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HMI is one of the nation’s largest and most experienced providers of financial and compliance auditing services for employee-benefit plans. We have worked with employers as well as local and international labor unions in more than 20 industries. HMI clients include organizations with employee benefit plans that serve from 200 to 80,000 participants and whose net assets range from $100,000 to $4 billion.
HMI directors sit on the boards of the leading employee benefits regulatory bodies, including the American Institute of Certified Public Accountants Employee Benefit Plans Committee. Through staff specialists dedicated solely to employee benefit plans – one group that focuses on financial auditing, the other on compliance auditing – we excel in addressing the most complex employee benefit accounting and compliance issues.
HMI is affiliated with the International Association of Employee Benefit Plans.
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Compliance Auditing
Analysis of Collective Bargaining and Trust Agreements
Detection of Contract Fraud
Determination of Employer Contribution Compliance
Development of Financial Statements for Delinquencies
Computer Consulting for Plan Administrators
Expert Testimony in Connection with Delinquency Collection Financial Auditing
Audits of Employee Benefit Plans and Local Unions
Preparation of Tax Documents (Forms 5500, 990 and 199)
Preparation of Annual LM-2 Documents for International and
Local Unions
Pension Auditing
-Defined-Benefit Retirement Pensions
-Defined-Contribution Retirement
-Money Purchase
-401Ks
-Profit-sharing
-Stock Bonus
-Target Benefit
-Thrift or Savings
Health and Welfare Auditing
-Apprenticeship
-Cafeteria
-Flexible Benefit
-Legal
-Medical
-Profit Sharing
-Self-Insured Medical
-Vacation
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Pension Plans
Alaska Teamsters Pension Plan
Apartment Employees Pension Plan
Bay Area Painters of Northern California Funds
Brick Layers Funds
California Winery Workers Pension Plan
Carpenter Funds of Northern California
Cement Masons Pension Plan
Clerks and Lumber Handlers Pension Plan
Hotel and Restaurant Employees Retirement Plan
HOD Carriers #166 Trust Funds
IBEW 100 Pension Plan
IBEW 332 Pension Plans
Laborer Funds of Northern California
Oakland Restaurant Tavern Pension Plan
Operating Engineers California Annuity Plan
Operating Engineers Hawaii Annuity Plan
Operating Engineers Pension Plan
Plumbers 393 Trust Funds
Plumbers 467 Trust Funds
Retail Clerks Drug Clerks Pension Plan
Retail Clerks Specialty Stores Pension Plan
Sacramento Culinary Pension Plan
San Francisco Culinary Pension Plan
Sheet Metal 170 401(k) Plan
UFCW Funds of Northern California
UFCW Funds of Southern California Healthcare Plans
Alaska Teamsters Welfare Fund
Alaska NEA Welfare Plan
Apartment Employees Welfare Fund
Bakers 125 Welfare Fund
Bay Area Painters of Northern California Funds
Brick Layers Funds
California Health Care Industry Trust
California Association of Highway Patrolmen Funds
California Correctional Peace Officers Associations Funds
Carpenters Funds of Northern California
Cement Masons Funds
Culinary San Francisco Funds
Hawaii Roofers Trust Funds
HOD Carriers #166 Welfare Trust
Hotel & Restaurant Employees Health & Welfare Fund
IBEW Local 100 Welfare Fund
IBEW Local 332 Welfare Fund
Laborers of Northern California Funds
Northern California Soft Drink Welfare Fund
Operating Engineers California Vacation Plan
Operating Engineers Hawaii Welfare Fund
Operating Engineers Health & Welfare Fund
Operating Engineers Retiree Welfare Fund
Oakland Firefighters Trust
Plumbers 393 Welfare Fund
Plumbers 467 Welfare Fund
Public Employees Benefit Trust
Retail Clerks Non-Food Employees Welfare Fund
Sacramento Culinary Welfare Fund
Sonoma County Teachers Welfare Fund
UFCW Trust Funds of Northern California
UFCW Trust Funds of Southern California
Western Conference of Teamsters Legal Services Trust Fund
Wholesale Beer Welfare Fund
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Detection of Administrative Fraud and Audit Failure
HMI was initially contacted to investigate fraud perpetrated by an employee benefit plan administrator. The investigation identified inappropriate cash transfers from a plan’s account into the administrative account as well as payments incorrectly made to the plan for another client of the administrator. After summarizing the information and calculating lost interest on the fraudulent transactions, HMI analyzed the auditor’s records to determine why the theft had not been discovered or prevented. This process included analyzing the auditor’s work papers and providing fund counsel with a summary of specific employee benefit plan audit procedures that were insufficient. HMI also assisted the attorney in conducting depositions of the former auditor.
Trustees’ Due Diligence Investigation
HMI was engaged to provide an analysis of the due diligence of a fund’s trustees in regard to a real estate investment. Our work involved obtaining data on industry standards in order to determine the appropriateness of a single real estate investment that represented 80 percent of the fund’s total assets. HMI also helped with the identification of hidden payments to a party-in-interest and an analysis of the reasonableness of the administrator’s fees in relation to those of other trust funds of similar size and complexity.
Plan Investments Investigation and Audit Failure
HMI was contacted by another audit firm to assist in determining whether audit procedures in relation to plan investments were sufficient. Our conclusion was used to help determine the due diligence of the auditors regarding a financial statement in which the investment manager had fraudulently represented the valuation and existence of real estate and viatical investments.
Employer Hardship Determination
HMI is routinely engaged to make determinations on claims of financial hardship by employers who allege that they cannot pay contributions owed to an employee benefit plan. Our standard procedures include determining the ability of going concerns to pay contributions with existing assets and the extent of misrepresentation of financial transactions, if any. In one case, HMI’s investigation found that the employer was using a pleasure boat as a business asset, paying salaries to family members who were not working for the business, and using the employer’s equipment to build a hotel for a family member.
Violations of Employee Benefit Law
HMI assisted a class action against a plan sponsor who was using a vacation plan to circumvent the anti-“use it or lose it” laws. Our portion of the case involved determining that the plan was a sham by establishing that both the timing of the contribution and the funding levels were inappropriate.
Cost Allocation
Many of our clients’ plans are administered by salaried administrators whose costs are allocated to various related trust funds based upon an allocation methodology. HMI periodically analyzes client allocation methodologies to help ensure compliance with Department of Labor guidelines. For some funds, cost allocations can be based simply on the number of participants. More complex plans often require studies of employee time and facility/asset usage to determine appropriate allocations. HMI performs similar studies to determine appropriate fees charged by unions for administrative support functions.
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