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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