Starr testifies in Washington.Randi L. Starr, chairwoman of the American Institute of CPAs employee benefit plans committee, testified before the House Subcommittee on Employer-Employee Relations on a variety, of pension reform issues.
Starr, a former member of the Labor Department's Employee Retirement Income Security Act The Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.A. § 1001 et seq. (1974), is a federal law that sets minimum standards for most voluntarily established Pension and health plans in private industry to provide protection for individuals enrolled in these plans. Advisory Council, emphasized the Institute's support for elimination of the limited scope audit exception. (See "Clinton Offers Major Pension Changes," JofA, July96, page 17, for more on the Institute's position on a host of reforms in President Clinton's Retirement Savings and Security Act [HR 3520].) "We believe the scope of the audit should not be restricted in an,,' way," said Starr. "Plan participants Plan participants
Employees or other beneficiaries who are eligible to receive benefits from a company's employee benefit plan. cannot be provided the full assurance contemplated by ERISA See Employee Retirement Income Security Act.
See Employee Retirement Income Security Act (ERISA). if the independent accountant's audit is restricted."
She also called for strengthening the definition of the independent qualified accountant and pointed out the extensive continuing professional education and peer review requirements for AICPA AICPA
See American Institute of Certified Public Accountants (AICPA). members. Starr had an alternative to the bill's current proposal that accountants have at least 16 hours of employee benefit plan CPE (Customer Premises Equipment) Communications equipment that resides on the customer's premises.
CPE - Customer Premises Equipment : the secretary of labor should have the authority to establish CPE requirements within one year after enactment of the law. "This approach could address the many implementation issues of an additional CPE requirement as have been experienced with other CPE requirements."
Starr also discussed the AICPA's recommendations for ensuring plan participants know the facts about their penisions and said that the Labor Department The Department of Labor (DOL) administers federal labor laws for the Executive Branch of the federal government. Its mission is "to foster, promote, and develop the welfare of the wage earners of the United States, to improve their working should
* Require each plan's summary annual report to include essential information such as the sufficiency of assets and the status of plan insurance. Plans should have to notify the participant of an opinion by the independent auditor of the plan's financial statements that is other than an unqualified opinion.
* Make sure all plan participants receive their summary. annual reports.
* Ensure every individual member of a multiemployer plan has access to information on the amount of earned benefits. Not all workers currently have the right to that information: The DOL DOL - Display Oriented Language. Subsystem of DOCUS. Sammet 1969, p.678. never finalized proposed regulations in 1980 correcting this.
* Shorten the time allowed for plans to notify employees of significant changes to no more than 90 days from the current seven months or more.