According to an article in Employee Benefit News, the SAS 70 audit is a good place to start when researching Third Party Administrators (TPA) for your retirement plan. The SAS 70 audit (short for Statement on Auditing Standards) is conducted by an independent auditor and demonstrates the internal controls in place to ensure compliance with ERISA.

The article cites several controls the SAS 70 should provide assurance for:

•    Participant enrollment information, cash receipts, distribution of plan assets, and changes to nonfinancial account information are processed in a complete, accurate, and timely manner.
•    Dividends are recorded in a complete, accurate and timely manner.
•    All direct and related transactions for investment options are processed in a complete, accurate and timely manner.
•    Plan assets are safeguarded from any losses or misappropriation.
•    Physical and environmental security safeguards are in place.
•    Access to systems, databases and any other devices granted to authorized individuals only.
•    New plan documentation is properly established in accordance with the plan.
•    Participant documentation for new plans is accurately recorded.

Also mentioned in the article is that of the two types of SAS 70 Audits, (Type I and Type II), Type II should be the considered the only acceptable SAS 70. NADART has a SAS 70 Type II audit report conducted every year and it is available upon request. If you would like to learn more about our retirement plans, please contact a NADART Representative at (800) 462-3278, ext. 7161 or e-mail nadart401k@nada.org.