Many EBPs use third-party administrators or service organizations in their processing oftransactions. Auditors often use SOC 1 reports from third-party vendors to gain an understanding of the operations and internal controls of the plans' third-party vendors. SOC 1 reports must be fully reviewed and evaluated by the EBP auditor, with an eye toward .
Coordination in EBP audits can be complicated because the auditor is working with various personnel with the plan sponsor, and external vendors or third-party administrators to get information and data. Auditors will be working with human resources personnel as well as the finance and accounting personnel who traditionally provide information durin.
Proper tone at the top means a commitment to performing the engagement correctly. In the case of an EBP audit, this means getting the appropriate training, providing proper supervision and review, assigning qualified staff with experience, and obtaining the proper resources to do the jobright. "It involves a substantial financial commitment," said .
Many firms that perform more than just a few EBP audits have auditors or teams of auditors who specialize in EBP audits (see "Succeeding With a Narrow Focus," page 56). "If you've got a dedicated team that really understands this area, you can really get efficient," Tveitsaid. Some firms even have teams that specialize in particular areas of EBP au.
After developing a written firm quality-control document, it's critically important for auditors to pay close attention to how the quality-control principles are applied in their EBP auditpractice. In addition, EBPAQC member firms are required to perform an annual inspection of a representative sample of their EBP audits. Firms may use these review.
The most common areas for deficiencies identified in the DOL report were EBP-specific requirements such as testing contributions, benefit payments, participant data, and party-in-interest/prohibitedtransactions. Lajoie said thorough testing is essential for auditing success in these areas. For example, comprehensive testing should be done on a samp.
The DOL has recommended that Congress amend the Employee Retirement Income Security Act (ERISA) to repeal the limited-scope audit exemption, which has caused confusion for auditors of EBPs. The AICPA supports repeal of the limited-scope auditexemption. The exemption allows the plan administrator to instruct the auditor not to perform any auditing p.
With EBP audit results in hand, you’ll be able to more accurately evaluate the strengths (or weaknesses) of the internal controls involved in financial reporting
The conclusion of the EBP audit reinforces that your plan will have the funds available to pay benefits to respective participants when these benefits become due
In any EBP audit, documentation demonstrates an understanding of the entity and the plan, with descriptions of the type of plan, the plan’s design, who’s covered, who’s not covered, and any special requirements that the auditor needed to keep in mind throughout the engagement
Enter: ,employee benefit plan audits
audit of an employee benefit plan (EBP) involves the examination of financial statements provided by a third party to the DOL, plan management and plan participantsGoing through an EBP audit can be a daunting process, especially if you’re going through the process for the first time
Coordination in EBP audits can be complicated because the auditor is working with various personnel with the plan sponsor, and external vendors or third - party administrators to get information and data
A lack of "healthy paranoia" can be one of the biggest problems in approaching employee benefit plan (EBP) audits, said Bertha Minnihan, CPA
An EBP audit at first may seem straightforward and simple, so auditors may let down their guard or attempt to perform an audit without the specialized training they need to do the job
Proper tone at the top means a commitment to performing the engagement correctly
In the case of an EBP audit, this means getting the appropriate training, providing proper supervision and review, assigning qualified staff with experience, and obtaining the proper resources to do the job right
An EBP audit at first may seem straightforward and simple, so auditors may let down their guard or attempt to perform an audit without the specialized training they need to do the job
If practitioners are not careful, they may find that an EBP audit is like a cute little dog that has a surprisingly nasty bite
