Quick answer
APS Investment Management (APSIM), where Steven J. Musmanno is Chief Investment Officer, provides ERISA plan governance and independent advisory services to 401(k), 403(b) and defined benefit plans. The work includes investment policy statements, investment lineup management, risk-based model portfolios and independent fiduciary assessments for private and nonprofit plan sponsors.
Why ERISA fiduciary governance matters to plan sponsors
The Employee Retirement Income Security Act of 1974 (ERISA) sets standards for most private-sector retirement plans. Anyone who exercises discretion over a plan or its assets is generally a fiduciary and must act solely in the interest of participants and beneficiaries, act prudently, diversify plan investments, follow the plan documents, and pay only reasonable plan expenses. The U.S. Department of Labor summarizes these duties in its guide to fiduciary responsibilities.
For a business owner or a nonprofit board, the practical question is whether there is a documented, repeatable process behind every investment decision. Fiduciary governance is that process.
Services APS Investment Management provides
Investment policy statements
Working with plan sponsors to build and maintain an investment policy statement that sets out how investments are selected, monitored and replaced.
Investment lineup management
Ongoing oversight of the funds offered in a defined contribution plan, measured against the criteria in the plan’s policy.
Risk-based model portfolios
Building and managing model portfolios that give participants options organized by risk level.
Independent fiduciary assessments
Independent reviews of 401(k) and 403(b) plans for private companies and nonprofit organizations.
Plans served
- 401(k) plans sponsored by private companies, including closely held businesses
- 403(b) plans sponsored by nonprofit organizations
- Defined benefit plans, alongside the actuarial consulting and plan administration work of APS Pension & Financial Services
Not sure which defined contribution plan fits? See 401(k) vs. 403(b): what private and nonprofit employers should know.
Steven J. Musmanno’s role
As Chief Investment Officer of APSIM, Steven sets asset allocation policy and direction for the firm’s risk-based investment portfolios and leads portfolio management. He is Chairman and Chief Fiduciary of the APSIM Fiduciary Investment Committee and manages day-to-day trading and operations for the institutional fiduciary business. He holds the Accredited Investment Fiduciary Analyst (AIFA) designation, which prepares designees to assess fiduciary practices. More detail is on the investment management page.
What a fiduciary process generally includes
- Review the plan documents and current setup. Who the fiduciaries are, what the plan allows, and how decisions have been documented so far.
- Put the investment policy in writing. Selection criteria, monitoring standards and what triggers a change.
- Select and monitor investments against that policy. On a regular schedule, with written records of each review.
- Review fees for reasonableness. Using the fee disclosures that service providers are required to give plan sponsors.
- Keep records. Minutes and reports that show how and why decisions were made.
A documented process helps sponsors show that decisions were made prudently. It does not guarantee investment results or remove every fiduciary responsibility from the plan sponsor.
Key takeaways
- ERISA fiduciaries must act prudently and solely in participants’ interest, diversify investments and follow plan documents.
- APSIM provides plan governance, investment policy statements, lineup management, risk-based model portfolios and independent fiduciary assessments.
- Steven J. Musmanno chairs the APSIM Fiduciary Investment Committee as Chief Investment Officer.
Frequently asked questions
Who is considered a fiduciary of a 401(k) plan?
Generally, anyone who exercises discretionary authority over the plan’s management or assets, or who gives investment advice for a fee. That usually includes the employer that sponsors the plan and the people it appoints to make plan decisions. Read more in what it means to work with an ERISA fiduciary.
Can a plan sponsor hand off all fiduciary responsibility?
No. A sponsor can delegate certain functions to qualified professionals, but it keeps the duty to prudently select and monitor anyone it appoints.
Does APSIM work with nonprofit organizations?
Yes. APSIM conducts independent fiduciary assessments for 401(k) and 403(b) plans on behalf of both private and nonprofit plan sponsors.
Where is APS Investment Management located?
The firm is based at 1 Huntington Quadrangle in Melville, New York.