Why Choose McLane Advisors
McLane Advisors brings a three-generation Texas legacy to corporate retirement planning, including Safe Harbor 401(k) guidance. Our disciplined approach helps business owners keep plan strategy and long-term goals organized while coordinating with TPAs, recordkeepers, ERISA professionals, and independent auditors.
Know When an Audit May Apply
For defined contribution plans, the Form 5500 participant-counting method changed beginning with the 2023 plan year. Generally, the small-plan threshold now looks at participants with account balances at the beginning of the plan year, not every employee who is merely eligible to participate.
Plans at or above the large-plan threshold generally need an annual employee benefit plan audit with Form 5500, but the 80-120 participant rule can affect how some plans near the threshold file from year to year. Your administrator or qualified plan professional should confirm the rule that applies to your plan.
401k Audit Roles at a Glance
| Role | Primary Responsibility |
|---|---|
| Plan sponsor/ administrator | Determine filing obligations, engage the auditor, maintain records, and oversee the plan. |
| Independent qualified public accountant | Perform the ERISA audit and issue the auditor report required with the Form 5500 filing. |
| TPA / recordkeeper | Provide plan administration, participant, transaction, and recordkeeping data within its scope. |
| McLane Advisors | Provide retirement-plan and investment guidance within its advisory role; not the independent audit opinion. |
Who Performs the Required 401k Audit?
Federal law requires a plan administrator that needs an ERISA audit to hire an independent qualified public accountant. The auditor must be licensed or certified as a public accountant by a state regulatory authority and must meet ERISA independence requirements. McLane Advisors should not be presented as the CPA audit firm.
Where McLane Can Add Value
McLane's public services focus on corporate retirement planning, Safe Harbor 401(k) plans, rollovers, investment guidance, and long-term financial strategy. During an audit year, McLane can help keep plan decisions in context while the independent auditor, recordkeeper, TPA, and ERISA professionals handle their specialized roles.
- Review retirement-plan goals and design questions within McLane's advisory scope
- Keep investment and fiduciary discussions connected to the broader business plan
- Help identify questions that belong with the TPA, recordkeeper, ERISA counsel, or independent CPA
- Support long-term plan strategy after the audit process is complete
Frequently Asked Questions
Federal law generally requires large employee benefit plans to include an independent audit report with the Form 5500 filing. For defined contribution plans, beginning with the 2023 plan year, the small-plan participant count generally focuses on participants with account balances at the beginning of the plan year.
A plan at or above the large-plan threshold may therefore need an audit, subject to rules such as the 80-120 participant transition rule. The determination is more nuanced than simply counting every employee who is eligible to participate. Your plan administrator, TPA, or qualified ERISA professional should confirm the filing status each year.
The Department of Labor changed the participant-counting methodology used to determine whether a defined contribution plan can file as a small plan. Instead of counting all eligible participants for this purpose, the plan generally counts participants with account balances at the beginning of the plan year.
This change can reduce the number of plans that cross into large-plan audit status. The 80-120 participant rule can still matter for plans near the threshold. Because filing status affects whether an audit is required, use the current Form 5500 instructions rather than an older rule-of-thumb.
The 80-120 rule is a filing consistency rule for plans near the small-plan and large-plan boundary. In general, if a plan has between 80 and 120 participants at the beginning of the plan year, it may be able to file in the same category it used the prior year, assuming the applicable conditions are met.
That can affect whether the plan needs a large-plan audit in a particular year. The rule is not a permanent exemption and does not replace the current participant-counting methodology. A plan professional should confirm how it applies to your facts.
No. A required ERISA plan audit must be performed by an independent qualified public accountant, and McLane Advisors' current public website does not identify the firm as a CPA audit practice. If you are searching for Houston 401k auditors, look for an accountant with employee benefit plan audit experience and the required independence.
Those Houston 401k auditors should be separate from McLane's retirement-planning and investment-advisory role. The independent auditor issues the audit opinion. Keeping those roles separate protects the integrity of the audit process.
In the strict ERISA sense, 401k audit services are independent assurance services performed by a qualified public accountant on the plan's financial statements and required supplemental information. The auditor may test areas such as contributions, benefit payments, participant accounts, plan investments, and compliance-related transactions as part of the audit. The audit itself belongs to the independent accountant.
An ERISA Section 103(a)(3)(C) audit is the current term for what was historically called a limited-scope employee benefit plan audit. The plan administrator may elect this approach when a qualified institution provides a proper certification for certain investment information.
The auditor still performs an ERISA plan audit under current professional standards; the election changes how certified investment information is handled. It does not mean the auditor skips the rest of the audit. Your independent CPA should explain whether the election is available and appropriate for your plan.
The independent auditor typically requests plan documents and amendments, participant census information, payroll and contribution data, distributions, loans, investment or trust information, prior Form 5500 filings, and other records relevant to the plan's financial statements.
The exact request varies by the plan and by the auditor's approach. Good record organization can make the process more efficient, but completeness matters more than simply moving quickly. Your TPA and recordkeeper may hold much of the requested information. The auditor should provide the formal request list for the engagement.
A Form 5500 filing that requires an audit can be considered incomplete if the proper auditor report is missing or deficient, and that can lead to regulatory correspondence or penalties. The Department of Labor emphasizes that selecting an experienced, independent employee benefit plan auditor is an important plan-administrator responsibility.
If you discover a problem, involve the auditor, TPA, ERISA counsel, and other appropriate professionals promptly. The solution depends on what is missing and whether the filing has already been submitted. Do not rely on a marketing page to diagnose a filing correction.
