August 6, 2012 (PLANSPONSOR.com) – Provider fee disclosures can be a useful tool for retirement plan sponsors, according to a new report.
DCAdvisors argues the new service provider fee disclosures give retirement plans a valuable tool to match fee structure and service provider relationships to industry best practices while benchmarking fees to determine reasonableness.
A white paper, entitled “New Disclosure Requirements Pull Back the Curtain on Retirement Plan Fees,” describes a methodical five-step approach retirement plan committees can follow and mitigate fiduciary risk:
- ensure timely receipt of fee disclosures;
- examine fee disclosures for completeness, comprehensiveness and clarity;
- determine reasonableness of fees;
- evaluate and implement appropriate changes in fee structure or service relationships; and
- examine implications for plan governance.
“What plan sponsors and their retirement committees do with these new insights will be carefully watched by the DOL," said Dan Esch, managing director of DCAdvisors. "An inadequate response could lead to financial penalties or even threaten the qualified status of the retirement plan itself.”The white paper is here.