ERISA employee benefit plan financial statement audit special considerations
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ERISA employee benefit plan financial statement audit special considerations

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This non-authoritative Employee Benefit Plan Audit Quality Center (EBPAQC) resource is intended to help auditors identify and understand recent legislative, regulatory, and professional developments that may impact the 2022 ERISA employee benefit plan audit season (including audits of ERISA plan financial statements for periods ending December 31, 2021). This document may be helpful in initiating discussions throughout the course of the audit with the engagement team, plan sponsor, plan management, and third-party service organizations. This document has not been approved, disapproved, or otherwise acted on by any senior technical committee of the AICPA.

The 2022 EBP audit season will present the auditor with new and special considerations for ERISA audits, including:

New auditing standards and audit and accounting guidance

  • For ERISA plans, implementing new auditing standards and reporting requirements in SAS No. 136, Forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA, as amended (codified in AU-C section 703).[1]

  • For multiemployer plans, applying the new accounting and auditing guidance in Chapter 9 of the August 1, 2021 AICPA Audit and Accounting Guide, Employee Benefit Plans (EBP Guide), particularly the new guidance related to using the work of internal auditors or others related to payroll compliance audits.

  • The EBP Guide has been updated to reflect conforming changes from FASB ASC 606.

New plan type

  • Accounting and auditing for pooled employer plans (PEPs), a new type of a multiple employer defined contribution plan introduced under the Setting Every Community Up for Retirement Enhancement (SECURE) Act.

Laws and regulations

  • Continuing to evaluate plan financial statement disclosure reporting implications resulting from the effects of the Coronavirus Aid, Relief, and Economic Security (CARES) Act; Department of Labor (DOL) guidance and relief for COVID-19, including procedural requirements for plan loans and distributions and the associated adequate security requirements; and IRS notices expanding access to COVID-19 related distributions (CRDs), loans, and providing guidance on required minimum distributions.

Plan environment and controls

  • Continuing to understand the impact of the COVID-19 pandemic and its effects on the 2021 plan year for the plan and plan sponsor environment; plan operations and controls at the plan sponsor, plan, and third-party service organizations; and the changes in processes;

  • Assessing audit risk associated with any changes in current environment, including the risk of fraud;

  • Evaluating the effect of the “Great Resignation” (that is, when workers quit their jobs at historic rates during 2021) on the plan including potential negative effects on processes and controls, partial or full plan terminations, and short-term liquidity and long-term solvency issues for plan sponsors;

  • Evaluating the completeness of financial statements and adequacy of disclosures related to conditions and events during the plan year and any subsequent events; and

  • Determining whether any conditions or events would require modifications to the auditor’s opinion.

This tool also includes references to additional AICPA resources on auditing in the current environment.


[1] All AU-C sections can be found in AICPA Professional Standards.

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