BenefitsAll

Copy It Until You Understand It

April 07, 2014
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Most of us learn by doing or we just do things without ever learning. The workplace is full of people saying and doing things that they don't really understand. Now I'm not hating on these folks, but I can usually recognize when someone is talking about or doing something they don't quite comprehend. Mostly because they are unable to answer the most basic question, "why are we doing this?" They know the "how" but not the "why" of what they are doing.

Like I said, I'm not mad at them. I know the feeling of doing something without fully understanding it. It's a feeling that nearly every benefits professional experiences at least once. You see, we are often asked to do things with little or no instruction beforehand. Our boss can't help because he doesn't know how to do it or doesn't want to take the time to teach us; and the person who did it last is either gone or not interested in helping.

So how do you learn and not just do technical work with little or no assistance. You check out what was done before, copy it, and study it. Copy before study? Yes. Sometimes you just need to do the task and worry about understanding it later. But if you do have time to study before copying, by all means do that.

Case Study: Filing Form 5500 for Health & Welfare and Retirement Plans

Background

Federal law (ERISA and the Internal Revenue Code) requires employers who have a certain number of employees participating in their health insurance or retirement plans, to file the Form 5500 each year. The Department of Labor, Internal Revenue Service, and the Pension Benefit Guaranty Corporation created the Form jointly. The Form serves numerous purposes and provides information to many groups.

For example, Congress and the White House can use aggregate Form 5500 data to estimate the annual loss of federal tax revenue due to participation in tax-favored health insurance and retirement plans. They can also determine who doesn't have access to these plans and decide what policies to put in place to address the needs of these people.

In sum, the Form 5500 is a compliance document that assures benefit plans are administered in accordance with the law. Also, it is a valuable research tool for the public and private sectors.

First-timer

One year, the CFO of our company decided his office would no longer prepare the Form 5500 for the health and welfare benefit plans. The VP of HR who was responsible for the administration of the plans now had to prepare the annual filing. Which meant I had to prepare it. This was a first for me but I knew that if I could view a previous filing, I could figure out what to do. This is what I did.

  • I requested copies of the filings from the CFO, but they were skimpy and incomplete (they neglected to make copies of the Schedules)
  • I read everything available on the DOL website about Form 5500 and what data I needed to include on the Form
  • I discovered a valuable, free online resource called freeerisa.com that had a database of prior years' 5500 filings from just about any company who filed (the service is now called freeerisa.benefitspro.com). I downloaded and printed the previous five (5) years of filings from our firm
  • I emailed our insurers to request the Schedules I needed to prepare the Form (they are supposed to send these automatically or let you know when they are available for digital download, but sometimes you have to contact them). How did I know what Schedules I needed? The digital version of the prior year’s filing included the Schedules and the contact information of the entity and person who prepared it. The Form 5500 instructions on the DOL website also told me what info I needed and where to get it
  • I copied the information from the previous year's Form 5500, and added the updated participant count and dollar values; but mostly I copied
  • I wrote a procedure for everything I did and stapled it to the front of the folder I kept the full copies of the filing in. My instructions included how to register for freeerisa.com and gain access to previous filings

And now the next novice who has to perform this task can imitate what I did. And hopefully they'll learn something also.

Resources: Free online Form 5500 filing databases:

freeerisa.benefitspro.com
http://www.brightscope.com (retirement plans only - type in the name of the company or plan to access the Form 5500 tab)
efast.dol.gov (choose the Form 5500/Form 5500-SF search link)

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