10 ‘Fiduciary’ Questions For Employers

As an employer it is extremely important to understand your ‘fiduciary’ responsibilities for the benefit of the company’s retirement plan and stay in compliance with the law. Here are some questions to answer that will help you identify areas that may be of concern:

  1. Who are the ‘fiduciaries’ of the company’s 401(k) plans?

  2. Are the plan ‘fiduciaries’ aware of their responsibilities?

  3. Who chooses and reviews the investment options of the plan?

  4. Do plan participants have the education available to them in making informed investment?

  5. What assistance and information do the participants of the plan have to help them make investment decisions?

  6. How many service providers are invited to bid on the plan each?

  7. How do the ‘fiduciaries’ decide on whom to hire and why?

  8. Are the ‘fiduciaries’ monitoring the plans service providers?

  9. When the last time the company’s plan document was reviewed and/or updated?

  10. Do the individuals handling the plan have a fidelity bond?

Employers that are not able to answer these basic plan questions should consider hiring a compliance consultant that has experience with the DOL and ERISA rules and regulations. An ERISA compliance consultant can review each of the above questions and much, much more. Most importantly, a compliance consulting firm can assist you with implementing a structure to vet, hire and monitor both service providers & investment options. If it has been over 2 years since you reviewed your plan, hiring a compliance consultant to review your existing plan makes a lot of sense.

A compliance consultant can review the following:

  • ‘Fiduciary’ Risk & Liability exposure
  • Hiring & Monitoring Service Providers (TPA, IA & Custodian)
  • Summary Plan Description (SPD)
  • Fee Comparison
  • Investment Options and Education
  • Reporting Responsibilities
  • Employee/Employer Contributions
  • Plan Policies & Procedures
  • Prohibited Transactions
  • Employer Stock
  • Exemptions
  • Bonding

A company retirement plan compliance review is money well spent, as the review often pays for itself multiple times over. A compliance review will uncover potential Dept of Labor & ERISA violations. A compliance company like Aurora Compliance Solutions has the ‘knowledge’ and ‘the know how’ to assist you by limiting your risk exposure, increase service levels and reduce overall costs of the plan for both the employer & the Employee. Aurora Compliance Solutions is available to discuss your specific situation.


Written by: Edward Romanowsky, President and CEO of Aurora Compliance Solutions