US AUDITORS could be required to report financial irregularities in a company's employee pension funds, if proposed legislation is approved by Congress.

The Labor Department, which is investigating hundreds of companies suspected of illegally dipping into their employees' pension funds, is working closely with the American Institute of Certified Public Accountants (AICPA) to reach agreement on the language in the bill.

The legislation has been around for years in one form or another. But, even though it would increase government regulation of the work of auditors, "chances for passage are stronger now than ever before", according to Richard Steinberg, a member of the AICPA'S employee benefit plans committee and chairman of its emerging issues task force.

The proposed measure was given new life after the Labor Department found evidence of an increase in pension plan fraud. The department has civil and criminal investigations in progress against 300 companies for diverting funds from 401(k) plans, tax-deferred savings accounts set up by employers. Its caseload is at least triple what it was one year ago..... (more)

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