Audit fees and timelines are set by the independent CPA firm, not by McLane Advisors, and they vary with plan size, complexity, record quality, service-provider responsiveness, and the type of audit engagement. A clean, organized plan can be easier to audit than one with missing records or unresolved transactions.
Ask prospective auditors for a written engagement letter that explains scope, timing, fees, and responsibilities. Build enough time into the Form 5500 calendar for questions and follow-up. McLane can separately discuss retirement-plan planning needs within its own advisory scope.
McLane can help you keep the retirement-plan strategy connected to your broader business and employee-benefit goals. The firm's current services include corporate retirement planning and Safe Harbor 401(k) plan guidance, which can be useful as a plan grows and becomes more complex.
For 401k audit requirements, however, the formal determination and audit work should be handled by the plan administrator and appropriate TPA, ERISA, and independent accounting professionals. McLane can participate in conversations that fall within its advisory role. Start early enough to identify who is responsible for each part of the process.
Federal law generally requires large employee benefit plans to include an independent audit report with the Form 5500 filing. For defined contribution plans, beginning with the 2023 plan year, the small-plan participant count generally focuses on participants with account balances at the beginning of the plan year.
A plan at or above the large-plan threshold may therefore need an audit, subject to rules such as the 80-120 participant transition rule. The determination is more nuanced than simply counting every employee who is eligible to participate. Your plan administrator, TPA, or qualified ERISA professional should confirm the filing status each year.
The Department of Labor changed the participant-counting methodology used to determine whether a defined contribution plan can file as a small plan. Instead of counting all eligible participants for this purpose, the plan generally counts participants with account balances at the beginning of the plan year.
This change can reduce the number of plans that cross into large-plan audit status. The 80-120 participant rule can still matter for plans near the threshold. Because filing status affects whether an audit is required, use the current Form 5500 instructions rather than an older rule-of-thumb.
The 80-120 rule is a filing consistency rule for plans near the small-plan and large-plan boundary. In general, if a plan has between 80 and 120 participants at the beginning of the plan year, it may be able to file in the same category it used the prior year, assuming the applicable conditions are met.
That can affect whether the plan needs a large-plan audit in a particular year. The rule is not a permanent exemption and does not replace the current participant-counting methodology. A plan professional should confirm how it applies to your facts.
No. A required ERISA plan audit must be performed by an independent qualified public accountant, and McLane Advisors' current public website does not identify the firm as a CPA audit practice. If you are searching for Houston 401k auditors, look for an accountant with employee benefit plan audit experience and the required independence.
Those Houston 401k auditors should be separate from McLane's retirement-planning and investment-advisory role. The independent auditor issues the audit opinion. Keeping those roles separate protects the integrity of the audit process.
In the strict ERISA sense, 401k audit services are independent assurance services performed by a qualified public accountant on the plan's financial statements and required supplemental information. The auditor may test areas such as contributions, benefit payments, participant accounts, plan investments, and compliance-related transactions as part of the audit. The audit itself belongs to the independent accountant.
An ERISA Section 103(a)(3)(C) audit is the current term for what was historically called a limited-scope employee benefit plan audit. The plan administrator may elect this approach when a qualified institution provides a proper certification for certain investment information.
The auditor still performs an ERISA plan audit under current professional standards; the election changes how certified investment information is handled. It does not mean the auditor skips the rest of the audit. Your independent CPA should explain whether the election is available and appropriate for your plan.
The independent auditor typically requests plan documents and amendments, participant census information, payroll and contribution data, distributions, loans, investment or trust information, prior Form 5500 filings, and other records relevant to the plan's financial statements.
The exact request varies by the plan and by the auditor's approach. Good record organization can make the process more efficient, but completeness matters more than simply moving quickly. Your TPA and recordkeeper may hold much of the requested information. The auditor should provide the formal request list for the engagement.
A Form 5500 filing that requires an audit can be considered incomplete if the proper auditor report is missing or deficient, and that can lead to regulatory correspondence or penalties. The Department of Labor emphasizes that selecting an experienced, independent employee benefit plan auditor is an important plan-administrator responsibility.
If you discover a problem, involve the auditor, TPA, ERISA counsel, and other appropriate professionals promptly. The solution depends on what is missing and whether the filing has already been submitted. Do not rely on a marketing page to diagnose a filing correction.
Audit fees and timelines are set by the independent CPA firm, not by McLane Advisors, and they vary with plan size, complexity, record quality, service-provider responsiveness, and the type of audit engagement. A clean, organized plan can be easier to audit than one with missing records or unresolved transactions.
Ask prospective auditors for a written engagement letter that explains scope, timing, fees, and responsibilities. Build enough time into the Form 5500 calendar for questions and follow-up. McLane can separately discuss retirement-plan planning needs within its own advisory scope.
McLane can help you keep the retirement-plan strategy connected to your broader business and employee-benefit goals. The firm's current services include corporate retirement planning and Safe Harbor 401(k) plan guidance, which can be useful as a plan grows and becomes more complex.
For 401k audit requirements, however, the formal determination and audit work should be handled by the plan administrator and appropriate TPA, ERISA, and independent accounting professionals. McLane can participate in conversations that fall within its advisory role. Start early enough to identify who is responsible for each part of the process.
Make Audit Readiness Part of Better Plan Governance
A growing retirement plan can bring new responsibilities, and clarity about roles matters. McLane Advisors can help keep your corporate retirement strategy focused while qualified administrators, ERISA professionals, recordkeepers, and independent accountants handle the specialized compliance and audit work their roles require.
Need guidance around 401k audit requirements and your broader retirement-plan strategy? Contact McLane Advisors in Montgomery to schedule a consultation and start organizing the right professional team.
