EBPAQC Alert No. 457

• For GAAP financial statement reporting purposes employer contributions receivable are amounts due to the plan as of the financial reporting date. Amounts due include those pursuant to formal commitments as well as legal or contractual requirements. FASB ASC 960-310-25 provides GAAP guidance for recognition of contributions receivable in the plan's financial statements. Paragraphs 6.56-6.65 of the AICPA Audit and Accounting Guide: Employee Benefit Plans summarizes the financial statement reporting guidance for contributions and contributions receivable, including what may be considered evidence of a formal commitment, and includes recommendations from the AICPA's Financial Reporting Executive Committee (FinREC).
• Plan management is responsible for determining how to present employer contributions (including any receivable) on Schedule H. The instructions to Schedule H, Part I state that this schedule can be completed using the cash, modified cash, or accrual basis as long as one method is used consistently. The instructions for reporting employer contribution receivables on line 1b(1) of Schedule H state "noncash basis filers must include contributions due the plan by the employer but not yet paid."
• ERISA requires an explanation of the differences, if any, between the information contained in the plan's financial statements and the amounts reported on Schedule H. If employer contributions on Schedule H are presented in conformity with GAAP consistent with the plan's financial statements, there would be no difference requiring explanation in the plan's financial statements.
• The plan administrator must obtain a completed Schedule SB that is prepared and signed by the plan's actuary to include in the Form 5500 filing. Contributions made to the plan are reported in Part IV of Schedule SB and include contributions designated for the plan year or those allocated to unpaid minimum required contributions for a prior plan year. IRS Notice 2020-61, Q-8 addresses special rules for reporting contributions on Schedule SB if the plan sponsor makes a contribution for a plan year after the original due date for the plan year, but on or before the extended due date under § 3608(a) of the CARES Act. For purposes of determining the value of plan assets, IRS Notice 2020-61, Q-9 indicates that a contribution that is made after the original due date for a plan year (but on or before the extended due date for the plan year under § 3608(a) of the CARES Act) is taken into account as of a valuation date for a plan year after the plan year for which the contribution was made.
• If the plan administrator determines it is necessary to amend Schedule SB to reflect contributions designated for the 2019 plan year that are funded subsequent to the Form 5500 extended due date of October 15, 2020, this would not result in the need to revise the employer contribution amounts in the plan's audited financial statements. If the plan administrator determines that Schedule H needs to be amended, plan management will need to consider whether the difference between Schedule H and the plan's financial statements affects the disclosures in the financial statements.

Exam content outline review: Review outline to ensure topics selected are appropriate for testing of advanced-level competencies related to EBP engagements. Time commitment: 1-2 virtual conference call(s), approximating 4 hours total, in October 2020.

Exam question writers: Attend question writing/reviewing training. After training, writers will develop 30 exam questions. Time commitment: virtual question writing and reviewing training held over two days (not all day); 1-2 virtual conference calls to follow-up on training; estimate 1 hour to write each question through November 2020.

Exam question reviewers: Attend question writing/reviewing training. Review will encompass a technical review of content as well as reviewing from a competency level. Time commitment: virtual question writing and reviewing training held over two days (not all day); 1-2 virtual conference calls to follow-up on training; estimate 15 minutes to review each question from November through January 2021.

Exam cut score meeting reviewers: The cut (or passing) score reviewers will determine the passing score of the exam based on psychometric formulas once practitioners have taken the proposed exam. Time commitment: 1.5-days, in-person or virtual meeting (late April/early May 2021; 3-5 hours of pre-work.

EBPAQC Executive Committee

The EBPAQC Executive Committee establishes general policies of the Center and oversees its activities. The Executive Committee is made up of 16 members who may serve up to three consecutive one-year terms. The Committee comprises members from small, medium, and large firms from various geographic regions throughout the country. Candidates for the EBPAQC Executive Committee must be the firm's Center Designated Partner, have significant employee benefit plan audit experience, and the candidate's firm must be in compliance with all Center membership requirements. Candidates should also have demonstrated commitment to improving ERISA audit quality within their firm and be active in their state CPA society or other similar activities. Membership on the Executive Committee requires a minimum commitment of 125 to 150 volunteer hours per year. Committee members should be prepared to attend two in-person committee meetings per year and periodic committee conference calls, participate in the activities of two or three task forces, participate on EBPAQC webinars, and speak on behalf of the Center at various AICPA and state society conferences.

EBP Expert Panel

The Employee Benefit Plan Expert Panel monitors employee benefit plan industry developments, trends and opportunities to identify and advise on reporting, attest and assurance issues unique to employee benefit plans. The EBP Expert Panel is made up of 14 members who may serve up to three consecutive one-year terms. The Panel comprises members from small, medium, and large firms from various geographic regions throughout the country. Membership on the Expert Panel requires a minimum commitment of 75 to 100 volunteer hours per year. Candidates will be evaluated based on employee benefit plan audit experience, proven leadership qualities and skills, availability to participate in panel and task force activities, and active participation in their state CPA society or other similar activities.