January 25, 2017
On October 20, 2016, the Society of Actuaries released the 2016 mortality improvement scale for pension plans (MP-2016 scale). Plan sponsors should work with their actuaries to ensure they are using the most up-to-date mortality tables available. In the case of a beginning of year valuation date, data will need to be gathered to determine the impact on the valuation performed as of December 31, 2015, as part of the 2016 plan year audit. Refer to this document for additional information.
It's open season for Internal Revenue Service audits right now, and one hot button issue auditors are currently focusing on is unsigned plan documents. The IRS specifically asks for signed plan documents (including amendments) as part of their checklist when they begin an audit. We recommend plan sponsors retain a plan fiduciary file with all signed plan documents and amendments going back to plan inception if possible. The IRS publishes a list of required amendments each year, and we recommend plan fiduciaries review this document annually to ensure all required amendments have been adopted.