Recommendation of Retirement Plan and Employee Benefit for a For-Profit or Non-Profit Entity Submit Assignment

In Case Study 3, you create a business or a non-profit entity; identify and explore two retirement plan solutions one “ERISA Qualifed” (such as 401k/profit sharing, defined benefit, Cash Balance, Money Purchase, SIMPLE 401k, etc) and one “non-ERISA plan” (such as a SEP or SIMPLE IRA) ) as well as one creative employee benefit, then make a recommendation to your entity.

For a quick review of options, this IRS reference (Links to an external site.) is worth reviewing.

You may wish to frame your project as a response to a RFP (Request for Proposals) by your hypothetical entity (see attachments). You may wish to review this link from the 401k Help Center. (Links to an external site.)

Your first determination should be to whether to create a Qualified Plan subject to ERISA and Department of Labor oversight, or a one of the other non-Qualfied, non-ERISA small business options not subject to Department of Labor oversight. Identify and expand upon the factors that will guide your recommendation. These may include goals of ownership to save; need for tax shelters; desire to benefit employees; age, years of employment and average salaries of the highly compensated and non-highly compensated; cash flow and growth potential of your business, etc.

As the advisor on the plan, you will identify your responsibilities. For plans subject to ERISA, discuss Fiduciary responsibilities? Are you proposing 3(21)A, or 3(38)? Demonstrate your understanding of this important distinction and how fiduciary responsibilities are impacted by each.

Provide a thorough examination of fees and expenses: broken down between Plan Administration fees, Investment Fees (including 12b-1 and/or SubTransfer Agent Fees) and Advisor Fees. Who will pay for the fees? The plan sponsor? The employees? Will the funds offset the fees? If so, how?

Discuss the fund selection process. Will you use “fund direct” bundled or unbundled product or a life insurance/ annuity product? Will the plan be “open architecture”? What share classes will be utilized? If there are 12b-1 and Sub-transfer Agent fees, how will they be administered? Will there be a “stable value” fund? What will be the Qualified Investment Default Alternative (Links to an external site.)?

For ERISA plans, how will 404(c) issues be addressed?

Discuss the impact of Regulation Best InterestPreview the document.

Finally, propose a “creative” employee benefit that all employees would value. This could be an employer paid, an employee voluntary paid, or a combination.

Present your proposal as if you were taking your recommendations to a board of directors or a selection committee.

As in the previous Case Studies, interaction and collaboration is an integral aspect of the project. However, in this Case, there will be two “groups” or “cohorts”: those who choose to develop a non-profit/government entity and those who wish to develop a “for profit” entity. So as to get insight on the differences between plans for “non-Profits” and “for-Profits”,

Phase 3 – Evaluating and recommending
Phase 3 – Evaluating and recommending
Criteria Ratings Pts
This criterion is linked to a Learning Outcome Development and Retirement Plan Recommendation for Hypothetical Business or Non- Profit Retirement Plan Case Study
50.0 pts
Outstanding Above Average
Extensive development of hypothetical business or non- profit retirement plan. Exploration of two solutions with a final recommendation of one. Solicits feedback from instructor. Compares and Contrasts advantages/disadvantages of each. Identification of 404(c) responsibilities (if any) and strategies to meet fiduciary requirements (if necessary). Discusses implications of Regulation Best Interest. Breakdown and justification of plan costs, including, plan administration, investment and individual service fees. Creative, complex, original yet realistic. Shares reflection on learning through the activity.
44.0 pts
Average
Adequate development of hypothetical business or non- profit retirement plan. Exploration of two solutions with a final recommendation of 1; Compares and Contrasts advantages/disadvantages of each. Identification of 404(c) responsibilities (if any) and strategies to meet fiduciary requirements (if necessary). Breakdown and justification of plan costs, including, plan administration, investment and individual service fees. Creative, complex, original yet realistic.
39.0 pts
Minimally Adequate
Basic development of hypothetical business or non- profit retirement plan. Exploration of only 1 solution and 1 recommendation. No Identification of 404(c) responsibilities (if any) and/or strategies to meet fiduciary requirements (if necessary). No breakdown and nor justification of plan costs, including, plan administration, investment and individual service fees. Not creative. Not original. Not realistic.
34.0 pts
Inadequate
Inadequate development of hypothetical business or non- profit retirement plan. Exploration of 1 solution. No Identification of 404(c) responsibilities (if any) and/or strategies to meet fiduciary requirements (if necessary). No breakdown and nor justification of plan costs, including, plan administration, investment and individual service fees. Not creative. Not original. Not realistic.
50.0 pts
This criterion is linked to a Learning Outcome Assumptions
25.0 pts
Outstanding Above Average
Assumptions reflect detail and depth of understanding of the complexities of retirement plan selection for a business or non-profit. They provide a solid foundation for development of a valid, realistic Case Study. Creative, yet realistic.
21.0 pts
Average
Assumptions reflect adequate understanding of the complexities of retirement plan selection for a business or non-profit. They provide a solid foundation for development of a valid, realistic Case Study.
17.0 pts
Minimally Adequate
Assumptions reflect basic understanding of the complexities of retirement plan selection for a business or non-profit. They provide a solid foundation for development of a valid, realistic Case Study.
14.0 pts
Inadequate
Lack of effort, detail and/or understanding
25.0 pts
This criterion is linked to a Learning Outcome Collaboration
15.0 pts
Outstanding Above Average
Evidence of interaction with classmates. At least 6 timely comments on the productions of others and/or responses on comments made on your project. Comments on the drafts in “other” group.
12.0 pts
Average
Evidence of interaction with classmates. At least 4 comments on the productions of others and/or responses on comments made on your project. Fails to comment on the posts from the “other” group.
9.0 pts
Minimally Adequate
Evidence of minimal interaction with the “business/non-profit” Case Study team.
5.0 pts
7
No evidence of interaction.
15.0 pts
This criterion is linked to a Learning Outcome Written Presentation
10.0 pts
Outstanding Above Average
Publishable quality; organization, mechanics and writing style are excellent. Clear Introduction, Body and Conclusion. Summary of charts/tables in narrative with reference to Appendix for detail. Proper APA format and referencing. Paragraphs exceptionally organized with one topic/point per paragraph. Completed by due date.
8.0 pts
Average
Well-written document with few edits needed. Clear Introduction, Body and Conclusion. Paragraphs well organized with one topic/point per paragraph. Summary of charts/tables in narrative with reference to Appendix for detail. Proper use of APA format and referencing.
7.0 pts
Minimally Adequate
Problems with writing and organization. Improper referencing. No clear Introduction, Body and Conclusion. Over-reliance of charts/tables in the narrative instead of an Appendix. Inappropriate use of citations. Run-on paragraphs will multiple points/topics.
6.0 pts
Inadequate
Document is poorly constructed.Numerous errors. No documentation of references. Fails to support recommendations. Not reflective of graduate level writing.
10.0 pts