Employee Benefit Plan Audit Quality Center 2023

EBPAQC Designated Audit
Quality Partner audit planning—
2023
Employee Benefit Plan
Audit Quality Center
AICPA
Michael Auerbach, DOL EBSA
Debbie Smith, Grant Thornton LLP
Josie Hammond, RSM US LLP
Sandi Carrier, Deloitte
Presenters
Today’s topics
 
DOL update
Legislative, regulatory and industry developments
2022 audit season observations/what to expect in 2023
New auditing standards
Other audit considerations and resources
EBPAQC resources
Q&A session
Handouts for today’s event
You can download presentation slides (in PDF or PowerPoint format)
and other handouts by clicking on         in the toolbar at the bottom of
your screen
Instructions to obtain your CPE certificate for today’s event
Webcast presentation slides
EBPAQC primers:
Actuarial methods and assumptions used in measuring plan benefit obligations in
health and welfare benefit plans
Timely remittance of employee contributions in defined contribution retirement plans
 
EBPAQC tools:
2023 Special Considerations for EBP audits
Firm preparedness checklist for EBP audits
Employee benefit plan audit engagement acceptance and continuance
considerations
Analyzing timeliness of remittances
Form 5500 considerations for auditors
DOL AICPA independence rule comparison (updated)
 
 
 
 
 
DOL update
Changes at EBSA
 
 
Lisa M. Gomez was confirmed and sworn in as the new Assistant
Secretary on October 11, 2022
Who are you performing the audit for?
 
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DOL updated guidance on independence
The Department updated its interpretive bulletin on independence of
IQPAs
IB 2022-01 issued on September 2, 2022
Revises and restates the interpretative bulletin 29 CFR 2509-
75.9, dating back to 1975 t
o remove certain outdated and
unnecessarily restrictive provisions and to reorganize other
provisions for clarity.
Ability for a member to divest of publicly-traded securities held
during the period being audited if certain conditions exist
Guidance may be found at:
https://www.dol.gov/newsroom/releases/ebsa/ebsa20220902
 
 
Cybersecurity
The Department issued guidance on this in April 2021
https://www.dol.gov/newsroom/releases/ebsa/ebsa20210414
Guidance comes in three parts
Tips for Hiring a Service Provider
Cybersecurity Best Practices
Online Security Tips
Review your service provider’ cybersecurity practices
Review your plan’s cybersecurity prctices
2022 Form 5500 changes
 
Improvements in reporting on the actuarial and retirement plan schedules
(Schedules MB, SB, and R) filed by defined benefit pension plans.
Limited number of instruction changes focus on reporting for multiple-
employer pension plans (including pooled employer plans).
Technical changes that are part of the annual rollover of the Form 5500 and
Form 5500-SF forms and instructions.
Changes to the plan characteristics codes reported on line 8 of Form 5500,
and on line 9 of Form 5500-SF, to improve the data reported on defined
contribution multiple employer plans, including pooled employer plans.
The instructions also contain clarifying additions related to Part II of Form
5500 and Form 5500-SF that collect plan sponsor and plan administrator
information.
 
Reporting compliance enforcement activities
 
Missing IQPA Reports
Large plan filers
Section 104-50 deferred audits
Late Filers/Non-Filers/Stop Filers
Delinquent Filer Voluntary Compliance (DFVC) Program Integrity
Form 5500-SF Eligibility
Pay attention to DOL enforcement letters
 
Inquiry Letter
Notice of Rejection (NOR)
Notice of Intent to Assess a Penalty Letter (NOI)
Notice of Determination Letter (NOD)
Administrative Law Appeal
 
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If the Plan Administrator does not respond timely and properly to the
NOI Letter
NOD Letter
The penalty assessment becomes final, and the case is sent to
Treasury for collection of penalty
ERISA plan audit universe
 
 
86,800 plan audits
4,300 CPA Firms
$11 Trillion in Plan Assets
133.2 million participants
DOL audit quality study
Based on plan year 2020 Form 5500 filings
Statistically based
To entire population
Five Strata
“Non-complex” and “complex plans”
Demographic questionnaire
Workpaper reviews completed
Data crunching and analysis
 
 
Ongoing audit quality activities
 
Complete Audit Quality Study
Workpaper reviews of firms with audit practices less than 100 EBP
audits
Firm Inspections of firms with > 200 EBP audits
Continued participation in outreach with state CPA societies and
other stakeholder organizations
Continued participation with AICPA Ethics, Peer Review, and Quality
Center groups
Pooled plan providers and PEPs
 
118 = Pooled Plan Providers that had filed an initial Form PR
Pooled Plan Provider Registration (Form PR)
293 = PEPs were registered with the Department
PEP audits
 
 
 
(as of October 31, 2022)
DOL resources
www.dol.gov/ebsa
For DOL publications, FAQs, copies of the Form 5500, instructions,
and related schedules
EBSA Office of the Chief Accountant  
202-693-8360
EBSA Office of Regulations and Interpretations 
202-693-8500
For questions about ERISA reporting, filing or other regulatory
requirements
DOL EFAST Help Center  
1-866-463-3278
For questions regarding the Form 5500 or related schedules
Legislative, regulatory and industry
developments
DOL proposed changes
VFCP self-correction
DOL proposed adding a self-correction component to its Voluntary
Fiduciary Correction Program (VFCP)
Expands types of transactions covered under VFCP and simplifies the
administrative tasks necessary to receive relief
Conditions for self correction of delinquent contributions and loan
repayments
C
orrection to take place within 180 days from the date of withholding or
receipt
Lost earnings can not exceed $1,000
Self-correcting plans would be required to
Use program’s online calculator to determine lost earnings
Use online portal to file a notice of the correction with DOL
Complete and retain the self-correction retention record checklist
 
Proposal released
in November
2022.
 
Written comments
due on or before
January 20, 2023.
 
