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March 19, 2019

What is a 401(k) Plan Census?

In the first part of any plan year, your record-keeper will routinely ask you to prepare or review something called a plan census.

EMPLOYEE INFORMATION NEEDED FOR A 401(k) PLAN CENSUS

This document will contain information for each employee of the company including:

  • Name
  • Date of birth
  • Date of hire
  • Compensation and amounts contributed to the 401(k) plan during the year
  • Hours worked
  • Termination date (if applicable)

The specific provider may request additional information depending on the nature of your plan provisions.  The data is compiled based on the year-end information from the prior year. This data is used by the provider to complete the annual discrimination testing required by the Internal Revenue Service and Department of Labor standards. This testing is very important to ensure the Plan remains qualified. 

HOW TO PREPARE FOR A 401(k) PLAN CENSUS

To ensure the accuracy of the plan census, plan administrators can:

  • Complete a reconciliation of the compensation amounts to the year-end payroll data.
  • Review random employee data and compare to the employee human resources file to ensure accuracy.
  • Review the overall data for inconsistencies such as employees that remain active with the company but have no compensation.
  • Review employees with participant 401(k) contributions but no related employer match contributions.  

It’s vital that you hire a trusted auditor when it’s time for your plan’s audit.

Anders specializes in retirement plan audits. If you would like to discuss our audit process in more detail or need an audit, request a free consult below. We can help you navigate the world of 401(k) audits proficiently. We also offer off-site assistance and flat-fee pricing so there are no surprises when the job is complete.

For assistance, contact the team at (314)-886-7913 to talk about your 401(k) audit needs.

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