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What improvements were made in the 2003 Form 5500 instructions regarding

reporting of delinquent participant contributions?

The Department received comments that these reporting rules required many plans to include

essentially the same information regarding delinquent participant contributions on Line 4a,

Line 4d and Schedule G. Accordingly, in order to avoid unnecessary, duplicative reporting, the

Department improved the requirements beginning with the 2003 Form 5500.

Beginning with the 2003 Form 5500, information on delinquent participant contributions

reported on Line 4a is no longer also reported on Line 4d or Schedule G. This will simplify

reporting of information on delinquent participant contributions. It does not, however, change

the fact that all delinquent participant contributions required to be reported on Line 4a, except

those for which the DOL VFCP requirements have been met and the conditions of PTE 2002-

51 have been satisfied, are nonexempt prohibited transactions.

Does this require IQPAs to change the way they audit delinquent participant

contributions?

No. In the case of employee benefit plans subject to an annual audit requirement under

ERISA, an independent qualified public accountant (IQPA) conducts an audit of the plan in

accordance with generally accepted auditing standards (GAAS) for purposes of rendering an

opinion on whether the plan’s financial statements are presented fairly in conformity with

generally accepted accounting principles (GAAP). The supplemental schedules referenced in

ERISA section 103(a)(3)(A) and 29 CFR §§ 2520.103-1(b) and 2520.103-2(b), including

information regarding nonexempt prohibited transactions, are also subject to the IQPA’s

auditing procedures applied in the audit of the plan’s basic financial statements, and the IQPA

expresses an opinion on whether the scheduled information is presented fairly in all material

respects in relation to the basic financial statements taken as a whole. The IQPA’s audit report

and opinion is made part of the plan's annual report as required by section 103(a)(1)(A) of

ERISA.

The 2003 Form 5500 instructions state that delinquent participant contributions reported on

Line 4a should be treated as part of the supplemental schedules for purposes of reporting on

the plan’s financial statements by the IQPA. The instructions also advise that if the

information contained on Line 4a is not presented in accordance with the Department’s

regulatory requirements, the IQPA report must make the appropriate disclosures in

accordance with GAAS.

These instructions were not intended to change or reduce the IQPA audit and reporting

responsibilities. Rather, the cautions were provided to make certain that the plan continues to

include delinquent participant contributions in its financial statements and supplemental

Faqs About Reporting Delinquent Participant Contributions On The Form 5500 - U.s. Department Of Labor Page 2