DO will notify the
public of the
availability of the
amended and
restated VFC
Program in a
subsequent
Federal Register
document.
DOL proposed changes (continued)
Prohibited transaction exemption
DOL also proposed a separate rule that would amend 
P
rohibited
Transaction 
C
lass 
E
xemption (PTE) 2002-51
T
o allow an employer to obtain excise tax relief for self-corrected
late contributions meeting certain conditions
S
elf-correcting plans would notify the DOL that a correction has
taken place via an online portal (eliminating the need for a formal
application and no-action letter)
Would eliminate a cap on the total number of similar voluntary
corrections the agency will process for a single plan
Employer-sponsored plans currently only allowed to apply for one
such voluntary correction every three years
 
 
403(b) plans: determination letters
IRS Revenue Procedure 2022-40
IRS will provide determination and termination letters to 403(b) plans
beginning June 2023
Sponsors of individually designed 403(b) plans may request a
determination letter for a new plan or for terminating a plan using the
same program currently used by 401(k) plans and other plans
qualified under Section 401(a)
Sponsors with an EIN ending in
1, 2, or 3 may begin requesting determination letters starting June 1,
2023
4, 5, 6, or 7 must wait until June 1, 2024
8, 9, or 0 must wait until June 1, 2025
Terminating 403(b) plans may request a plan termination letter without
regard for EIN beginning June 1, 2023
Rev. Proc. 2022-40
released November 7,
2022.
SECURE 2.0 Act of 2022
Contains 
sweeping changes relating to qualified retirement plans
aimed at
Increasing retirement savings
Simplifying and clarifying retirement plan rules
Other purposes
 
Plan amendments generally need not be made until the end of the
first plan year beginning on or after January 1, 2025
 
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Passed by Congress
on December 23,
2022.
 
Signed into law by
President Biden on
December 29, 2022.
Auto enrollment/auto-escalation
SECURE 2.0
New 401(k) and 403(b) plans must automatically enroll participants
when they become eligible (employees may opt out of coverage)
Initial rate of at least 3% but not more than 10%
each year thereafter amount is increased by 1% until it reaches at
least 10% but not more than 15%
 
Exemptions:
All existing 401(k) and 403(b) plans in effect on the date of enactment
Small businesses with 10 or fewer employees
New businesses (i.e., those that have been in business for less than
three years)
Church plans
Governmental plans
Section 101
 
E
ffective for plan years
beginning after
December 31, 2024.
Changes to the Saver’s Credit
SECURE 2.0
SECURE 2.0 repeals and replaces the Saver’s Credit
Current law allows for a nonrefundable “Saver’s Credit” for certain
individuals who make contributions to IRAs and employer retirement
plans
The credit currently paid in cash as part of a tax refund changes to a
federal matching contribution that must be deposited into a
taxpayer’s IRA or retirement plan
The amount of the match is 50% of retirement plan contributions, up to
$2,000 per individual, and is subject to an income-based phase out
Sections 103 and 104
 
Effective for taxable
years beginning after
December 31, 2026.
Changes to long-term, part-time employees
SECURE 2.0
SECURE 2.0 includes changes related to long-term, part-time
employees:
Modifies the measuring period for long-term, part-time employees
from three years to two years
Extends the long-term, part-time employee provision to 403(b) plans
that are subject to ERISA
Clarification: Pre-2021 service also disregarded for purposes of the
vesting of employer contributions (and pre-2023 service is disregarded
for eligibility and vesting purposes under the new SECURE 2.0 part-
time employee provision)
Section 125
 
E
ffective for plan
years beginning after
December 31, 2024.
 
 
The clarification is
effective as if included
in the 2019 SECURE
Act, so effective
beginning after
December 31, 2020.
 
Required minimum distributions (RMD) and catch-up contributions
SECURE 2.0
RMDs
:
Section 107- Increases to the RMD
 age to:
73 for a person who attains age 73 before January 1, 2023
75 for a person who attains age 74 after 
January 1, 2032
Section 325- Starting in 2024, Roth accounts will be exempt from the
RMD rules while the participant is alive
Catch-up contributions
:
Section 109- I
ncreases the limit on catch-up contributions for individuals
ages 60 to 63 to the greater of (i) $10,000 or (ii) 150% of the regular
catch-up amount for 2024 (amounts to be adjusted annually based on
the cost of living)
Section 603- S
tarting in 2024, all catch-up contributions must be Roth
contributions for participants with compensation equal to or in excess of
$145,000 (indexed for inflation)
 
 
 
 
Section 107- RMDs-–
Effective for
distributions made
after December 31,
2022, for individuals
who attain age 72 after
that date.
 
    ****
 
Section 109-Catch-up
contributions--
Effective for taxable
years beginning after
December 31, 2024.
 
Student loan payments
SECURE 2.0
Employers may make matching contributions under a 401(k) or 403(b)
plan on employees’ qualified student loan payments
“Qualified student loan payment” is defined as any indebtedness
incurred by the employee solely to pay qualified higher education
expenses of the employee
Employees who receive such matching contributions are required to
certify annually to the employer that such payment has been made on
such loan, and 
employer may rely on the employee certification of
payment
 
Note
: For purposes of the nondiscrimination rules, student loan payments
will 
not
 be treated as plan contributions, and a plan may separately test
the employees who receive matching contributions on student loan
payments in determining whether it satisfies the ADP testing requirements
for a given plan year
 
Section 110
 
E
ffective for plan
years beginning after
December 31, 2023.
Withdrawals for certain emergency expenses
SECURE 2.0
SECURE 2.0 Act provides an exception from the 10% tax on certain
early distributions:
Distributions must be 
used for emergency expenses which are
unforeseeable or immediate family needs relating to personal or family
emergency expense
One distribution, not to exceed $1,000, is permitted each year
Participant
 can repay the distribution within three years
N
o further emergency distributions are permissible during the three-year
repayment period, unless repayment occurs
Plan administrators generally may rely upon a participant’s self-certification;
however, the IRS is authorized to issue guidance to address situations in
which a plan administrator has actual knowledge to the contrary or there
are employee misrepresentations
Section 115
 
Effective for
distributions made
after December 31,
2023.
Increased dollar threshold for mandatory distributions
SECURE 2.0
Increases involuntary distribution limit from $5,000 to $7,000
 
 
Section 304
 
Effective for
distributions made
after December 31,
2023.
Pension linked emergency savings accounts (ESA)
SECURE 2.0
DC plans may include an ESA for non-highly compensated employees; accounts
are part of the plan document but accounted for separately
Employers may automatically opt their employees into these accounts at no more
than 3% of employee compensation
Employee contributions cannot exceed $2,500, or a lower dollar amount
determined by the employer (indexed for inflation)
Amounts in excess of the dollar cap can be contributed to a Roth DC plan, or
stopped until the amount drops below the dollar cap
All contributions are made on a Roth-like basis (after tax) and treated as elective
deferrals for purposes of matching contributions (annual match cap set at the
max account balance (i.e., $2,500 or lower as set by plan sponsor)
Participants may take monthly withdraws from their ESA, but the first four
withdrawals for a year cannot be subject to any fees charged solely on the basis
of such withdrawal
Upon separation from service, the employee can receive their ESA as cash or roll
it into their Roth DC plan (if they have one) or an IRA
 
