DOL: “Audit Deficiencies Putting Plans and Participants at Risk”
The US Department of Labor recently released a report “Assessing the Quality of Employee Benefit Plan Audits.” In the report the EBSA (Employee Benefits Security Administration) revealed “serious issues with the current system.”
According to Phyllis C. Borzi Assistant Secretary of Labor for Employee Benefits Security “The existing patchwork of regulations and rules need to be overhauled and a meaningful enforcement mechanism needs to be created.” She went on to say “the department is proposing, among other measures, legislation that will fix these problems.”
There were 81,000 employee benefit plan audits conducted nationwide by more than 7,300 licensed CPAs. “The EBSA’s review found that 61 percent of the audits fully complied with professional auditing standards or had only minor deficiencies under professional standards. The remaining 39 percent of the audits contained major deficiencies, however, which put $653 billion and 22.5 million plan participants and beneficiaries at risk.”
Documentation errors and missing information still are some of the most common issues employers are facing during a DOL audit. There is so much documentation required and to keep track of, it’s very easy to misplace one or not have it all documentation concisely organized. The Affordable Care Act (ACA) has just furthered complicated matters by requiring even more documentation.
It is no longer if an employer will receive a notice of a DOL health plan audit but when. DOL health plan audits can be time consuming and very costly to an employer. At Van Beurden Insurance we recommend having a system and process in place today to address the audit before it becomes a bigger issue. We engage our clients in a risk assessment process to uncover any potential issues that could arise during a DOL audit. Please feel free to reach out if you would like to participate in our risk assessment process.
To access the full report click here