Fiduciary Best Practices
Self Assessment
Maintain Written Plan Documents
Plan is established pursuant to a written instrument and is periodically updated as required on a timely basis.
Plan provides procedure for amendments and identifies persons with the authority to do so.
Rules and responsibilites of all involved parties (fiduciaries and non-fiduciaries) defined, documented, and acknowledged.
Bond secured to protect the plan against loss by reason of acts of fraud or dishonesty by plan official.
Summary Plan Description (SPD) provided to new participants within 90 days after entering the plan.
SPD updated for plan changes and distributed to participants within 210 days following the plan year in which the plan was amended.
Process In Place to Assess Service Provider Qualifications
Service agreements and contracts in writing.
Periodically verify quality of service offered and qualifications of the professionals offering services.
Obtain description of provider business practices.
Periodically benchmark fees to verify reasonableness.
Periodically benchmark services provided to ensure they meet industry standards and plan objectives.
Investigate suspicious activity.
Maintain Records for at Least Six Years
Records provide sufficient detail to verify, explain, clarify, or check for accuracy and completeness.
Records available for examination by DOL or IRS.
Records maintained in a fiduciary file with sufficient detail to verify fiduciary due diligence is being completed as defined in the IPS and in a timely manner.
Employment records maintained to sufficiently determine eligibility and current beneficiary information.
Reasonable search conducted to pay out benefits to former or missing participants.
Investment Selection and Monitoring
Investment time horizon, risk level, and expected,modeled return to meet investment objectives identified.
Selected asset classes consistent with the identified risk, return, and time horizon.
Investment Policy Statement (IPS) which contains the detail to define, implement, and manage a specific investment strategy.
Investment vehicles appropriate for the portfolio size.
Periodic reports comparing investment performance against an appropriate index, peer group, and IPS objectives.
Periodically benchmark fees to verify reasonableness.
Ensure Plan Maintains Qualified Status
Determine eligibility and enroll employees appropriately.
Collect contributions according to participant elections and remit on a timely basis.
Administer plan's loan program.
Perform necessary nondiscrimination testing.
Appropriate and thorough employee education program in place.
Fiduciaries Do Not Engage in Prohibited Transactions
Plan does not sell or exchange property, extend credit, or lease property to a party-in-interest, nor does any party-in-interest sell or exchange property, extend credit, or least property to the plan.
Trust income or assets are not transferred to, or used by or for the benefit of a party-in-interest.
Fiduciaries do not deal with the income or assets of the plan in their own interest, or receive consideration from a party-in-interest dealing with plan fiduciaries.
Reporting and Disclosure
Plan follows ERISA reporting requirements (Form 5500).
Participants, beneficiaries receive Summary Annual Report (SAR) and benefit statement.
Prior notice provided to participants taking distributions (explanation of benefit options, rollover, and withholding rules).
Annual notices furnished regarding certain plan features (e.g. 404(c), QDIA, Safe Harbor).
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