SPS is a PPP
SPS is a registered Pooled Plan Provider (PPP). As a PPP, SPS is the lead sponsor of a Pooled Employer Plan (PEP) that employers can adopt, and in which employees of the adopting employer (AE) can participate.
An employer can adopt a PEP as the first 401k plan offered by the employer or can easily merge an existing 401k into a PEP.
SPS is the PEP’s lead sponsor and is responsible for the administration of the PEP in our capacity as the PPP. SPS engages the necessary services providers for the plan, effectively allowing AEs to delegate the responsibility of being the plan sponsor to SPS. The service providers of the PEP include:
- Administration/TPA (SPS)
- 3(16) Fiduciary (SPS)
- Investment Professional/Advisor
- 3(38) Fiduciary Service Provider
- Independent Qualified Public Accountant (IQPA)
Outsourcing Roles & Responsibilities
When an employer merges it’s existing 401k plan into a PEP, the employer eliminates many of the risks and responsibilities of sponsoring a 401k plan. The employer is:
- No longer the Plan Sponsor
- No longer the Trustee
- No longer the Fiduciary Plan Administrator
- No longer responsible for distributing plan notices
- No longer required to sign-off on Plan loans or distributions
- No longer required to file a 5500 for the plan
- No longer required to obtain an Annual Plan Audit from an IQPA
As an AE of an SPS PEP, the employer has a dedicated administrator assigned to handle any questions or service requests that arise. Filing annual forms, distributing participant disclosures, and completing participant distributions and loan requests become a thing of the past.
Say Goodbye to Expensive Annual Audits
An employer with more than 100 employees which merges it’s 401k plan into a PEP is no longer responsible to pay for and complete an annual audit. The requirements related to annual audits are expanding, and the fees charged by accounting firms for these required audits are rising quickly as well.
SPS engages the independent qualified public accountant for the audit for the entire PEP as the PPP.