Pensions and Benefits


The Profession's New Voice at the DOL

So complex is ERISA that the Secretary of Labor appoints a 15-member advisory council to make recommendations to the DOL on the act's myriad implementation issues. The council always has at least one representative from the accounting profession, and for the next three years that will be Rebecca J. Miller, a partner of McGladrey & Pullen and a former member of the AICPA employee benefit plans committee. The JofA spoke with her about her thoughts and concerns on technical issues—and the tangled politics of pensions.

Gordian knots

"As the sole CPA," said Miller, "I see one of my tasks as advising the council on the tax and financial statement implications of its recommendations—things that would have corporate managers screaming if they were passed." Miller is also the de facto defender of the profession. "I've heard so much criticism of FASB Statement no. 106, Employers' Accounting for Postretirement Benefits Other Than Pensions , because it's a common belief that this rule encourages companies to drop medical benefits for retirees since these benefits would now seriously affect financial statements. To which I say, 'No! These expenses were always there—Statement no. 106 just forced employers to face reality.'"

Like the other members, she can make one agenda recommendation a year; the council then votes on several to address over a 12-month period. For accountants, she said, a current key agenda item was clarifying the definition of an employee under ERISA. "Not only do clients have trouble with this, but firms do as well. Think of all the temporary help a firm may hire during tax season. Are these employees covered by ERISA provisions?"

During her tenure, Miller hopes to challenge the complexities of the current law. She cited the current "controlled group" rules that determine when several entities are considered one entity for discrimination testing. "The joke is that if you have to ask, then you're an affiliated entity. It is such an easy error for companies to make and the consequences are enormous," she said.

Track record

Although the council only makes recommendations and cannot set policy by itself, Miller pointed out its ability to make a difference for CPAs and their clients and companies. "Last year a big issue was small companies who found it too complicated and expensive to set up qualified plans. Proposals to give a tax credit to small businesses with such plans and to eliminate some complexities are already incorporated in bills before Congress. We have high hopes!"

Other members of the ERISA Advisory Council, all of whom work part-time on council business, include representatives from employee and employer organizations, the insurance industry, a corporate trust and the general public, as well as an actuary, an investment manager and an investment counselor.


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