 
 
 
Section 127
 
Effective for plan
years beginning after
December 31, 2023.
Recovery of retirement plan overpayments
SECURE 2.0
Gives retirement plan fiduciaries discretion to not recoup overpayments
mistakenly made to retirees
Fiduciary relief for failure to make the plan whole
For ERISA-covered plans where a plan’s fiduciaries choose to recoup
overpayments, limitations and safeguards apply:
Restrictions on the offset when a plan sponsor elects to offset future
plan payments to recover the overpayment
Restrictions on 
collection efforts from the participants (e.g., no interest,
must recover within three years)
Rollovers of the overpayments remain valid
 
 
 
 
Section 301
 
Effective upon
enactment with
certain retroactive
relief for prior good
faith interpretations of
existing guidance.
Compliance testing/corrections
SECURE 2.0
Employers may perform 
top-heavy plan testing
 separately for non-excludable
and excludable employees.
IRS 
Employee Plans Compliance Resolution System (EPCRS) 
expanded 
to:
Allow more types of errors to be rectified internally through self-correction
Exempt certain failures to make RMDs from the excise tax penalty
For ex, allows for the correction of many plan-loan errors through the self-
correction process
G
race period allowed to correct, without penalty, reasonable errors in
administering 
automatic enrollment and automatic escalation features
occurring after December 31, 2023-
Errors must be corrected within 9½ months after the end of the plan year in
which the mistakes were made
 
 
 
 
 
Section 310-
Top-heavy testing--
Effective for plan
years beginning after
December 31, 
2023.
 
 
Section 305- EPCRS
expansion-- Effective
upon enactment.
 
 
Section 350-
Automatic features--
Effective for any
errors after December
31, 2023.
 
403(b) plans
SECURE 2.0
C
onforms current 
hardship distribution 
rules for 401(k) plans to 403(b)
plans
Long-term, part-time employee 
provision extended to 403(b) plans
subject to ERISA
403(b) plans will now be allowed to invest in 
collective investment
trusts (CIT)
4
03(b) plans can join 
a multiple employer plan (MEP) or pooled
employer plan (PEP)
 
 
 
 
Section 602-
Hardships--
Effective for plan years
beginning after
December 31, 2023.
 
Section 125- LT/PT
employees-- Effective
for plan years
beginning after
December 31, 2024.
 
Section 128- CITs--
Effective for amounts
invested after date of
enactment.
 
Section 106-
MEPS/PEPS--
Effective for plan years
beginning after
December 31, 2022.
Annual audits for a group of plans
SECURE 2.0
C
larifies that 
each plan 
filing under a group of plans (added by the
SECURE Act) is required to submit audited financial statements if it
has 100 participants or more.
Plans with fewer than 100 participants that are included in a group of
plans are not required to submit audited financial statements.
 
 
Section 345
 
Effective upon
enactment.
Other
SECURE 2.0
Qualified birth and adoption distribution rules amended
Plans may distribute up to $2,500 per year to pay premiums for high-
quality long-term care insurance products (distributions exempt from
the 10% additional tax on early distributions).
Retirement plans may allow withdrawals of the lesser of $10,000,
indexed for inflation, or 50% of the participant’s account balance by
participants who have experienced domestic abuse
 
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Section 311-
Birth/Adoptions—
Effective for
distributions made
after the date of the
enactment. For prior
distributions, the
repayment period ends
December 31, 2025.
 
Section 334- LT Care
Insurance- - 
Effective
beginning with
distributions three
years after the date of
enactment.
 
Section 314- Domestic
abuse-- Effective for
distributions made
after December 31,
2023.
SECURE 2.0 of 2022…things to think about
Understand the sweeping changes 
impacting qualified retirement
plans
Changes have various effective dates
Will require significant adjustments for employers, participants and
their-party administrators
Extensive IRS and DOL guidance will be needed
May result in heavier administrative burdens and increased costs for
employers
Participants will need education on updates
Coordination of updates with payroll providers and third-party
administrators will be needed
 
 
 
 
 
 2022 audit season observations/what
to expect in 2023
2022 audit season observations/what to expect in 2023
Prepare for potential challenges:
Staffing and readiness (firm, client, TPA)
Reconciling balances
Year 2 auditor  reporting
Certified information disclosure
Form 5500 review considerations
Other
 
AU-C Section 703 (SAS 136) implementation challenges –
lessons learned
Consideration of relevant plan provisions in audit risk
assessment and response
Performance procedures for ERISA Section 103(a)(3)(C)
audits
Substantially complete Form 5500
Management representation letter
Auditor’s reports
Auditor’s communications, including reportable findings
 
Relevant plan provisions
Paragraph .20 of AU-C section 703 states:
.
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Relevant Plan Provisions FAQs (
Q&A Section 6933 
Auditing Employee
 
Benefit Plans
When is a plan provision considered “relevant”
Is the auditor required to test all plan provisions related to classes of
transactions, account balances and disclosures?
Is there a requirement to document the auditor’s consideration of every plan
provision, or to explicitly document whether and where plan provisions the
auditor identified for testing will be tested?
Could there be plan provisions that the auditor may want to test beyond
those identified as “relevant” based on risk assessment?
Year 1 vs year 2 unmodified ERISA Section 103(a)(3)(C)
Year 2  - ERISA Section v. Non-section 103(a)(3)(C)
Year 1 vs Year 2 ERISA Section 103(a)(3)(C) disclaimer
EBP audit & accounting guide
Auditor’s reports - 2nd year following implementation
Future revisions to EBP AAG enhancive updates
New auditing standards
New auditing standards
New auditing standard - SAS No. 142, 
Audit Evidence
Effective for periods ending on or after December 15, 2022
Supersedes AU-C section 500, 
Audit Evidence 
and amends various
other sections of SAS 122, 
Statements on Auditing Standards:
Clarification and Recodification
, as amended.
Addresses the evolving nature of transacting business as well as the
evolution of audit services.
use of emerging technologies and techniques by both preparers and auditors,
application of professional skepticism,
expanding use of external information sources to provide audit evidence, and
more broadly, the relevance and reliability of audit evidence.
SAS No. 142, 
Audit Evidence – 
Key changes
Expanded guidance on evaluating whether sufficient appropriate audit
evidence has been obtained.
more broadly focused on considering the attributes of information to be
used as audit evidence.
attributes of reliable information include its accuracy,  completeness,
authenticity, and susceptibility to bias
Automated tools and techniques
Professional skepticism
Management specialists
 
