There is a strike against technology savvy TPAs

I have been working as an ERISA attorney since 1998. While the laws, regulations, and technology have changed, the government random audit has not. Sure, we can fax and email the agent with information and the audition-site visits are less frequent, but the parameters are the same.

When reviewing a plan for a particular year, the agent will have a checklist of what the need to review. It could be plan loans, compliance testing, and plan documents. The problem is that there are very technology-driven third-party administrators (TPAs) that can’t provide what a government agent could need. Something like an annual valuation report which shows compliance testing and a participant account balance is a report that some of these TPAs have a tough time generating and it doesn’t help when they have plan administrators that don’t understand what an agent wants. Even something like loans, may offer no promissory notes, which provides no security for a default.

Technology makes things easier, but a lot of times it makes things difficult for an audit.

Story Page
%d bloggers like this: