A Fortune 500 home improvement company became concerned with the accuracy of a record keeping vendor’s 401(k) transactional processing. Recent participant-related complaints gave the client reason to believe that there might be more serious systematic process failures related to the day-to-day plan processing.
The client was seeking an independent, objective analysis of these processes to determine the extent of the issues and to recommend the best course of action if issues were found.
SBA delivered the following scope of services:
- Worked with the client to develop a meaningful audit scope that initially addressed “big ticket items” that are known to be a struggle for record keepers
- Developed audit and test plans for transactions including loans, vesting determination, forfeitures, distributions, minimum required distributions, payroll processing, and clearing account reconciliation
- Obtained access to the record keeper’s systems and executed audit plan
- Documented audit results and worked with client and ERISA counsel to categorize severity of issues
- Worked with record keeper to identify root causes of the identified issues
- Directed process and programming changes as well as the implementation and testing of the changes
Several problematic transactional areas were identified and corrected as part of this project. Some errors which could have compounded into major compliance problems over time were identified and fixed as well.
Processes were put in place by the record keeper to ensure the issue would not occur again. Additionally, reports were created to assist the client in identifying new issues and managing the record keeper on an on-going basis.
