BUSINESS PROBLEM
The Internal Revenue Service (IRS) announced that the Cycle 3 restatement window would begin in August 2020 and end on July 31, 2022. As a result, preapproved Defined Contribution plans assigned to Cycle 3 had to be restated to incorporate applicable regulatory and legislative changes since the last Cycle period. Signed restatements were required by July 31, 2022.
Our Client performs recordkeeping and document services for five (5) plan providers with approximately 8,500 plans due to be restated within the Cycle 3 restatement period. The scope of restatement presented a major challenge for their existing resources and staffing models.
Our Client’s challenges included:
- The sheer volume of plans to be restated – each group coming from its own unique document platform had its own set of data challenges
- A subset of new plans required conversion into our Client’s document and recordkeeping systems during the restatement effort
- Staffing constraints with their existing plan document team, plus hiring challenges brought on by the COVID-19 pandemic
- The need for technical resources with the requisite skillset to perform a temporary, but high-volume task
- A quickly-approaching IRS restatement deadline, which was unlikely to be extended
OUR SOLUTION
EI assembled a fully remote, dynamic team with a variety of industry experiences and insights.
While the restatement period spanned two (2) years, our team was onboarded with just ten (10) months remaining to meet the deadline.
Our team’s strategic approach was to:
- Create processes and roadmaps – We interviewed our Client’s plan design team to understand relevant systems and processes, then drafted vendor-specific restatement procedures and conducted comprehensive team training
- Resolve significant challenges that arose – Processes and workarounds were created to quickly resolve challenges
- Restate all plans within the deadline, achieving an execution rate as high as 98%
- Archive and perform a Quality Review
RESULTS & CLIENT BENEFITS
EI provided a highly-customized service and delivered all restatement packages including an individualized follow-up with plan sponsors and trustees to ensure the highest possible signing rate.
We successfully created and sent all restatement packages to signers within the regulatory deadline achieving an overall signature rate as high as 98%.
Our team received positive feedback from the Client and several key stakeholders thereby enhancing the Client’s reputation and goodwill among its own customers and within the industry.
Our Client retained a repository of written and tested procedures to leverage for future projects.