No More Reporting Relief for 403(b)s?

July 19, 2011 ( – In a live Web chat with Phyllis Borzi, Assistant Secretary of Labor for the U.S. Department of Labor’s Employee Benefits Security Administration, an attendee asked: “Will there be any more reporting relief for 403(b) plans?”

Borzi’s response indicated the answer is “no.”  

Borzi noted that the Department responded to many of the audit concerns raised by the regulated community by issuing FAB 2009-02 (see DoL Provides Relief on Form 5500 Reporting for 403(b) Plans), which granted transition relief from the annual reporting requirements for certain pre-2009 contracts held in 403(b) plans. In the guidance, the Department also stated that it understood 403(b) plans may encounter compliance issues unrelated to pre-2009 contracts in making the transition to the Form 5500 annual reporting and audit requirements generally applicable to other Title I pension plans.   

Acknowledging that there may be instances when full annual reporting compliance by 403(b) plans may not be possible for the 2009 plan year, the Department stated that the guiding principle must be to ensure that appropriate efforts are made to act reasonably, prudently, and in the interest of the plan’s participants and beneficiaries.   

“The Department continues to believe that subjecting the financial statements and operations of a 403(b) plan to the scrutiny of an audit has inherent value and that subjecting ERISA-covered 403(b) plans to the same annual reporting rules that apply to other ERISA-covered pension plans is consistent with the purposes of Title I of ERISA and the interests of covered participants and beneficiaries,” Borzi wrote.