Annual Plan Review & Due Diligence Checklist

Annua l P l an Rev iew & Due Diligence Checklist

F o r Q u a l i f i e d R e t i r e m e n t P l a n F i d u c i a r i e s

®

To ensure that you are meeting your fiduciary responsibilities,

it’s a good idea to review and evaluate your plan on at least an

annual basis. An important part of this review includes docu-

menting what you review and any decisions you make.

To help you with this process, we’ve developed this sample

Fiduciary Plan Review Agenda and Checklist. (A more

detailed discussion of fiduciary responsibilities is provided in

the companion guide titled, A Guide to Fiduciary

Responsibility for Qualified Retirement Plan Fiduciaries.)

In general, as a plan sponsor of a qualified retirement plan you

are considered a “fiduciary.” Under ERISA (The Employee

Retirement Income Security Act of 1974), retirement plan

fiduciaries have certain duties they must carry out.

This guide is not intended by The Guardian Life Insurance Company of America, The GuardianInsurance & Annuity Company, Inc. (GIAC) or any of its employees or agents to be considered invest-ment, tax, or legal advice.Please consult your tax or legal advisor for guidance and information that isspecific to your plan.

As a fiduciary, documenting decisions you’ve made regarding your retire-

ment plan is an important way to show that you’ve carried out your fiduciary

responsibilities—in the event they ever come into question. It also helps to

keep you organized and streamline administration.

Here’s the information that you should keep in your due diligence file:

1. Fiduciary Plan Review Agenda — Include notes and minutes from your

annual plan review meeting. (See enclosed sample)

2. Fiduciary Checklist — Complete this at least once a year.

(See enclosed sample)

3. Investment Policy Statement — Attach investment information used to

make decisions. Document any changes, fund additions, deletions or

funds placed on watch list.

4. Plan & Trust Documents — Include any amendments.

5. Service Provider Agreements — Include proposals and contracts.

6. Liability Insurance & ERISA Bond — Include policies and other perti-

nent information.

7. Participant Communications — Include the Summary Plan Document

(SPD) and Statement of Material Modifications. Attach a record of when,

where and how they were provided to participants. You’ll want to keep

this information for at least six years.

Keeping a Record is Key

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Keeping a Record is Key

SAMPLE

Sample Fiduciary Plan Review Agenda

Meeting Date: ________________

Meeting Purpose: To review the plan objectives and standards and ensure they are being

followed and remain applicable.

To make any necessary plan changes.

Attendees: Name and title

______________________________________________________________________________________________

______________________________________________________________________________________________

______________________________________________________________________________________________

1.Confirm named and functional fiduciaries.

2. Review plan provisions to make sure they meet the company's and employees

needs.

3. Review investments in accordance with objectives and procedures established

in the plan’s Investment Policy Statement. Determine if any options are to be

added, removed or placed on a “watch list.”

4. Review compliance with ERISA Section 404(c), if applicable. Include a review

of participant communications to ensure required information is being provided.

5. Complete due diligence checklist (see attached) and file in

due diligence file.

6. Determine timing and implementation plan for any changes.

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Fiduciary Requirement

The named fiduciary mustreport at least annually to theboard on the administration ofthe plan.

ERISA requires that everyemployee benefit plan mustprovide the procedure for exe-cuting a funding policy in amanner that is consistent withthe plan’s objectives.

Maintain plan and trust docu-ments and any amendments.

Document Plan Information & Decisions

How to comply

Hold an annual review meetingand document what was dis-cussed and reviewed. Use theincluded sample agenda andchecklist as a beginning outlinefor the meeting.

Establish and follow anInvestment Policy Statement(IPS). While an IPS is notexplicitly required underERISA, the Department ofLabor has issued guidance stating that having an IPS isconsistent with the fiduciaryobligations of loyalty and prudence.

These are generally written byyour TPA.

Requiredunder 404(c)

Have you complied?

Yes No

Yes No

Yes No

404(c) offers some limitation of fiduciary liability but

has specific requirements. If you set up your plan to

comply with Section 404(c) of ERISA, you get limited

relief from fiduciary liability. With a 404(c) plan, par-

ticipants exercise independent control over their own

plan investments, which shifts the responsibility for

investment losses from the plan fiduciary to the partici-

pant. To be considered a 404(c) plan, specific require-

ments must be met. For example, participants must be

given sufficient information to make informed deci-

sions and must have a reasonable opportunity to give

investment instructions. The checklist that follows high-

lights these and other requirements of 404(c). This

checklist is not a comprehensive list of every require-

ment under ERISA Section 404(c). Please consult your

legal and/or tax advisor for more information.

