigation, with potential penalties of up to $1,100 per day without limitation. Further, hiring a competent auditor is considered a fiduciary duty of an organization’s CFO or other chief officers. In a worst-case scenario, they could face personal liability due to a failure to comply.
If your organization is in a situation where these ERISA regulations apply, you need accounting and tax services capable of handling this auditing burden.
Excellence in Auditing From HSDRC
HSDRC has pulled together experts from across the Covina area to offer unparalleled accounting and tax services. We are members of the American Institute of CPAs Employee Benefit Plan Audit Quality Center, which maintains the strictest standards in the country on benefit plan audits.
With HSDRC by your side, you can be sure that your ERISA audits will be conducted properly and in full compliance with the law. Contact the team at HSDRC today for more information.