Identifying and evaluating information to be used as audit evidence
The types of information typically available (personnel file,
payroll register, etc.).
The forms of information (i.e., oral, visual, paper, electronic)
typically available.
The source of the information (plan sponsor, third-party, etc.).
The sufficiency and appropriateness (relevance and reliability) of
the audit evidence.
Whether additional procedures need to be considered to
substantiate the appropriateness (relevance and reliability) of
electronic audit evidence
*Example of additional
procedures to
substantiate
appropriateness:
 
If a SOC 1 report does
not address certain
controls that are
relevant or significant
to the plan’s
operations, the auditor
may need to consider
contacting the service
organization to obtain
specific information or
visit the service
organization and
perform such
procedures.
Audit evidence
Information may be obtained directly or derived individually or in
combination from different sources:
Management
External
Auditor
Evaluating audit evidence
Relevance
R
eliability
Accuracy
C
ompleteness
Controls over audit evidence
 
On the Horizon
SAS No. 143, 
Auditing accounting estimates and related
disclosures
Explains the nature of accounting estimates and concept of estimation uncertainty
Provides information about scalability of the SAS for all types of accounting estimates, from
relatively simple to complex
Requires a separate assessment of inherent risk and control risk at the assertion level
Includes enhanced risk assessment to address challenges auditors face in auditing
accounting estimates:
provides risk assessment requirements more specific to estimates
addresses the increasingly complex business environment and financial reporting
frameworks
Emphasizes that further audit procedures need to be responsive to the reasons for the
assessed risks of material misstatement at the relevant assertion level
Refers to relevant requirements in other AU-C sections and provides guidance to emphasize
the importance of the auditor’s decisions about controls relating to accounting estimates
Addresses the exercise of professional skepticism when auditing accounting estimates
Requires the auditor to evaluate whether the accounting estimates and related disclosures
are reasonable in the context of the applicable financial reporting framework
SAS 144, 
Use of specialists and use of pricing information
AU-C Section 501, 
Audit Evidence — Specific Considerations for Selected Items
Amendments to application material paragraphs provide guidance on applying AU-C
section 540 when management has used the work of a specialist in developing
accounting estimates:
enhance guidance about evaluating the work of the management’s specialist
no longer refer to using the work of an external inventory-taking firm as using the work
of a management’s specialist.
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Auditing Accounting Estimates and Related Disclosures
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Amendments to application paragraphs U-C section 620 to enhance the guidance related
to using the work of an auditor’s specialist.
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Understanding the entity and its environment and
assessing the risks of material misstatement
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requirements and guidance related to obtaining an understanding of the entity’s system of internal
control and assessing control risk
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definition of significant risk
requirements to evaluate the design of certain controls, including general IT controls, and to
determine whether such controls have been implemented
requirements relating to audit documentation
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(i.e., assessment of risk of material misstatement is the same as assessment of inherent risk)
“stand-back” requirement intended to drive an evaluation of the completeness of the auditor’s
identification of significant classes of transactions, account balances, and disclosures
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scalability
maintaining professional skepticism
Other audit considerations and
resources
Auditor independence resources
Revised DOL interpretation, 
Interpretive Bulletin Relating to the
Independence of Employee Benefit Plan Accountants
 (see 
EBPAQC
Alert # 496)
AICPA 
Online Ethics Library
AICPA Profess
ional Ethics AICPA/DOL independence comparison tool
(updated – included as webcast handout)
AICPA's 
Frequently Asked Questions: Application of the independence
rules to affiliates of employee benefit plans
EBPAQC tool, Non-attest services performed for EBP audit client
independence review tool
AICPA 
Professional Ethics Plain English Guide to Independence
 
EBP A&A Guide (August 2022 edition)
Strongly recommend
reading the guide!
Available at aicpa.org:
Online version
(Online Professional
Library)
E-book version
Print version
Peer review EBP audit engagement checklist
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October 2022 revision of 
PRP Section 20,700 
Employee Benefit Plan Audit
Engagement Checklist
Updated for the August 1, 2021 EBP Audit Guide
More fully integrates requirements of AU-C section 703, 
Forming an
Opinion and Reporting on Financial Statements of Employee Benefit Plans
Subject to ERISA
.
https://www.aicpa.org/resources/download/peer-review-employee-benefit-
plan-audit-engagement-checklist
 
Pooled employer plans (PEPs)
Type of multiple employer plan (MEP)
Effective January 1, 2021
DOL EBSA issued registration requirements for PPPs
Auditor independence considerations
“Affiliate” definition in AICPA Professional Ethic Staff FAQs
: 
Application
of the independence rules to affiliates of employee benefit plans
No model plan yet
SECURE 2.0 Act amends ERISA to require PEPs to designate a
named fiduciary (other than an employer in the plan) to be
responsible for collecting plan contributions and to implement
collection procedures.
Audit and reporting
requirements
considerations summarized
in EBPAQC 
Pooled
employer plans (PEPs)
special considerations
Data Protection/Cybersecurity
EBP industry focus on DOL guidance on cyber
o
Best practices for use by recordkeepers and other service providers
responsible for plan-related IT systems and data, and for plan
fiduciaries making prudent decisions on the service providers they
should hire.
o
Consider appropriate language in audit engagement letters
Nondisclosure agreements (NDAs) with service providers
 
 
Crypto (digital) assets
AICPA practice aid contains nonauthoritative guidance on how to
account for and audit digital assets.
https://www.aicpa.org/resources/download/accounting-for-
and-auditing-of-digital-assets-practice-aid-pdf
Actuarial mortality improvement update
2022 Mortality Improvement Update issued by the Retirement Plans
Experience Committee (RPEC) of the Society of Actuaries (SOA
Used for development of mortality improvement assumptions for
measuring obligations of retirement programs
Newest mortality data available is from 2020, which was severely
affected by the COVID-19 pandemic.
The SOA RPEC does not believe it would be appropriate to
incorporate, without adjustment, the substantially higher rates of
mortality experience from 2020 into the graduation and projection
models used to forecast future mortality.
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)
Deadline for SECURE/CARES Acts amendments
Original deadline for adopting any SECURE Act plan amendments
was the last day of the first plan year beginning on or after January
1, 2022
 
Plans could have voluntarily adopted provision under the CARES
Act by placing them in operation without amending the plan as long
as plan management makes the required amendments to plan
documents before the last day of the first plan year beginning on or
after January 1, 2022
 