To assist you in documenting that you've satisfied your

fiduciary duties, you may want to use this checklist. It

highlights many of the important fiduciary duties,

including some of those required under 404(c). The

checklist also explains how to comply and gives you a

check off box to document that you've complied with

each requirement. For further information, please con-

sult with your tax and/or legal advisor. It’s a good idea

to go through this checklist on an annual basis. Then,

be sure to keep the completed checklist in your due

diligence file. You can download additional copies of

this checklist from www.GuardianRetirement.com.

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Select & Monitor Investment Options


Maintain copies of participantcommunications and a recordof when and how they wereprovided to participants.

Maintain service provideragreements, and liability insur-ance and ERISA bonds.

Offer a broad range of invest-ment alternatives that includesat least three core investmentcategories and represents awide range of risk/return characteristics.

Review investments in accor-dance with objectives and procedures established in plans Investment PolicyStatement (IPS). Determine if any options are to be added,removed or placed on a “watchlist.”

How to comply

This includes the SPD and anychanges, pre-enrollment andenrollment materials.

This includes service providerproposals, contracts and serviceagreements, and insurance andbond policies.

Select a broad array of invest-ment options suitable for yourplan demographics. TheGuardian Insurance & AnnuityCompany, Inc. (GIAC) hascontracted with Fairway WealthManagement, LLC (Fairway) toassist in the selection of fundscurrently offered under TheGuardian Advantage. Fairwayis an independent registeredinvestment advisory firm.

Review your funds investmentperformance according to thetime frame set-up in your IPS.Fairway oversees and monitorsthe performance of the fundscurrently offered under TheGuardian Advantage. Fairwayprovides a series of compre-hensive reports and informa-tional tools that assist plansponsors in the ongoing over-sight and monitoring of fundsin their plans.

Have youcomplied?

Yes No

Yes No

Yes No

Yes No


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4

Communicate to Participants


Provide participants with aSummary Plan Description(SPD). It must be given to allcurrent participants within 120days after the plan becomessubject to the reportingrequirements of Title I ofERISA. New participants mustreceive an SPD within 90 days after becoming a participant.

Provide participants with aStatement of MaterialModifications if the plan isamended.

Provide written notice to par-ticipants that your plan intendsto qualify as an ERISASection 404(c) plan. Includean explanation that plan fidu-ciaries may be relieved offiduciary liability for losseswhich result from participantinvestment decisions.

Provide participants with thename, address and telephonenumber of the plan fiduciary(and any person designated toact on behalf of the fiduciary)from whom the participant canobtain investment information.

How to comply

An SPD is prepared by yourTPA. Distribute to employeesupon receipt.

Statements of MaterialModifications are prepared byyour TPA. Distribute to partici-pants upon receipt.

This should be included in yourplans SPD, provided by yourTPA.

This information is provided inthe SPD.

Have you complied?

Yes No

Yes No

Yes No

Yes No


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Provide participants with ageneral description of invest-ment objectives and risk andreturn characteristics of eachfund, including information onthe type and diversification ofassets in the portfolio.

Provide participants withinstructions on who to contactto give investment instructionsand specific limitations ontransferring among investmentoptions.

Provide a description of anyrestrictions, redemption feesand other transaction fees,associated with the purchase,sale or transfer of investmentoptions by participants.

Inform participants of theirright to request written confir-mation of investment changes.

How to comply

This information is provided inFund Prospectuses and AnnualReports. Enrollment Kits alsoinclude detailed fund FactSheets that provide this level ofinvestment information.

These instructions are explainedin the SPD if there are any planlevel restrictions. Fund levelrestrictions or redemption feeinformation is located in thefund prospectuses, available onwww.GuardianRetirement.com

This information is provided in the participant account section ofwww.GuardianRetirement.com.Fund prospectuses containingthis information are also avail-able on the Guardian website.

Confirmation of participant-directed investment changes areprovided to participants byGuardian. They are mailedwithin 24 hours of the transac-tion and are available in the par-ticipant account section ofwww.GuardianRetirement.comor from the toll-free 800 line,(800) 847-4015. Further invest-ment option information isavailable upon request.

