401(k) Audits

A 401(K) plan is a retirement savings plan offered by some employers in the United States. Contributions to a 401(k) are deferred from an employee’s paycheck pre-taxation. The contributions are then invested into the company’s 401(K) which is handled by a third party administrator. The third party administrator invests the money into mutual funds, bonds and money market accounts that the employee selects.

The IRS and Department of Labor have recently increased government regulations on 401(k) plans offered by employers. The rules are now extremely stringent and non-compliance can cost companies large amounts of money.

When a company contains more than 120 employees who participate in the 401(k) plan they are required to have an annual compliance audit of financial statements that accompany the Form 5500. Form 5500 is required by the Department of Labor to be sent in annually for pension and benefit plans. Companies that start new 401(k) plans containing 100 or more participants are required to have an audit conducted.

401(k) audits play an important role in proving that the plans are under proper management and funds of employees are being properly invested. If the employer offers any form of matching, monitoring to make sure funds are matched properly will also take place.

At AgeeFisherBarrett, LLC we know how vital it is to understand the audit requirements and latest developments effecting them. To find out if your company is required to have a 401(k) audit or for more information regarding audits of 401(k)’s please contact us and speak to a member of our Audit Team.

 AgeeFisherBarrett, LLC is a member of:
AICPA, PCAOB, GSCPA, LISA, ISACA , SOFE

For a free consultation call (404) 250-4570