Providing retirement plans is one of the greatest perks a company can offer. Benefit plans allow businesses to attract and retain high-quality talent. Additionally, providing employees with quality benefits and the ability to build wealth increases loyalty and employee satisfaction.
The Employee Retirement Income Security Act (ERISA), is a federal law that dictates how employer-sponsored benefit plans must be administered.
With the exception of religious institutions and government entities, all companies are subject to ERSISA regulations. Employer-sponsored benefits that are covered by ERISA include:
- Health plans
- Dental plans
- Vision plans
- Life insurance policies
- Accidental death and dismemberment policies
- Flexible spending accounts
- Employee assistance programs
- Disability insurance
- Pensions and Profit Sharing Plans
To ensure your organization is compliant with all ERISA requirements, it is important to find a quality professional that provides ERISA audit services. Since adhering to federal regulations is so important, the selection of an ERISA audit professional should not be taken lightly.
The guidelines below can help you find and qualify the right ERISA audit accounting services professional to meet the needs of your organization.
Where to Look for an ERISA Audit Accounting Services Professional
Referrals
Referrals are often the best way to find a professional to meet the needs of your business. Business friends and contacts are a good place to start, particularly those individuals who are business owners and who have a long-standing relationship with an accounting firm. Contacts you meet through professional organizations may also be a good resource for finding professional assistance.
Referrals provide great insight into how that individual conducts business.
Better Business Bureau
The Better Business Bureau (BBB) is another resource for evaluating professionals, including those that perform ERISA audits. BBB reports contain a wealth of information including:
- Contact information
- Names of owners or those in senior management
- How long a company has been in business
- A company’s complaint history and how the business has responded to and addressed complaints
- Licensing information
It is a good practice to check the reliability report of a potential audit firm prior to making your selection.
Yelp
Social media sites like Yelp allow consumers to post their experiences with companies, including those that provide professional services. Reading reviews can provide additional insight on how an organization does business, including how they handle disputes with customers.
When reviewing Yelp or similar social media sites, it is important to note that individuals that are unhappy with a service are more likely to post a review. Therefore, a single negative review – or positive review – may not paint a realistic picture of how a company does business. However, a pattern of negative reviews may be indicative of a larger issue.
How to Interview ERISA Audit Professionals
Once you have a list of accounting firms, it is important to narrow down your choices by interviewing each potential accounting firm. The goal should be finding an auditor that has the professional qualifications to handle the job, as well as the personality and professionalism to be a good business partner. Take time to learn more about each candidate in order to make a fully informed decision.
ERISA Audit Experience
While federal law indicates ERISA auditors must be certified public accounts (CPAs), all CPAs will not have experience and performing ERISA audits. Therefore, it is important to understand the firm's qualifications and experience in handling ERISA audits.
Be sure to consider the size of organizations the firm works with. Firms that have only done business with large companies may not be suited to work with small businesses and vice versa. Look for a professional services firm with experience with organizations that are similar to your own.
Fee Determination
It is often difficult for a professional services company to provide exact pricing without detailed information about a project. This holds true for auditing services. Rather than asking for a specific price, ask how fees are determined.
Look for an accounting firm that bases fees on the nature of the audit. More complicated audits should be more costly than simple audits. This helps to ensure that your business only incurs costs that are directly related to its needs.
Request Proposals
As with any purchasing decision, competition is often a great way to ensure your company receives the best price and service. Ask potential auditors for proposals for their services. In order to receive accurate proposals, it is important to outline exactly what services your organization is looking for.
Failing to accurately set the stage will result in proposals that are not in-line with what you’re looking for and that are not easily compared with one another. Your requests for proposals should be thorough and should contain the following:
- Contact information for your organization.
- Your organization’s requirements for ERISA audits.
- A format for providing proposals, submission instructions and the deadline for proposal submission.
- Details about how ERISA records are currently kept and if information from previous years is readily available.
- Details on how your staff can support the audit process.
- Your expectations for how the audit will be performed and how results will be communicated.
As a part of the proposal process, you may request referrals and licensing information. You can then use this information to further research and narrow down your choice of an audit firm.
Schedule a Meeting
Often, a face-to-face meeting is the best way to get a feel for an individual and the way they do business. A free consultation or information session can provide another layer of information and may be the best way to determine if an individual is a good fit as a business partner.
While it may seem like a lengthy and time-consuming process, taking the necessary steps before hiring an ERISA audit accounting professional ensures a better experience once you begin working together.