Have you complied?

Yes No

Yes No

Yes No

Yes No


Communicate to Participants (Continued)

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Upon request

Disclose annual operatingexpenses.

Provide prospectuses, financialstatements and reports relatedto the investment optionsoffered in the plan.

Provide a list of assets com-prising the portfolio of eachinvestment option, includingthe value of each asset, andfor fixed rate investmentoptions, the name of the issuerof the option and its term andrate of return.

Provide information on thevalue of the shares or units inany designated investmentoption and its past and currentinvestment performance.

Provide information on thevalue of the shares or units ofdesignated investment optionsheld in the participant’saccount.

How to comply

Guardian will provide prospec-

tuses, published portfolio

listings, unit values, and

other information related to

the investment options in the

plan. This information is avail-

able in fund fact sheets,

prospectuses, and annual

reports and these materials are

available on

www.guardianretirement.com.

Paper copies are available upon

request by calling (877) 500-

2380. Daily unit prices are

available in the participant

account access section of the

website or from the toll-free

line at (877) 500-2380. Further

investment option information

is available upon request.

Have you complied?

Yes No

Yes No

Yes No

Yes No

Yes No


Communicate to Participants (Continued)

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Manage Administrative Responsibilities

How to comply

Decide on investment changetiming when writing your plandocument with your TPA. Tohelp with this requirement,Guardian’s record-keeping sys-tem accommodates transfers ona daily basis. Participants canmake changes online atwww.guardianretirement.comor via our toll-free line at

(800) 847-4015.

The Plan Sponsor and TPA,and plan auditor, if applicable,will compile the 5500 informa-tion and file with the IRS. Forplans with 80 or more eligibleparticipants (or upon request),Guardian will provide an auditpackage to your TPA or planauditor. This package consoli-dates all the information need-ed to complete the Form 5500,along with a step-by-step guidethat explains what informationis needed, and where to find iton the enclosed Guardianreports.

Your business insurance agentcan generally help you securethe coverage you need.


Give participants the opportu-nity to change their investmentoptions at least quarterly.

File an annual report and Form5500 with the IRS each year.

Obtain an ERISA fidelitybond of at least 10% of planassets for individuals who han-dle plan funds. Review insur-ance amounts to ensure ade-quate coverage.

Have you complied?

Yes No

Yes No

Yes No

Required under 404(c)

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Required under 404(c)


Arrange an independent CPAto audit the plan annually ifyour plan has more than 100participants.

Review your deferral processto ensure elective deferrals,voluntary contributions, andloan repayments are being sub-mitted on a timely basis.

Review plan expenses

Review plan documents andprovisions to make sure theycontinue to meet the company'sand employee’s needs.

How to comply

If you have over 100 partici-pants, hire an auditor to reviewyour plan on a yearly basis. Tohelp with this requirement,Guardian will provide a SAS 70Report to your auditors. TheStatement of Auditing Standards(SAS) 70, Type II is an auditingstandard established by theAmerican Institute of CertifiedPublic Accountants (AICPA).This report gives auditors adetailed accounting of the oper-ating processes and control pro-cedures GIAC has in place.

This requirement meansemployee’s money must bedeposited as soon as administra-tively feasible but no later thanthe 15th business day of themonth following the month inwhich the amounts were with-held from participant’s pay-checks. Make contributions atthe same time you do payroll.

Keep track of plan expenses.Request your broker to createan expense comparison forplans of similar size and com-plexity annually.

Update plan documents toreflect any changes made.

Have you complied?

Yes No

Yes No

Yes No

Yes No

Manage Administrative Responsibilities (Continued)

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The Guardian Advantage®

is a group variable annuity contract issued by The Guardian Insurance &Annuity Company, Inc. (GIAC), a Delaware corporation whose principal place of business is 7 Hanover Square, New York, NY 10004. GIAC is a wholly owned subsidiary of The GuardianLife Insurance Company of America, New York, NY.

Investments offered under The Guardian Advantage®

group variable annuity are not deposits orobligations of, or guaranteed or endorsed by, any bank or depository institution, nor are they federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board or any other agency. They involve risk, including possible loss of principal amount invested.

Fairway Wealth Management, LLC is not an affiliate or subsidiary of The Guardian Insurance &Annuity Company, Inc. or The Guardian Life Insurance Company of America.