IRS in Notice 2022-33 and Notice 2022-45 extended the deadline for
non-government plans (excluding 403(b) plans of public schools)
until December 31, 2025, to adopt the amendments required by
the SECURE Act and the CARES Act
EBPAQC resources
Tools:
ERISA employee benefit plan financial statement audit special
considerations—2023
Employee benefit plan audit engagement acceptance and continuance
considerations
Analyzing timeliness of remittances
Form 5500 considerations for auditors
DOL AICPA independence rule comparison (updated)
Firm preparedness checklist (updated)
Primers:
Actuarial methods and assumptions used in measuring plan benefit
obligations in health and welfare benefit plans
Timely remittance of employee contributions in defined contribution
retirement plans
New/updated EBPAQC resources
SAS No. 136 resource center
AICPA AU-C section 703, 
Forming an Opinion and Reporting on
Financial Statements of Employee Benefit Plans Subject to
ERISA
Audit Advisory on SAS No. 136
New Audit Standards for Employee Benefit Plans: An Overview
for Plan Management Plan Advisory
 
Primer - ERISA Section 103(a)(3)(C) audits of employee benefit
plans
Common deficiencies in ERISA Section 103(a)(3)(C) audit
certifications
Conditions for plan management to elect an ERISA Section
103(a)(3)(C) audit
Documentation of the auditor’s evaluation of management’s
assessment of an ERISA Section 103(a)(3)(C) audit certification
ERISA Section 103(a)(3)(C) audits resource center
2023 EBPAQC webcasts
EBPAQC Alert
#497 - Save the
Dates - 2023
Webcast
 
Look for
registration
information in
Alerts
 
All webcasts
1:00- 3:00 Eastern
Time
 
Share learning
opportunity with
your staff
Archived EBPAQC webcasts
ERISA section 103(a)(3)(C) audits: part 1
ERISA section 103(a)(3)(C) audits: part 2
Multi-employer plan audits
Multiple employer plan audits
Using SOC 1 reports in EBP audits
Current issues in defined benefit audits
Unique defined benefit plan issues – advanced
Actuarial reports in DB plan audits
Health and welfare plans part 1- basics and audit planning
Health and welfare plans part 2 – audit and reporting
Health and welfare plan advanced audit issues
EBP investments part 1- common EBP investments
EBP investments part 2- auditing investments
Common plan operational errors
Initial EBP audits
Available on the EBPAQC
website
 
 
 
 
 
 
No CPE available for
listening to an archived
event
Practice management tools and aids
EBPAQC resources and tools summary
ERISA audit inventory and staffing schedule
Discussing SAS 136 with plan clients
Firm preparedness checklist
Peer review findings in employee benefit plan audits
DOL AICPA independence rule comparison
Non-attest services performed for EBP audit client independence
review
Responding to an RFP
Request for proposal and the auditor evaluation process
Performing quality ERISA employee benefit plan audits: Firm best
practices
EBP annual internal inspections
Available on the
EBPAQC website
New AICPA website
www.aicpa.org
On AICPA
homepage….
 
Use AICPA log-in
 
Set up personal
profile and
preferences
 
Save items
(resources and
articles) and set up
shortcuts (EBPAQC)
 
View section and firm
memberships,
credentials
New EBPAQC website
Bookmark the page
https://www.aicpa.org/topic/e
mployee-benefit-plans
 
Find tools and
resources by type or
topic
At aicpa.org/EBPAQC
Sharing access to the Center website with staff
When your firm joined the Center you received a welcome email
that contained your firm’s 
unique activation link
.
You will need this link both to activate your account and to share
access with others.
There is 
no limit 
to the number of individuals in your firm to whom
you grant access
If you no longer have that email or unique firm URL, the firm’s
Designated Partner can contact the Center at 
EBPAQC@aicpa.org
Question & answer session
Thank you
 
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  1. Employee Benefit Plan Audit Quality Center AICPA EBPAQC Designated Audit Quality Partner audit planning 2023

  2. Presenters Michael Auerbach, DOL EBSA Debbie Smith, Grant Thornton LLP Josie Hammond, RSM US LLP Sandi Carrier, Deloitte

  3. Todays topics DOL update Legislative, regulatory and industry developments 2022 audit season observations/what to expect in 2023 New auditing standards Other audit considerations and resources EBPAQC resources Q&A session

  4. Handouts for todays event You can download presentation slides (in PDF or PowerPoint format) and other handouts by clicking on in the toolbar at the bottom of your screen Instructions to obtain your CPE certificate for today s event Webcast presentation slides EBPAQC primers: Actuarial methods and assumptions used in measuring plan benefit obligations in health and welfare benefit plans Timely remittance of employee contributions in defined contribution retirement plans EBPAQC tools: 2023 Special Considerations for EBP audits Firm preparedness checklist for EBP audits Employee benefit plan audit engagement acceptance and continuance considerations Analyzing timeliness of remittances Form 5500 considerations for auditors DOL AICPA independence rule comparison (updated)

  5. DOL update

  6. Changes at EBSA Lisa M. Gomez was confirmed and sworn in as the new Assistant Secretary on October 11, 2022

  7. Who are you performing the audit for? ERISA Section 103(a): ..the administrator of an employee benefit plan shall engage, on behalf of all plan participants, an independent qualified public accountant, who shall conduct such an examination of any financial statements of the plan, and of other books and records of the plan,

  8. DOL updated guidance on independence The Department updated its interpretive bulletin on independence of IQPAs IB 2022-01 issued on September 2, 2022 Revises and restates the interpretative bulletin 29 CFR 2509- 75.9, dating back to 1975 to remove certain outdated and unnecessarily restrictive provisions and to reorganize other provisions for clarity. Ability for a member to divest of publicly-traded securities held during the period being audited if certain conditions exist Guidance may be found at: https://www.dol.gov/newsroom/releases/ebsa/ebsa20220902

  9. Cybersecurity The Department issued guidance on this in April 2021 https://www.dol.gov/newsroom/releases/ebsa/ebsa20210414 Guidance comes in three parts Tips for Hiring a Service Provider Cybersecurity Best Practices Online Security Tips Review your service provider cybersecurity practices Review your plan s cybersecurity prctices

  10. 2022 Form 5500 changes Improvements in reporting on the actuarial and retirement plan schedules (Schedules MB, SB, and R) filed by defined benefit pension plans. Limited number of instruction changes focus on reporting for multiple- employer pension plans (including pooled employer plans). Technical changes that are part of the annual rollover of the Form 5500 and Form 5500-SF forms and instructions. Changes to the plan characteristics codes reported on line 8 of Form 5500, and on line 9 of Form 5500-SF, to improve the data reported on defined contribution multiple employer plans, including pooled employer plans. The instructions also contain clarifying additions related to Part II of Form 5500 and Form 5500-SF that collect plan sponsor and plan administrator information.

