Enmgy Q-00060-15-o Series1 Fiduciary - 1 Cpe Hour For A Score Of At Least 70%

10 Questions | Total Attempts: 51

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Company Quizzes & Trivia

JAN/FEB 2015 - SERIES 1 2015FIDUCIARY RISK MANAGEMENTPlease indicate whether each of the following statements is TRUE or FALSE


Questions and Answers
  • 1. 
    The safe harbor rule for the timing of participant contribution deposits with respect to small plan 5500 filers is based on 7-business days.
    • A. 

      True

    • B. 

      False

  • 2. 
    Large plan filers cannot rely on the 7-business day safe harbor rule for the timing of participant contribution deposits because they are actually expected to make their 401(k) deposits faster than the 7-business days and. instead, should aim to process the transfer of funds to the 401(k) plan simultaneous with the processing of their payroll tax deposits. 
    • A. 

      True

    • B. 

      False

  • 3. 
    The DOL provides reliance for employers who self-correct late deposits by applying interest that is based on the greater of the amount calculated using the DOL online calculator or the amount that is calculated using the  actual plan rate.
    • A. 

      True

    • B. 

      False

  • 4. 
    The DOL online calculator was designed to compute the interest amount involved when correcting late deposits under the Voluntary Fiduciary Correction Program (VFCP). 
    • A. 

      True

    • B. 

      False

  • 5. 
    There have been DOL investigations with respect to employers who have filed a Form 5330 to show the correction of the interest amount involved in late deposits according to the DOL online calculator and paid the 15% excise tax to the IRS; then the DOL investigators arbitrarily demanded that the interest be recalculated using the actual plan rates and the prior correction was deemed incomplete. 
    • A. 

      True

    • B. 

      False

  • 6. 
    Late deposits can be avoided by all employers if Best Practices are followed:  to initiate the transfer of participant contributions (including participant loan payments withheld from paychecks) on the same day as the paychecks are released to employees; to make the transfer of funds electronically (by ACH); and to validate that monies hit the 401(k) accounts within a few days of the transfers were initiated. 
    • A. 

      True

    • B. 

      False

  • 7. 
    The Department of Labor regulations on the timing of deposits no longer include the original baseline rule that indicated that participant contributions should be segregated from the employer’s assets no later than the 15th business day following the month in which the pay date occurred. 
    • A. 

      True

    • B. 

      False

  • 8. 
    Department of Labor officials have said that the timing of deposit rules can be satisfied by the transfer of participant contributions to a general trust account, without requiring that the splits are made to the participant directed accounts under the plan to satisfy the principles of the timing rules. 
    • A. 

      True

    • B. 

      False

  • 9. 
    Employers with recurring late deposit issues must follow through with corrective actions recommended by their TPA Consulting firm or the failure to correct becomes a serious issue in fiduciary risk management and the TPA firm should seriously consider presenting the lack of resolution of compliance issues as a reason for termination of services.
    • A. 

      True

    • B. 

      False

  • 10. 
    The DOL has not blessed any self-correction process for the correction of late deposits without a VFCP submission, in spite of requests from ASPPA to do so. 
    • A. 

      True

    • B. 

      False

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