The Employee Retirement Income Security Act (ERISA) deadline may have passed, but for plan sponsors and fiduciaries, the work is far from over.
The period immediately following the deadline is a critical time to reflect, correct, and prepare. Here’s how companies can use this window to strengthen their regulatory compliance and ensure a smoother process next year.
1. Conduct a Post-Filing Review
After submitting Form 5500 and other required disclosures, plan sponsors should perform a retrospective review of the plan year. This includes:
- Verifying that all required notices (e.g., Summary Annual Reports, fee disclosures) were issued on time.
- Ensuring that participant communications were clear and documented.
- Reviewing any audit findings or internal inspection results for improvement opportunities.
2. Address Operational Errors Promptly
If any compliance issues were discovered—such as missed contributions, incorrect participant data, or outdated plan documents—plan administrators should act quickly. The IRS’s Voluntary Correction Program (VCP) offers a structured way to correct significant failures, such as missing contributions or not properly enrolling an employee into the plan. Consulting an ERISA attorney or third-party administrator (TPA) is highly recommended to navigate these corrections.
3. Update Documentation and Plan Amendments
Plan administrators should ensure that all plan amendments, Summary Plan Descriptions (SPDs), and Summaries of Material Modifications (SMMs) are current and accurately reflect the plan’s operations. Any changes made during the year must be documented and disclosed within the required timeframes.
4. Evaluate Internal Controls
Internal control narratives for key plan processes should be regularly reviewed by plan administration to ensure they are up to date and accurately reflect the controls in place. In addition, plan management should identify areas for improvement. If applicable, Management Letter Comments (MLCs) and reportable findings should be reviewed and discussed with the audit team upon the conclusion of the audit. MLCs and reportable findings can vary in severity; however, the auditors can communicate any they believe will lead to process improvements for the plan.
Each TPA will have a SOC report prepared annually identifying key controls for each process of the plan. Plan management should identify which controls are applicable to them, then review the associated Complementary User Entity Controls (CUECs) associated with each. CUECs are controls that must be performed by the plan in order for the key control of the TPA to operate effectively.
5. Plan Ahead for Next Year
To avoid the 10/15 stress, rush and late-filing penalties, plan management should be in communication with their audit teams throughout the year, keeping them up to date on major plan changes that will affect the scope of the audit. Common key events include plan mergers, changes in TPAs, newly eligible employee groups and other significant changes. Allowing the auditors to get ahead of these changes will lead to a smoother audit.
While meeting the ERISA deadline is a significant milestone, true success comes from what happens next. By conducting thorough post-filing reviews, promptly addressing any operational errors, keeping documentation up to date, and strengthening internal controls, plan sponsors and fiduciaries can turn compliance into an ongoing process of improvement. Proactive planning and open communication with audit teams throughout the year will not only reduce stress and risk but also set the stage for a smoother, more efficient filing season next year.
For more information on how you can prepare for your next ERISA deadline, contact a member of the Schneider Downs Employee Benefit Plan team.
