1 Introduction and Background .01-.37
Introduction .01-.07
Background .08-.12
Financial Accounting and Reporting for ERISA Plans .13-.21
Audit Requirements .22-.24
Operation and Administration .25-.34
Accounting Records .35-.37
2 Planning and General Auditing Considerations .01-.142
Overview .01-.10
Quality Control Standards, Including Client Acceptance and Continuance and Engagement Quality Control Reviews .11-.18
Audit Scope .19-.38
Engagement Letter .39-.43
Audit Planning .44-.62
Audit Risk .63
Transactions Processed by Service Organizations .64
Using the Work of a Specialist .65-.94
Related-Party and Party in Interest Transactions .95-.116
Audit Considerations 106-.116
Consideration of Laws and Regulations and Prohibited Transactions .117-.128
Accounting Estimates .129-.130
Going Concern Considerations .131-.133
Initial Audits of the Plan .134-.142
3 Audit Risk Assessment .01-.71
Overview .01
Audit Risk .02-.06
Planning Materiality .07-.11
Understanding the Entity and Its Environment, Including Its Internal Control .12-.29
Risks Assessment and the Design of Further Audit Procedures .30-.49
Evaluation of Misstatements Identified During the Audit .50-.53
Audit Documentation .54-.55
Consideration of Fraud .56-.71
4 Internal Control .01-.28
Using a Service Organization and Related Audit Considerations .11-.28
5 Defined Contribution Retirement Plans Including Employee Stock Ownership Plans .01-.801
5A Defined Contribution Retirement Plans .01-[.399]
Introduction and Background .01-.05
Administration and Operation of a DC Plan .06-.08
Accounting, Reporting, and Auditing DC Plans .09-.10
Financial Statements .11-.12
Net Assets Available for Benefits .13-.67
Changes in Net Assets Available for Benefits .68-.76
Financial Statement Disclosures .77-.96
403(b) Plans or Arrangements .97-.100
Plan Transfers (Plan Mergers, Spin-Offs, and Other Transfers) .101-.105
Going Concern .106
Terminating Plans (Full and Partial) .107-.114
Changes in Service Providers .115-[.199]
Auditing Considerations for DC Plans .200-[.399]
5B Employee Stock Ownership Plans .400-[.799]
Introduction and Background .400-.421
Administration and Operation of an ESOP .422-.423
Regulatory Reporting Requirements .424
Accounting, Reporting, and Auditing ESOPs .425-.426
Financial Statements .427-.429
Net Assets Available for Benefits .430-.461
Changes in Net Assets Available for Benefits .462-.473
Financial Statement Disclosures .474-.492
Plan Transfers (Plan Mergers, Spin-Offs, and Other Transfers) .493
Going Concern .494
Terminating Plans (Full and Partial) .495-.501
Changes in Service Organization .502-[.599]
Auditing Considerations for ESOPs .600-[.799]
Appendix A—Defined Contribution Retirement Plans .800
Appendix B—Regulations, Administration, and Operation of an ESOP .801
6 Defined Benefit Pension Plans .01-.207
Introduction and Background .01-.04
Administration and Operation of a DB Plan .05-.07
Accounting, Reporting, and Auditing DB Plans .08-.11
Financial Statements .12-.15
Net Assets Available for Benefits .16-.71
Changes in Net Assets Available for Benefits .72-.78
Accumulated Plan Benefits .79-.93
Changes in Accumulated Plan Benefits .94
Financial Statement Disclosures .95-.116
Plan Transfers (Plan Mergers, Spin-Offs, and Other Transfers) .117-.122
Going Concern .123
Terminating Plans (Full or Partial) and Frozen Plans .124-.135
Changes in Service Providers .136
Auditing Considerations for DB Plans .137-.207
7 Health and Welfare Benefit Plans .01-.240
Introduction and Scope .01-.11
Background .12-.17
Health and Welfare Arrangements .18-.25
Financial Statements .26-.31
Net Assets Available for Benefits .32-.77
Changes in Net Assets Available for Benefits .78-.90
Benefit Obligations .91-.127
