What Is a Risk Assessment Report?

Fiduciary Assessment Reports

The FIRE System Fiduciary Assessment Reports provide a Plan Fiduciary with their fiduciary risk level and identify issues they may have. On our enhanced reports, the plan fiduciary is provided with answer by answer issues and/or solutions for each compliance problem that is identified and suggestions on how to correct them—many issues fall on them to correct with your help.

The FIRE System’s Fiduciary Assessment Reports can serve as a compliance checklist and education tool to find, fix and prevent fiduciary compliance issues that may lead to fines, penalties, or lawsuits.

Per DOL FAB 2007-01, "With regard to the prudent selection of service providers generally, the Department has indicated that a fiduciary should engage in an objective process that is designed to elicit information necessary to assess the providers qualifications, quality of services offered and reasonableness of fees charged for the service. The process also must avoid self dealing, conflicts of interest or other improper influence.."

Why Are They Important?

Department of Labor and IRS regulations under ERISA have over 700 pages and over 3,800 regulations. Add in the court cases and best practices that define what a Plan Sponsor of a plan must know and practice daily, it is nearly impossible and they still have to run their business. Service providers may be good at what they do, however, their job does not include being the Plan Sponsor and making sure the plan is in compliance.

Ultimately, the Plan Sponsor is responsible for making sure all their Service Providers are doing their job and their Plan is in compliance.

The information in The FIRE System’s Fiduciary Assessment Reports can help you in working with your Plan Sponsors and other service providers or qualified independent retirement plan consultants to meet the Plan Sponsor’s fiduciary requirements, improve the plan and streamline their operations.


What Is Included With The Fiduciary Risk Assessment Report?

This one of a kind report provides the Plan Sponsors with

  1. FIRE Fiduciary Risk Level,
  2. Possible DOL and IRS Code violations,
  3. Best Practices,
  4. Solutions, and
  5. Education for each answer where it appears the the Plan Sponsor’s answers are contrary to IRS/DOL regulations, court decisions and best practices.

Fiduciary Risk Meter

These solutions can then be compared to the Plan’s daily operation (policies, procedures, and practices) to allow for implementation of the solutions to “Fix the Mistake” in the Plan and educate the fiduciaries to prevent further breaches.

This report can be used by service providers/Plan sponsors with a knowledge of ERISA in all areas.

Under ERISA's prudent-expert rule, plan sponsors must act with the skill, care and diligence of a prudent expert. This standard is well tested and affirmed in case law. In Donovan v. Cunningham, the U.S. Court of Appeals for the Fifth District said in 1983 bluntly that "a pure heart and an empty head are not enough."

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