  11. Reporting compliance enforcement activities Missing IQPA Reports Large plan filers Section 104-50 deferred audits Late Filers/Non-Filers/Stop Filers Delinquent Filer Voluntary Compliance (DFVC) Program Integrity Form 5500-SF Eligibility

  12. Pay attention to DOL enforcement letters Inquiry Letter Notice of Rejection (NOR) Notice of Intent to Assess a Penalty Letter (NOI) Notice of Determination Letter (NOD) Administrative Law Appeal Call If You Have Questions

  13. What you and your client do not want Final Order If the Plan Administrator does not respond timely and properly to the NOI Letter NOD Letter The penalty assessment becomes final, and the case is sent to Treasury for collection of penalty

  14. ERISA plan audit universe 86,800 plan audits 4,300 CPA Firms $11 Trillion in Plan Assets 133.2 million participants

  15. DOL audit quality study Based on plan year 2020 Form 5500 filings Statistically based To entire population Five Strata Non-complex and complex plans Demographic questionnaire Workpaper reviews completed Data crunching and analysis

  16. Ongoing audit quality activities Complete Audit Quality Study Workpaper reviews of firms with audit practices less than 100 EBP audits Firm Inspections of firms with > 200 EBP audits Continued participation in outreach with state CPA societies and other stakeholder organizations Continued participation with AICPA Ethics, Peer Review, and Quality Center groups

  17. Pooled plan providers and PEPs 118 = Pooled Plan Providers that had filed an initial Form PR Pooled Plan Provider Registration (Form PR) 293 = PEPs were registered with the Department PEP audits (as of October 31, 2022)

  18. DOL resources www.dol.gov/ebsa For DOL publications, FAQs, copies of the Form 5500, instructions, and related schedules EBSA Office of the Chief Accountant 202-693-8360 EBSA Office of Regulations and Interpretations 202-693-8500 For questions about ERISA reporting, filing or other regulatory requirements DOL EFAST Help Center 1-866-463-3278 For questions regarding the Form 5500 or related schedules

  19. Legislative, regulatory and industry developments

  20. DOL proposed changes VFCP self-correction Proposal released in November 2022. DOL proposed adding a self-correction component to its Voluntary Fiduciary Correction Program (VFCP) Expands types of transactions covered under VFCP and simplifies the administrative tasks necessary to receive relief Written comments due on or before January 20, 2023. Conditions for self correction of delinquent contributions and loan repayments Correction to take place within 180 days from the date of withholding or receipt Lost earnings can not exceed $1,000 Self-correcting plans would be required to DO will notify the public of the availability of the amended and restated VFC Program in a subsequent Federal Register document. Use program s online calculator to determine lost earnings Use online portal to file a notice of the correction with DOL Complete and retain the self-correction retention record checklist

  21. DOL proposed changes (continued) Prohibited transaction exemption DOL also proposed a separate rule that would amend Prohibited Transaction Class Exemption (PTE) 2002-51 To allow an employer to obtain excise tax relief for self-corrected late contributions meeting certain conditions Self-correcting plans would notify the DOL that a correction has taken place via an online portal (eliminating the need for a formal application and no-action letter) Would eliminate a cap on the total number of similar voluntary corrections the agency will process for a single plan Employer-sponsored plans currently only allowed to apply for one such voluntary correction every three years

  22. 403(b) plans: determination letters IRS Revenue Procedure 2022-40 IRS will provide determination and termination letters to 403(b) plans beginning June 2023 Sponsors of individually designed 403(b) plans may request a determination letter for a new plan or for terminating a plan using the same program currently used by 401(k) plans and other plans qualified under Section 401(a) Rev. Proc. 2022-40 released November 7, 2022. Sponsors with an EIN ending in 1, 2, or 3 may begin requesting determination letters starting June 1, 2023 4, 5, 6, or 7 must wait until June 1, 2024 8, 9, or 0 must wait until June 1, 2025 Terminating 403(b) plans may request a plan termination letter without regard for EIN beginning June 1, 2023

  23. SECURE 2.0 Act of 2022 Contains sweeping changes relating to qualified retirement plans aimed at Increasing retirement savings Simplifying and clarifying retirement plan rules Other purposes Passed by Congress on December 23, 2022. Signed into law by President Biden on December 29, 2022. Plan amendments generally need not be made until the end of the first plan year beginning on or after January 1, 2025 However, plans must be operated in accordance with the effective date of each new provision!

  24. Auto enrollment/auto-escalation SECURE 2.0 New 401(k) and 403(b) plans must automatically enroll participants when they become eligible (employees may opt out of coverage) Initial rate of at least 3% but not more than 10% each year thereafter amount is increased by 1% until it reaches at least 10% but not more than 15% Section 101 Effective for plan years beginning after December 31, 2024. Exemptions: All existing 401(k) and 403(b) plans in effect on the date of enactment Small businesses with 10 or fewer employees New businesses (i.e., those that have been in business for less than three years) Church plans Governmental plans

  25. Changes to the Savers Credit SECURE 2.0 SECURE 2.0 repeals and replaces the Saver s Credit Current law allows for a nonrefundable Saver s Credit for certain individuals who make contributions to IRAs and employer retirement plans The credit currently paid in cash as part of a tax refund changes to a federal matching contribution that must be deposited into a taxpayer s IRA or retirement plan Sections 103 and 104 Effective for taxable years beginning after December 31, 2026. The amount of the match is 50% of retirement plan contributions, up to $2,000 per individual, and is subject to an income-based phase out

  26. Changes to long-term, part-time employees SECURE 2.0 SECURE 2.0 includes changes related to long-term, part-time employees: Section 125 Effective for plan years beginning after December 31, 2024. Modifies the measuring period for long-term, part-time employees from three years to two years Extends the long-term, part-time employee provision to 403(b) plans that are subject to ERISA The clarification is effective as if included in the 2019 SECURE Act, so effective beginning after December 31, 2020. Clarification: Pre-2021 service also disregarded for purposes of the vesting of employer contributions (and pre-2023 service is disregarded for eligibility and vesting purposes under the new SECURE 2.0 part- time employee provision)

  27. Required minimum distributions (RMD) and catch-up contributions SECURE 2.0 Section 107- RMDs- Effective for distributions made after December 31, 2022, for individuals who attain age 72 after that date. RMDs: Section 107- Increases to the RMD age to: 73 for a person who attains age 73 before January 1, 2023 75 for a person who attains age 74 after January 1, 2032 Section 325- Starting in 2024, Roth accounts will be exempt from the RMD rules while the participant is alive **** Catch-up contributions: Section 109- Increases the limit on catch-up contributions for individuals ages 60 to 63 to the greater of (i) $10,000 or (ii) 150% of the regular catch-up amount for 2024 (amounts to be adjusted annually based on the cost of living) Section 603- Starting in 2024, all catch-up contributions must be Roth contributions for participants with compensation equal to or in excess of $145,000 (indexed for inflation) Section 109-Catch-up contributions-- Effective for taxable years beginning after December 31, 2024.