Changes in Benefit Obligations .128-.129
Financial Statement Disclosures .130-.147
Plan Transfers (Plan Mergers, Spin-Offs, and Other Transfers) .148-.149
Going Concern .150
Terminating Plans .151-.160
Terminating Trusts .161-.162
Tax Considerations .163-.168
Changes in Service Providers .169
Auditing Considerations for H&W Plans .170-.237
Appendix A—The Annual Health Care Process .238
Appendix B—Examples of Health and Welfare Arrangements .239
Appendix C—Risk Assessment and Internal Control Considerations—Claim Payments .240
8 Investments .01-.172
Introduction .01-.02
Background .03-.14
Valuation of Investments .15-.16
Fair Value Measurement .17-.35
Accounting and Disclosure for Investments .36-.38
RICs (Mutual Funds) .39
Investments in CCTs .40-.42
Master Trust Arrangements .43-.46
Other Investments .47-.50
Contracts with Insurance Entities .51-.66
Derivatives and Hedging Activities .67-.77
Securities Lending Arrangements .78-.82
Financial Statement Disclosures .83-.94
Auditing Considerations for Investments .95-.172
Audit Procedures for Certain Plan Investments .128-.161
Investments in Securities That Are Valued Based on the Investee’s Financial Results .162-.164
Limited-Scope Auditing Procedures .165-.172
9 Plan Tax Status .01-.31
Nondiscrimination and Other Operating Tests for Plan Qualification .12-.14
Unrelated Business Taxable Income .15-.20
Income Taxes .21-.25
Auditing Considerations .26-.31
10 Concluding the Audit and Other Auditing Considerations .01-.40
The Form 5500 .03-.08
Commitments and Contingencies .09-.13
Subsequent Events .14
Evaluating the Risk of Material Misstatement Due to Fraud at or Near the End of the Audit .15
Plan Representations .16-.22
Communications with Those Charged With Governance .23-.35
Communicating Internal Control Related Matters Identified in an Audit .36-.39
DOL Access to Auditors’ Working Papers .40
11 The Auditor’s Report .01-.91
What This Chapter Provides .03-.05
Background .06-.17
Supplemental Schedules Relating to ERISA and DOL Regulations (Full-Scope Audits for Nonissuers) .18-.24
Unmodified Opinions—Defined Contribution Retirement Plans .25-.34
Unmodified Opinions—Defined Benefit Pension Plans .35-.36
Unmodified Opinion—Health and Welfare Benefit Plans .37
Unmodified Opinion—Reporting on the Financial Statements of a Trust .38-.39
Unmodified Opinion—Form 11-K Filings with the SEC .40-.45
Full-Scope Audits—Unmodified Opinions on the Financial Statements with Modifications to the Report on Supplementary Information .46-.52
Prohibited Transactions .53-.56
Limited-Scope Audits Under DOL Regulations .57-.71
Change in Trustee .72
Reporting on Supplemental Schedules in a Limited-Scope Audit .73-.76
Standard Limited-Scope Audit Reports with Modifications to the Report on Supplemental Schedules .77-.79
Other Scope Limitations .80
Accumulated Plan Benefits—GAAP Departures and Changes in Accounting Estimates .81-.83
Terminating Plans .84-.85
Substantial Doubt With Respect to Going Concern .86-.87
Initial Audits of Plans .88
Prior Period Financial Statements Not Audited .89-.91
Appendix
A ERISA and Related Regulations
B Examples of Controls
C Illustrations of Financial Statements: Defined Contribution Retirement Plans
D Illustrations of Financial Statements: Employee Stock Ownership Plans
E Illustrations of Financial Statements: Defined Benefit Pension Plans
F Illustrations of Financial Statements: Health and Welfare Benefit Plans
G Consideration of Fraud in a Financial Statement Audit
H The New Leases Standard: FASB ASC 842
I Overview of Statements on Quality Control Standards
J Schedule of Changes Made to the Text from the Previous Edition
Glossary
Index of Pronouncements and Other Technical Guidance
Subject Index
