Tip for June 2019
Operational assessments improve employee benefit plans and cut fiduciary risk
Manufacturing, higher education, and healthcare are just a few of the industry sectors that have to comply with fiduciary rules. That makes a check up on your plan’s operations an imperative.
What is an operational assessment?
An operational assessment is an evaluation of an employee benefit plan’s conformance to fiduciary rules. It’s more than just a review of best practices, though. Authentic assessments are conducted by a certified governance, risk and compliance (GRC) expert that specializes in employee benefit plans.
Assessments identify gaps between real world benefit plan operations and fiduciary rules.
The assessment rating
One of the key products of a Roland|Criss operations assessment is the Qualified Plan Review Rating (QPR Rating™). The QPR Rating is a management tool that’s used by fiduciary committees to make continuous improvements in their practices and to prove their conformance to mirky regulations. The rating also helps cut CPA’s plan auditing costs, leads to lower plan fees, readies the plan for a surprise audit by the Department of Labor, and in unbiased terms reveals how well vendors are performing.
Key steps that should be included in an operations assessment
- verify that a retirement plan’s operations adhere to its policies;
- test for deficiencies that may have been caused by payroll errors;
- examine control procedures and update them to meet Department of Labor standards;
- test the reasonableness of service providers’ fees;
- exploit the value of the plan’s assets in order to lower administrative and investment costs paid by plan participants;
- test for conflicts of interest;
- identify opportunities for improvement in all four fiduciary disciplines (governance, administration, investments, and controls);
- deliver a current state update for inclusion in the enterprise’s risk management program;
- add clarity to the relationship between a plan sponsor and the plan’s vendors;
- fees should be scaled to fit a plan’s size and complexity.
Contact us here for a demonstration of how an employee benefit plan operations assessment works.
QPR Rating™ is a trademark of Roland|Criss
