Surviving the Audit: Warning Signs


Our blog series “Surviving the Audit” is a supplement to our webinar on Department of Labor audits which will be presented on Tuesday, July 7 at 10:30 a.m.  You can register for the webinar by clicking here.

Are you worried that the U.S. Department of Labor (DOL) may be knocking on your business’ door?  In 2013, more than 70 percent of audits resulted in monetary fines or other corrective action.  This series hopes to give you some insight on how to prepare your business for an audit.  Today we are talking about triggers that can cause the DOL to come knocking. There are several factors that increase or indicate the likelihood that your business will be audited.

1.  Participant Complaints: If any of your plans’ participants complain about potential ERISA violations, you plan will most likely be subject to an audit.

2.  Incomplete or Inconsistent Information:  The DOL is more likely to investigate a plan that has incomplete answers on the plan’s Form 5500 or if information is inconsistent from year to year.

3.  National Enforcement Priorities: The DOL also has national enforcement priorities and projects that it works on separate from any complaints or inconsistent information.  The Employee Benefit Security Administration (EBSA) focuses on large cases to protect areas that have the greatest impact on plan assets and participants’ benefits.  In addition EBSA is focusing on delinquent employee contributions in order to help protect employee contributions.  In addition the DOL also has several national enforcement projects that receive emphasis in investigating including the Contributory Plans Criminal Project, Health Benefits Security Project, Employee Stock Ownership Plans, Voluntary Fiduciary Correction Program, Fiduciary Service Provider Compensation Project, and Rapid ERISA Action Team.

DOL audits can be triggered by mistakes, negligence, or simply because your plan falls within one of the areas in which the DOL is focusing investigative effort.  Regardless of why your company may be selected it is important to be prepared.  At AUI we have some tools that can help you better prepare for this type of situation.  Please contact us today to set up an appointment with one of our experts.

Disclaimer: The intent of this analysis is to provide general information regarding the provisions of current healthcare reform legislation and regulation.  It does not necessarily fully address all your organization’s specific issues.  It should not be construed as, nor is it intended to provide, legal advice.  Your organization’s general counsel or an attorney who specializes in this practice area should address questions regarding specific issues.

We do more than cover small businesses and individuals with the right insurance policies and benefit plans – what motivates our team is helping you save more so you can invest more in your team, family, and goals.

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