When selecting an auditor the plan administrator should consider
Ensure the auditor is licensed:
Federal law requires that an auditor engaged for
an plan audit be licensed or certified as a public accountant by
a State regulatory authority. When engaging an auditor, you may
wish to discuss the auditor's work for other 401K clients. If you
have additional questions, you may also wish to verify with the
appropriate State regulatory authority that the provider holds a
valid, up-to-date license or certificate to perform auditing services.
Ensure the auditor is independent:
Auditors 401k plans should not have any financial
interests in the plan or the plan sponsor that would affect their
ability to render an objective, unbiased opinion about the financial
condition of the plan.
Ensure the auditor has experience with employee benefit plans:
One of the most common reasons for deficient accountants'
reports is the failure of the auditor to perform tests in areas
unique to employee benefit plan audits. The more training and experience
that an auditor has, the more familiar the auditor will be with
plan practices and operations, as well as the special auditing standards
and rules that apply to such plans.
Ensure you select a quality auditor:
A quality audit will help protect the assets and
the financial integrity of your plan and ensure that the necessary
funds will be available to pay retirement, health, and other promised
benefits to your employees. A quality audit also will help you carry
out your legal responsibility to file a complete and accurate annual
return/report for your plan each year.
Ask the potential auditor if they are a member
of the AICPA's Employee Benefit Plan Audit Quality Center.