A QPAM Exemption Audit is different than the typical audit done for financial statement purposes. The purpose of the audit, as specified in PTE 84-14, is to determine whether the QPAM is in compliance (i) with the QPAM’s written policies and procedures and (ii) with the objective requirements of the exemption.
This will be accomplished by:
- A review of the written policies and procedures adopted by the QPAM;
- A test of a representative sample of the plan’s transactions during the audit period that is sufficient in size and nature to afford the auditor a reasonable basis to determine if the QPAM is in compliance with its policies and procedures and the objective requirements of the exemption; and
- A determination as to whether the QPAM has satisfied the definition of a QPAM.
The audit must be completed within six months following the end of the plan year. For calendar year plans, the audit is due by June 30.
Following completion of the exemption audit, Ashland Partners will issue a written report to the Plan which contains the auditor's specific findings as well as a description of the steps performed by the auditor during the course of its review. In the event that Ashland Partners identifies prohibited transactions, the QPAM is required to take appropriate action to address the adverse finding.