  28. Student loan payments SECURE 2.0 Employers may make matching contributions under a 401(k) or 403(b) plan on employees qualified student loan payments Qualified student loan payment is defined as any indebtedness incurred by the employee solely to pay qualified higher education expenses of the employee Section 110 Effective for plan years beginning after December 31, 2023. Employees who receive such matching contributions are required to certify annually to the employer that such payment has been made on such loan, and employer may rely on the employee certification of payment Note: For purposes of the nondiscrimination rules, student loan payments will not be treated as plan contributions, and a plan may separately test the employees who receive matching contributions on student loan payments in determining whether it satisfies the ADP testing requirements for a given plan year

  29. Withdrawals for certain emergency expenses SECURE 2.0 SECURE 2.0 Act provides an exception from the 10% tax on certain early distributions: Section 115 Effective for distributions made after December 31, 2023. Distributions must be used for emergency expenses which are unforeseeable or immediate family needs relating to personal or family emergency expense One distribution, not to exceed $1,000, is permitted each year Participant can repay the distribution within three years No further emergency distributions are permissible during the three-year repayment period, unless repayment occurs Plan administrators generally may rely upon a participant s self-certification; however, the IRS is authorized to issue guidance to address situations in which a plan administrator has actual knowledge to the contrary or there are employee misrepresentations

  30. Increased dollar threshold for mandatory distributions SECURE 2.0 Increases involuntary distribution limit from $5,000 to $7,000 Section 304 Effective for distributions made after December 31, 2023.

  31. Pension linked emergency savings accounts (ESA) SECURE 2.0 DC plans may include an ESA for non-highly compensated employees; accounts are part of the plan document but accounted for separately Section 127 Effective for plan years beginning after December 31, 2023. Employers may automatically opt their employees into these accounts at no more than 3% of employee compensation Employee contributions cannot exceed $2,500, or a lower dollar amount determined by the employer (indexed for inflation) Amounts in excess of the dollar cap can be contributed to a Roth DC plan, or stopped until the amount drops below the dollar cap All contributions are made on a Roth-like basis (after tax) and treated as elective deferrals for purposes of matching contributions (annual match cap set at the max account balance (i.e., $2,500 or lower as set by plan sponsor) Participants may take monthly withdraws from their ESA, but the first four withdrawals for a year cannot be subject to any fees charged solely on the basis of such withdrawal Upon separation from service, the employee can receive their ESA as cash or roll it into their Roth DC plan (if they have one) or an IRA

  32. Recovery of retirement plan overpayments SECURE 2.0 Gives retirement plan fiduciaries discretion to not recoup overpayments mistakenly made to retirees Section 301 Effective upon enactment with certain retroactive relief for prior good faith interpretations of existing guidance. Fiduciary relief for failure to make the plan whole For ERISA-covered plans where a plan s fiduciaries choose to recoup overpayments, limitations and safeguards apply: Restrictions on the offset when a plan sponsor elects to offset future plan payments to recover the overpayment Restrictions on collection efforts from the participants (e.g., no interest, must recover within three years) Rollovers of the overpayments remain valid

  33. Compliance testing/corrections SECURE 2.0 Section 310- Top-heavy testing-- Effective for plan years beginning after December 31, 2023. Employers may perform top-heavy plan testing separately for non-excludable and excludable employees. IRS Employee Plans Compliance Resolution System (EPCRS) expanded to: Allow more types of errors to be rectified internally through self-correction Exempt certain failures to make RMDs from the excise tax penalty Section 305- EPCRS expansion-- Effective upon enactment. For ex, allows for the correction of many plan-loan errors through the self- correction process Grace period allowed to correct, without penalty, reasonable errors in administering automatic enrollment and automatic escalation features occurring after December 31, 2023- Section 350- Automatic features-- Effective for any errors after December 31, 2023. Errors must be corrected within 9 months after the end of the plan year in which the mistakes were made

  34. 403(b) plans SECURE 2.0 Section 602- Hardships-- Effective for plan years beginning after December 31, 2023. Conforms current hardship distribution rules for 401(k) plans to 403(b) plans Section 125- LT/PT employees-- Effective for plan years beginning after December 31, 2024. Long-term, part-time employee provision extended to 403(b) plans subject to ERISA 403(b) plans will now be allowed to invest in collective investment trusts (CIT) Section 128- CITs-- Effective for amounts invested after date of enactment. 403(b) plans can join a multiple employer plan (MEP) or pooled employer plan (PEP) Section 106- MEPS/PEPS-- Effective for plan years beginning after December 31, 2022.

  35. Annual audits for a group of plans SECURE 2.0 Clarifies that each plan filing under a group of plans (added by the SECURE Act) is required to submit audited financial statements if it has 100 participants or more. Section 345 Effective upon enactment. Plans with fewer than 100 participants that are included in a group of plans are not required to submit audited financial statements.

  36. Section 311- Birth/Adoptions Effective for distributions made after the date of the enactment. For prior distributions, the repayment period ends December 31, 2025. Other SECURE 2.0 Qualified birth and adoption distribution rules amended Plans may distribute up to $2,500 per year to pay premiums for high- quality long-term care insurance products (distributions exempt from the 10% additional tax on early distributions). Section 334- LT Care Insurance- - Effective beginning with distributions three years after the date of enactment. Retirement plans may allow withdrawals of the lesser of $10,000, indexed for inflation, or 50% of the participant s account balance by participants who have experienced domestic abuse Section 314- Domestic abuse-- Effective for distributions made after December 31, 2023. And there is even more!!!

