Question: The City of Acton maintains a de ned contribution pension plan
The City of Acton maintains a deﬁned contribution pension plan for its employees. Employees contribute 6 percent of their salaries; the city contributes 8 percent. The city has ﬁduciary duty for the plan, but outsources its management to a well-known private annuity company. The city deducts the employee contributions from paychecks and each month sends the annuity company a check representing the amounts deducted plus the city’s match. The annuity company handles all correspondence with both employees and retirees, and makes the beneﬁt payments to the retirees. Each month its ends the city are port of transactions and balances. Should the plan be accounted for as a ﬁduciary fund, just as if the city managed the fund itself?
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