The Employee Retirement Income Security Act of 1974 (ERISA) is a federal law that sets minimum standards for most voluntarily-established pension and health plans in private industry. It is in place to provide protection for individuals who participate in these plans.

As such, small businesses that offer employee benefit plans must be sure that their plans meet the requirements of ERISA. To ensure that the plans do meet ERISA requirements, the Department of Labor's Employee Benefits Security Administration (EBSA) is the agency responsible for making sure that plan audits, which are conducted by CPAs, are properly conducted. And, according to Jeff Hadden, a partner with LHD Benefit Advisors, "It's not a matter of if you're ever going to get audited; it's a matter of when."

However, a May 28 EBSA report, titled "Assessing the Quality of Employee Benefit Plan Audits," suggests that a large percentage of audits that are conducted by the CPAs hired by businesses to conduct the audits have significant deficiencies that are putting a large number of plans and participants at risk, especially those managed by small employers.