Compliance January 12, 2006

PBGC Extends Use of the PFEA 85% Corporate Rate

January 12, 2006 (PLANSPONSOR.com) - The Pension Benefit Guaranty Corporation (PBGC) has issued Technical Update 06-1 which waives reporting by certain employers of financial and actuarial information under section 4010 of the Employee Retirement Income Security Act (ERISA).
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According to the update, ERISA section 4010 generally requires controlled groups to report to the PBGC if the aggregate unfunded vested benefits in plans maintained by the controlled group exceed $50 million (“the 4010 Gateway Test”).

For purposes of determining vested benefits for the 4010 Gateway Test for plan years ending before December 31, 2005, the Pension Funding Equity Act of 2004 (PFEA) set the PBGC’s variable rate premium interest rate for plan years beginning in 2004 or 2005 at 85% of the annual rate of interest determined by the Secretary of the Treasury on amounts invested conservatively in long?term investment grade corporate bonds (PFEA 85% Corporate Rate) for the calendar month preceding the calendar month in which the plan year begins.   According to the update, the PFEA 85% Corporate Rate no longer applies for plan years beginning on or after December 31, 2005.

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However, since pending legislation in the US House and Senate would extend the use of the PFEA 85% Corporate Rate for another year, the PBGC’s notice extends the rate’s use for another year.

Reporting of financial and actuarial information is waived for information years ending on or after December 31, 2005, and on or before June 30, 2006, provided no filing would be required if, for purposes of the 4010 Gateway Test, the PFEA 85% Corporate Rate is used for valuing vested benefits for plan years ending on or after December 31, 2005.

The update is  here .

Products January 11, 2006

ADP Releases New Version of Payroll System

January 11, 2006 (PLANSPONSOR.com) - ADP Small Business Services has announced the availability of an enhanced version of its payroll offering for small businesses.
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In the announcement ADP said EasyPayNet 5.0 allows users to tailor the payroll process according to their individual needs.   The pay input screens can be modified to match user input documents for faster entry.

Users input their payroll into the Web-based application, and EasyPayNet then calculates and pays employee wages, and pays and files federal, state and local payroll taxes. Users can choose to print their own paychecks, or receive signed payroll checks or direct deposit vouchers for their employees, according to the announcement.   Users can review payroll through on-screen audit reports before processing.

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EasyPayNet also includes the Data Access Suite, which enables small businesses to share payroll-related data with their accountant.   The application features a general ledger interface, electronic reports and generic data export capabilities that allow information to be transferred to spreadsheets or third-party accounting software packages.

Additional enhancements include automatic check voids, required field indicators on every screen, and new pre-fill options that automatically load payroll data into the system based on employee setup information.

For more informationcall 1-866-4ASK-ADP (1-866-427-5237), or visit http://sbs.adp.com .

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