ABA Provides Feedback to ERISA Advisory Council on Improving Financial Statement Audit Process

The American Bankers Association today provided feedback to the ERISA Advisory Council (which reports to the Department of Labor) on the role of plan administrators and sponsors with respect to plan audits—including those performed under a limited scope audit engagement in which a bank custodian certifies the completeness and accuracy of investment information of plan assets held by the bank. The letter comes as the council prepares to review and recommend improvements to the financial statement audit process.

ABA urged the council to recommend that DOL clarify that obtaining a certified statement from the bank custodian as part of the limited scope audit is not intended to replace (or substitute for) a plan’s responsibility to secure the performance of the fair valuation measurement and other analyses required under DOL’s Form 5500 instructions and generally accepted accounting principles. The association also recommended the creation of educational materials to better equip plan sponsors and administrators to understand their fiduciary responsibilities when participating in the plan audit process.