  37. SECURE 2.0 of 2022things to think about Understand the sweeping changes impacting qualified retirement plans Changes have various effective dates Will require significant adjustments for employers, participants and their-party administrators Extensive IRS and DOL guidance will be needed May result in heavier administrative burdens and increased costs for employers Participants will need education on updates Coordination of updates with payroll providers and third-party administrators will be needed

  38. 2022 audit season observations/what to expect in 2023

  39. 2022 audit season observations/what to expect in 2023 Prepare for potential challenges: Staffing and readiness (firm, client, TPA) Reconciling balances Year 2 auditor reporting Certified information disclosure Form 5500 review considerations Other

  40. AU-C Section 703 (SAS 136) implementation challenges lessons learned Consideration of relevant plan provisions in audit risk assessment and response Performance procedures for ERISA Section 103(a)(3)(C) audits Substantially complete Form 5500 Management representation letter Auditor s reports Auditor s communications, including reportable findings

  41. Relevant plan provisions Paragraph .20 of AU-C section 703 states: .20 When designing and performing audit procedures, the auditor should consider relevant plan provisions that affect the risk of material misstatement at the relevant assertion level for classes of transactions, account balances, and disclosures. Relevant Plan Provisions FAQs (Q&A Section 6933 Auditing Employee Benefit Plans When is a plan provision considered relevant Is the auditor required to test all plan provisions related to classes of transactions, account balances and disclosures? Is there a requirement to document the auditor s consideration of every plan provision, or to explicitly document whether and where plan provisions the auditor identified for testing will be tested? Could there be plan provisions that the auditor may want to test beyond those identified as relevant based on risk assessment?

  42. Year 1 vs year 2 unmodified ERISA Section 103(a)(3)(C) Current Year- Unmodified ERISA Section 103(a)(3)(C) Report; Prior Year- Limited Scope Disclaimer (Year 1) Current and Prior year Unmodified ERISA Section 103(a)(3)(C) Report (Year 2) Scope and Nature of the ERISA Section 103(a)(3)(C) Audit of the 2021 Financial Statements Opinion on the 2021 Financial Statements Scope and Nature of the ERISA Section 103(a)(3)(C) Audit Opinion Basis for Opinion on the 2021 Financial Statements Basis for Opinion Going Concern (when applicable) Going Concern (when applicable) Key Audit Matters (when applicable) Key Audit Matters (when applicable) Responsibilities of Management for the 2021 Financial Statements Responsibilities of Management for the Financial Statements Auditor s Responsibilities for the Audit of the 2021 Financial Statements Auditor s Responsibilities for the Audit of the Financial Statements Other Matter 2021 Supplemental Schedule(s) Required by ERISA paragraph Other Matter Supplemental Schedule(s) Required by ERISA paragraph Other Matter Report on 2020 Financial Statements paragraph

  43. Year 2 - ERISA Section v. Non-section 103(a)(3)(C) ERISA Section 103(a)(3)(C) Report Non-section 103(a)(3)(C) Report N/A Scope and Nature of the ERISA Section 103(a)(3)(C) Audit Opinion Opinion Basis for Opinion Going Concern (when applicable) Basis for Opinion Going Concern (when applicable) Key Audit Matters (when applicable) Key Audit Matters (when applicable) Responsibilities of Management for the Financial Statements Responsibilities of Management for the Financial Statements Auditor s Responsibilities for the Audit of the Financial Statements Auditor s Responsibilities for the Audit of the Financial Statements Other Matter Supplemental Schedule(s) Required by ERISA paragraph Separate section Report on Supplemental Schedule(s) required by ERISA

  44. Year 1 vs Year 2 ERISA Section 103(a)(3)(C) disclaimer Current Year- Disclaimer on ERISA Section 103(a)(3)(C) Report; Prior Year- Limited Scope Disclaimer (Year 1) Current and Prior year Disclaimer on ERISA Section 103(a)(3)(C) Report (Year 2) Scope and Nature of the ERISA Section 103(a)(3)(C) Audit of the 2021 Financial Statements Disclaimer of Opinion on the 2021 Financial Statements Scope and Nature of the ERISA Section 103(a)(3)(C) Audit Disclaimer of Opinion Basis for Disclaimer of Opinion on the 2021 Financial Statements Basis for Disclaimer of Opinion Going Concern (when applicable) Going Concern (when applicable) Key Audit Matters (when applicable) Key Audit Matters (when applicable) Responsibilities of Management for the 2021 Financial Statements Responsibilities of Management for the Financial Statements Auditor s Responsibilities for the Audit of the 2021 Financial Statements Auditor s Responsibilities for the Audit of the Financial Statements Other Matter 2021 Supplemental Schedule(s) Required by ERISA paragraph Other Matter Supplemental Schedule(s) Required by ERISA paragraph Other Matter Report on 2020 Financial Statements paragraph

  45. EBP audit & accounting guide Auditor s reports - 2nd year following implementation Future revisions to EBP AAG enhancive updates

  46. New auditing standards

  47. New auditing standards Effective periods ending on or after December 15, 2022 Effective periods ending on or after December 15, 2023 (with early implementation permitted) SAS 142, Audit Evidence SAS 143, Auditing accounting estimates and related disclosures SAS 144, Use of specialists and use of pricing information SAS 145, Understanding the entity and its environment and assessing the risks of material misstatement

  48. New auditing standard - SAS No. 142, Audit Evidence Effective for periods ending on or after December 15, 2022 Supersedes AU-C section 500, Audit Evidence and amends various other sections of SAS 122, Statements on Auditing Standards: Clarification and Recodification, as amended. Addresses the evolving nature of transacting business as well as the evolution of audit services. use of emerging technologies and techniques by both preparers and auditors, application of professional skepticism, expanding use of external information sources to provide audit evidence, and more broadly, the relevance and reliability of audit evidence.

  49. SAS No. 142, Audit Evidence Key changes Expanded guidance on evaluating whether sufficient appropriate audit evidence has been obtained. more broadly focused on considering the attributes of information to be used as audit evidence. attributes of reliable information include its accuracy, completeness, authenticity, and susceptibility to bias Automated tools and techniques Professional skepticism Management specialists

  50. Identifying and evaluating information to be used as audit evidence *Example of additional procedures to substantiate appropriateness: The types of information typically available (personnel file, payroll register, etc.). The forms of information (i.e., oral, visual, paper, electronic) typically available. If a SOC 1 report does not address certain controls that are relevant or significant to the plan s operations, the auditor may need to consider contacting the service organization to obtain specific information or visit the service organization and perform such procedures. The source of the information (plan sponsor, third-party, etc.). The sufficiency and appropriateness (relevance and reliability) of the audit evidence. Whether additional procedures need to be considered to substantiate the appropriateness (relevance and reliability) of electronic audit evidence

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