PANC 2009: Getting Ahead of the 2009 Schedule C

Jason K. Bortz, Partner, Davis & Harman, LLC, told attendees at the PLANADVISER National Conference in Orlando, Florida, that Schedule C (for plans with more than 100 participants) is an annual review of fees and a tool for the DoL to see who to audit and to enforce the Employee Retirement Income Security Act (ERISA). It is not just to disclose fees to plan sponsors, but to reveal potential conflicts of interest and revenue sharing. Further, it will be posted on the Internet for everyone to see, Bortz explained.

According to Douglas Prince, managing director, Stifel Nicolaus, an adviser’s job is to help sponsors get information together and understand all fees, including those paid to the adviser. Advisers may do an auditor search. If advisers do not take the lead in helping sponsors, others will, Prince warned.

Gary Plourde, senior vice president, Sales and Distribution, DailyAccess Corporation, suggested advisers should go over Schedule C line by line with clients. He noted that, for help, pensiongovernance.com has listed 58 codes of potential services to plans for which to disclose fees.

Preparing sponsors for Schedule C reporting is also a time when advisers can and should review with their clients their own services provided and fees received. Bortz reminded advisers that they are only responsible for reporting their own, or their companies’, fees to sponsors, not the fees of other providers.