Filed Under:Your Practice, Regulatory

Is the Form 5500 worthless?

Regulators, industry agree Form 5500 needs fixing.
Regulators, industry agree Form 5500 needs fixing.

Close to 700,000 retirement plans filed a Form 5500 in 2011, representing $6 trillion in assets held by more than 130 million Americans. 

Given the form’s role as a primary tool for enforcing the Employee Retirement Income Security Act, it’s safe to say that no reporting instrument is as vital to the accounting of retirement assets. It’s also safe to say that few have much respect for it. 


More than half of the respondents said the form does not sync up with ERISA’s 408(b)(2) disclosure requirements. That means sponsors file two different forms to the Department of Labor, disclosing fees to service providers in two different ways, resulting in two different sets of data. 

Meanwhile, small plans (those with fewer than 100 participants) aren’t required to detail much about their plan’s composition. Small plans account for about 85 percent of all plans in the market. The absence of data on these plans means there’s no way to benchmark their performance, or assess what they pay in fees. And it calls into question if their compliance with ERISA can even be determined. 

Originally published on BenefitsPro. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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Nichole Morford

Nichole Morford
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