Investigative Plan

EBSA Case # 22-015241

1. Subject:

Cooley and Associates PLC-401 K (Plan)

PO BOX 7967

Charlottesville, VA 22906

Phone- (434)-975-2663

2. Predication:

Information received from the Plan asset custodian1 indicated the possibility of late employer contributions being remitted to the plan. Case was opened by investigator (Yvette Fisher) on or around January 16, 2014. Notes in the case file indicate that the Plan officials were contacted about this allegation. Additionally, the case file indicated that the plan officials appear to not have taken any corrective actions to remedy this allegation.

3. Background / Financial Operations:

The annual report 5500 - 2012 (latest in the case file), indicates that the plan has 8 participants with total assets - $359,748. The 5500 was electronically signed by Gregory J. Cooley as the Plan Administrator on 10/11/2103. Effective date of plan 4/1/2005. Part V of the 5500 indicates the following other areas of interest:

Participant loans totaling $24,219 Plan financial statements indicate benefits paid of $131,278

4. Audit / Investigative activity to date:

Examination of case file to determine any prior work efforts disclosed the following:

1/16/2014 - Letter from Yvette Fisher (Investigator) informing the Plan Administrator that the plan operations have been scheduled for an investigation and requested plan records.

Letter (no date appears to be listed) from Amy Duru (Benefit Advisor) to Plan Administration requesting financial records including trust reports. Notation in case file indicates that this was the second notification from the WDO.

7/24/2013 - Letter from Deidra Koger (Supervisory, Benefit Advisor) to Plan Administrator requesting information about employer contributions documentation, payments received. \

1 The correspondence was dated 7/10/2013 from David L. Ramussen- Trust Officer and Vice President FRONTIER Trust Company. Note: the referral requests confidentiality. Phone (701)-234-0207

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3/25/2014 note in case file indicated that investigator (Fisher) in a conversation with plan administrator extended the time to produce the requested documents to April 22, 2014.

5. Objectives:

1. Establish that the plan is a covered plan subject to ERISA regulations / provisions.2. Determine if there are employer ( e.g. Plan sponsor) employer contributions are late or have

been late

6. Procedures to accomplish objectives (off site and on site)

1. Review WDO office case files to determine if any other activity on the subject.2. Interview the plan officials; inquire about roles and responsibilities with respect to the

operation of the plan.3. Obtain plan documents - review / summarize key areas.4. Determine that the plan is covered by a fidelity bond that the premium payments are current,

and the actual bond is in compliance with the ERISA provisions (e.g. no deductible).5. For a selected period review cash receipts for the plan, document employer contributions

received. Ascertain if the contributions have been timely.6. Obtain income tax filing of the employer ( plan sponsor) agree the contributions reported as

being made to the plan are the same as those reported by the plan as being received. Investigate any variances.

7. Review the plan document provisions for participant loans (plan filing indicated $24,219 in loans) be aware of key issues (e.g. reasonable rate of interest, adequately secured, availability).

8. Examine cash disbursement records of the plan (e.g. journals, checks, wire transfers) for possible non - compliance issues (e.g. party in interest transactions).

9. Inquire / document the process for handling disbursements from the plan. Ascertain if existing internal controls are adequate and plan assets are properly safeguarded.

10. On a test basis sample a group of the total benefits paid (plan filing indicated $131,278). Determine that the plan cash disbursement records agree with plan filing totals. Additionally, determine that the individuals that received these benefit payments are/ were participants and entitled to receipt of benefit payments, investigate any differences.

11. Interview Mr. David L. Rasmussen (officer from Frontier Trust- sent in the referral). Inquire what caused him to make referral and other concerns and background information he may have and is willing to share this information.

12. Ascertain all related parties to the plan - document this process (e.g. interview, examination of filings, service provider agreements / contracts.

13. Obtain listing of all service providers and related company officers.14. If find the existence of possible violations of ERISA - establish elements of proof, document the

activity or alleged violation.

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15. Convene exit brief meeting with Plan officials present preliminary issues (if any); solicit opinion of these individuals and present proposed corrective actions.

Note: need to stress to these individuals these auditors’ issues are just preliminary and could be subject to revision based on review by WDO management

7. Post field work:

1. Prepare written executive briefing for WDO management , present issues and proposed corrective actions ( if any)

2. Obtain agreement or disagreement with proposed actions; revise as needed write Report of Investigation (draft) for final review. Incorporate adjustments received from the review and issue appropriate notice letter (e.g. voluntary compliance, closing letter etc.) under Regional Administrator’s signature, to plan officials

3. Write Report of Investigation, assemble case file / work papers (e.g. index and cross reference)

8. Monitor actions follow-up:

1. Conduct necessary follow-up activities with Plan officials to obtain documentation to support corrective actions have been initiated, proposed, or completed. Document the process, when information is received examine to support corrective action

2. Issue closing letter to Plan officials, under Regional Administrator’s signature

Estimated number of workdays to complete investigation _______

Included in this estimate approximately 2 days travel time

Status reports of activity to be filed weekly

Prepared by:

Gerard J. Sheeran, Auditor ________________________ Date __________________

Approved by:

Elizabeth Bond, Supervisory Investigator ________________________Date __________________

File: Investigative Plan Cooley and Associates (desktop)

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