If you have over 100 participants in your employee benefit plan, then an annual audit is mandated. But who you choose to do your audit will make a difference in the quality of audit you receive. Here are 4 guidelines to help you make a choice that’s right for your company:
1. Quantity of plan audits indicates knowledge and experience. Some firms use employee benefit audits as fill-in work, and may not be familiar with the ERISA requirements. The more audits performed by your CPA specifically for employee benefit plans, the smoother (i.e. less time-consuming) you can expect the process to be.
2. Peer review of a CPA firm provides verification of professional competence. As a member of the AICPA (American Institute of CPAs), firms must have their practice reviewed every three years by an outside CPA firm. Such as review, when it includes an Employee Benefit Plan Audit, is a testimony to professional and ethical standards. This is especially important since you, the plan fiduciary, are ultimately responsible for the audit results.
3. A dedicated Employee Benefit Plan Audit team can offer value beyond the requirement. When a CPA firm is dedicated to Employee Benefit Plans, the service you receive is a priority because they want this type of work and want to keep it annually. Also, specialized knowledge regarding Employee Benefit Plans brings expertise to the audit report. You can expect recommendations for operational efficiencies and awareness of changes ahead regarding compliance.
4. Evidence of continuing education indicates current knowledge of the regulations. A CPA firm that invests in continuing training better understands the operations and fiduciary responsibilities for EB plans. Your position is protected when you’re certain that the CPA performing your audit is qualified.
Many companies look at the price of the audit to determine which CPA firm wins the bid. Consider the above qualifications in addition to price to make sure that your audit is performed correctly and protects your liability.