Employee Benefit Plan (EBP) audit engagements remain under close examination by regulators and peer reviewers, stemming from a historical pattern of noncompliance with applicable professional standards. It is imperative that auditors possess the requisite skills to carry out EBP engagements with proficiency. This involves navigating the audit process from the initial engagement acceptance through to reporting and completion. Given that 401(k) plans represent the predominant plan type subjected to audits, we engage in a comprehensive examination of these plans. Discover strategies to meticulously plan and execute risk-based plan audits, ensuring adherence to professional standards without compromising on efficiency.
Learning Objectives
- Recognize key terms and definitions related to ERISA plans.
- Identify the different types of employee benefit plans (EBPs).
- Recognize operational and compliance elements of ERISA plans.
- Identify the basic financial statements for all ERISA plans.
- Recognize differences between GAAP and ERISA reporting.
- Identify the risks of material misstatement related to financial statement line items on the statements of net assets available for benefits.
- Recognize audit procedures commonly performed in a defined contribution retirement plan (DC plan) audit, including notes receivable from plan participants.
- Identify audit requirements when using the work of a specialist.
Major Topics
- GAAP vs. ERISA reporting requirements
- Audit planning
- Risk assessment, including consideration of internal control
- Auditing the statement of net assets available for benefits
- Auditing the statement of changes in net assets available for benefits
- Other auditing considerations, including prohibited transactions and tax compliance
- The auditor’s report
- Financial statement disclosures
- Supplemental schedules
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