Skip Navigation or Skip to Content
Audit & Assurance

Proposed New Audit Standards for ERISA Plans

In a report released in May 2015, the Department of Labor (DOL) Employee Benefits Administration expressed concerns over the quality of employee benefit plan (EBP) audits. The Accounting Standards Board (ASB) of the American Institute of Certified Public Accountants (AICPA) and the DOL believe that auditors’ reports could be more informative and transparent about both the auditor’s role and management’s responsibilities, resulting in greater audit quality. In response to this, the ASB recently issued an Exposure Draft, “Proposed Statement on Auditing Standards (SAS), forming an Opinion and Reporting on Financial Statements of Employee Benefit Plans Subject to ERISA.” This exposure draft would apply specifically to audits of financial statements of EBPs subject to the Employee Retirement Income Security Act (ERISA). The comment period on the draft ends on August 21, 2017. If issued, the proposed standards would be effective for audits of EBP financial statements for periods ending on or after December 15, 2018.

The proposed SAS includes the form and content of the auditor’s report for an unmodified opinion, a new form of opinion when an ERISA-permitted audit scope limitation exists and reporting requirements on findings from procedures performed on specific plan provisions relating to the financial statements (either included in the auditor’s report on the ERISA plan financial statements or issued as a separate report).

Following is a summary of the more significant amendments to existing standards if the proposed SAS is issued. The amendments, intended to improve audit quality and transparency, include:

  • engagement acceptance requirements in addition to U.S. Auditing Standards – AICPA (Clarified) (AU-C) section 210;
  • new performance requirements that serve as a basis for a new reporting requirement, Report on Specific Plan Provisions Relating to the Financial Statements;
  • new required procedures when the ERISA-permitted audit scope limitation is imposed;
  • written management representations in addition to AU-C section 580;
  • considerations relating to the IRS Form 5500, which are accompanied by the EBP financial statements and auditor’s report;
  • expanded description of management’s responsibilities;
  • expanded communication on the ERISA supplemental schedules;
  • new form and content requirements of the auditor’s report when management instructs the auditor to limit the scope of the audit, as permitted by ERISA, including expanded auditor’s responsibilities relating to the certified information; and
  • required emphasis-of-matter paragraphs.

If you have questions or would like more information, please contact Marilyn Thompson at or 844.4WINDES (844.494.6337).
Payments OnlineTaxCaddy
Secure File TransferWindes Portal