Institute Submits Model Disclosure Schedule for Plan Sponsors to DOL

Washington, DC, June 1, 2005 - The Institute has submitted to the Department of Labor (DOL) a model disclosure schedule designed to provide plan sponsors with information about "revenue sharing" arrangements that may present conflicts of interest.

Background
Mutual funds are the investment vehicle of choice for defined contribution plans, holding nearly half of all defined contribution plan assets and nearly half of all 401(k) plan assets. Mutual fund firms and their affiliates also serve as plan recordkeepers and provide other services for many defined contribution plans.

The model disclosure schedule follows up on the Institute's testimony last fall before the ERISA Advisory Council. ICI General Counsel Elizabeth Krentzman testified that "[d]isclosure to plan sponsors should enable them to meet their stringent duties as ERISA fiduciaries while disclosure to defined contribution plan participants should provide them with descriptions of all plan investment alternatives to help them make informed investment decisions."

ICI Position
In a letter to the DOL, ICI maps out the disclosure schedule, which provides information about a service provider's receipt of compensation, including revenue sharing, related to services provided to a 401(k) plan. The disclosure schedule is intended to address all service providers compensated by unaffiliated parties in connection with a plan.

Related Links
A section of the website is devoted to fund disclosure.