Benefit Plan Funds Should Have a Collections Policy for Payroll AuditsBondBeebe
Posting by Ron Chandler, CPA
I recently have encountered various types of benefit plan funds that do not have a credit or over-payment policy for payroll audits or for collections in general. I recommend that all funds have a collections policy and include credits and over-payments in that policy. Some funds within the construction industry do not allow credits for vacation, 401k or define contribution plans, but allow credits for health and welfare and defined pension plans within some time period guidelines. I know of a health and welfare fund that gives credit for the over-reported hours, but charges a “Damage Formula”, which includes premium costs and administrative charges.
If your benefit plan does not have a specific credit or over-payment policy, consult your fund counsel, administrator, consultant and auditor for guidance on developing one.