Who Audits Your Employee Benefit Plan? 

Posted on Monday, June 24, 2024

Ensuring your auditors are not only experienced but also independent is crucial for the integrity and reliability of employee benefit plan (EBP) audits. The Department of Labor (DOL) emphasizes the importance of selecting auditors who are independent and also possess specialized knowledge and experience in auditing employee benefit plans. 

Auditor independence is a fundamental principle that ensures objectivity and impartiality in the audit process. Auditors must be free from any conflicts of interest that could compromise their ability to provide an unbiased opinion on the financial statements of an employee benefit plan. This independence is critical for maintaining the trust of plan participants and regulatory authorities. To achieve this, auditors must adhere to strict ethical standards and avoid any relationships or financial interests that could impair their independence. 

In addition to independence, the expertise of the auditor is a key factor in ensuring the quality of EBP audits. EBPs have unique and complex accounting and regulatory requirements that necessitate specialized knowledge and experience. Auditors who lack this expertise may overlook critical issues or fail to identify compliance violations, resulting in deficient audits. Therefore, it is essential for plan sponsors to select auditors who have a proven track record in conducting EBP audits and are familiar with the specific regulations governing these plans. 

Membership in professional organizations, such as the American Institute of Certified Public Accountants (AICPA) Employee Benefit Plan Audit Quality Center (AICPA EBPAQC), is an indicator of an auditor's commitment to maintaining high standards of quality and expertise.  DWD CPAs & Advisors have been members since the Center’s inception. Our auditors participate annually in specialized training and peer review processes that enhance their capabilities in conducting EBP audits. This membership indicates a dedication to continuous improvement and adherence to best practices. 

Ongoing education and training are essential for auditors to stay updated on the latest regulatory changes and auditing standards. The introduction of new legislation, such as the SECURE Act 2.0, and updates to auditing standards, like SAS 136, require auditors to continuously enhance their knowledge and skills. By investing in professional development, auditors can ensure they are well-equipped to handle the evolving complexities of EBP audits and provide reliable assurance to plan sponsors and participants (KLR) . 

Auditor independence and expertise are critical for the success of EBP audits. By selecting independent auditors with specialized knowledge and experience, plan sponsors can ensure high-quality audits that comply with regulatory requirements and protect the interests of their employees. 

Please contact us today to learn more about our employee benefit plan audits. 

Posted in Employee Benefit Plan Audits

Disclaimer: The information contained in Dulin, Ward & DeWald’s blog is provided for general educational purposes only and should not be construed as financial or legal advice on any subject matter. Before taking any action based on this information, we strongly encourage you to consult competent legal, accounting or other professional advice about your specific situation. Questions on blog posts may be submitted to your DWD representative.