Employee Benefit Plan Audits

Sharrard, McGee & Co, PA is pleased to be the professional accounting firm that many companies trust to audit their employee benefit plans. Their confidence in our highly specialized ERISA experience and knowledge of the changing rules and regulations of the Department of Labor (DOL), Internal Revenue Service and other state and federal regulators is well-placed.

A study by the DOL revealed that nearly 40% of the audits of employee retirement plans are done incorrectly with serious consequences that may jeopardize plan assets and result in civil penalties to the plan administrator. They suggested that plan administrators evaluate the firm conducting these audits based on five quality factors. These include:

  1. The number of employee benefit plans the CPA audits and the types of plans audited:

Sharrard, McGee & Co., PA completed 33 audits of employee benefit plans for the 2017 calendar year. We audited a wide variety of plans including defined contribution, defined benefit, ESOP and health and welfare plans. We performed both limited scope audits and full scope audits for these clients.

  1. The extent of specific annual training the CPA received in auditing plans:

Sharrard, McGee & Co, PA understands that employee benefit plans are unique and have special requirements for auditing. Therefore, we currently have 9 staff members that specialize in ERISA audit work and all team members attain at least 8 hours of certified professional education specifically relating to employee benefit plan audits each year. One of our team members attends the annual American Institute of Certified Public Accountants (AICPA) conference on employee benefit plans and is the Chair of the NCACPA Employee Benefit Plan Committee.

  1. The status of the CPA's license with the applicable state board of accountancy:

Sharrard, McGee & Co, PA is licensed in North Carolina and is in good standing with our state board.

  1. Whether the CPA has been the subject of any prior DOL findings or referrals or has been referred to a state board of accountancy or the AICPA for investigation.

Sharrard, McGee & Co., PA is proud to say that we have not been the subject of any DOL findings and have not been referred to a state board of accountancy or the AICPA.

  1. Whether or not the CPA's employee benefit plan audit work has recently been reviewed by another CPA in the Peer Review process and, if so, whether such review resulted in negative finding:

 Sharrard, McGee & Co, PA had our last peer review as required – every other year. We received a clean opinion with no findings.

In addition to the items indicated by the DOL, we are also a member of the AICPA Employee Benefit Plan Audit Quality Center (EBPAQC). We have been a member since the center formed in 2004. Center members agree to be held to higher standards than other professionals, including: 

  • Designate an audit partner to have firm-wide responsibility for the quality of the firm's employee benefit plan practice:

Director Connie Laster has been designated as this partner at Sharrard, McGee & Co, PA.

  • Establish a program to ensure that all employee benefit plan audit engagement personnel possess current knowledge, appropriate to their level of involvement in the engagement and complete at least 8 hours of employee benefit plan specific CPE every 3 years:

That is the minimal amount of training required by our team.

  • A partner must participate in an annual Center-sponsored Designated Partner planning webinar on recent developments in employee benefit plan auditing each year:

Director Connie Laster and many of our managers participate in the webinars.

  • Establish and document policies and procedures specific to the firm's employee benefit plan audit practice:

We have these policies and procedures in place.

  • Establish an annual internal inspection of the employee benefit plan audits:

These inspections are performed every year by directors or managers on the employee benefit plan audit team. The inspector must be someone that was not involved in the audit team for the client chosen for inspection.

  • Make publicly available information about the most recent peer review:

This information is easily accessible.

  • Include an employee benefit plan audit in the firm's peer review:

We included an employee benefit plan audit in the most recent peer review.

  • File all necessary documents with the Center as needed:

 We have complied each year with the EBPAQC documentation requests.

Sharrard, McGee & Co, PA is committed to providing quality audits to all of clients, and our proud of our impressive track record in providing employee benefit plan audits to a growing number of business clients. Please call us to discuss your next audit.


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© Sharrard, McGee & Co, PA 2021,
1321 Long Street, High Point, NC 27262
(336) 884-0410

800 Green Valley Road, Suite 200, Greensboro, NC 27408
(336) 272-9777

E: info@smccpa.com

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