What it is
In an ERISA section 103(a)(3)(C) audit, the plan administrator elects not to have the auditor audit investment information a qualified institution has certified. The auditor still audits the rest of the plan’s financial statements and the supplemental schedules, and the report has a specific form that says what was and was not covered.
This template records that election, the certification the administrator must obtain, the auditor and plan administrator responsibilities (participant data, contribution timeliness, party-in-interest and prohibited transactions, service organization reports), the Form 5500 timing and the independence points. It describes the two-part form of the report so the client knows what to expect.
When to use it
- A defined contribution plan with a bank or insurance company holding and certifying its investments needs an audit with its Form 5500.
- A plan is moving from a full-scope to a limited-scope audit, or the other way, and the terms change.
- A plan administrator needs a record of the election and the certification before fieldwork starts.
What’s inside
- Objective and scope, including the election and what the auditor does and does not audit
- Auditor responsibilities: participant data, contributions, benefits, loans, party-in-interest transactions and schedules
- Plan administrator responsibilities: administration under the plan document, the certification, and the representation letter
- Reporting, Form 5500 timing and extension reference
- Independence, nonattest services, fees and signature blocks
Standard cited
This template follows AU-C 703 / ERISA 103(a)(3)(C). It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use.
Questions
What does a limited-scope audit leave out?
Investment information that a qualified institution has certified as complete and accurate. The auditor obtains and reads the certification, compares it with the related information in the financial statements and reads the related disclosures, but does not audit the certified information itself, and says so in the report. All other parts of the financial statements are audited.
Who decides to use the limited-scope option?
The plan administrator. It must also be sure the institution is one the Department of Labor regulations allow, and obtain a certification that meets the regulations. The template puts that responsibility on the administrator.
Is the report a disclaimer?
No. Since SAS 136 (effective for plan periods ending on or after December 15, 2021), AU-C 703 has the auditor give an opinion in two parts: whether the amounts and disclosures not covered by the certification are presented fairly in all material respects, and whether the investment information related to the certified investment information agrees to, or is derived from, the certification. The report also has a section describing the scope and nature of the audit. As in any audit, the form of the opinion depends on the audit results.
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Last updated 11/05/2026. All free templates.