7¡¢Changing Employees: Includes enrollment of new participants in the plan as well as the dismissal of members. At the time a new member is enrolled, a new individual account may be added, or, an already existent individual account may be transferred from another annuity plan. If a member is dismissed, his/her account may be reserved, or transferred to another annuity plan with the respective person¡¯s new employer. A change in employees is closely related to a general change of personnel of a client.

8¡¢Transferring/ Terminating an EA Plan: Transferring means that the occupational annuity plan as a whole, including information and interests of both, enterprise and participants, is transferred from the former plan manager to a newly appointed plan manager. Terminating a plan means that the enterprise, after terminating its business operations because of various reasons, does not make further contributions. In this case the plan will be continued to be managed, especially when it comes to the payment of benefits.

Expert¡¯s comments:

The eight procedures included into the operation of EA involve long-term cooperation of the four services provider investment manager, account administrator, custodian and trustee during all the life cycle of an annuity plan. Cooperation in so far as the interests of clients and beneficiaries are concerned ¨C this means that efficiency and accuracy become the focus of operations services. For instance, each installment of contribution is generally paid directly from the enterprise¡¯s financial department to the custody account of fiduciary property while detailed contribution data is submitted in each installment by the enterprise¡¯s personnel department. Only if the fund flow perfectly matches with the information flow this sum of annuity contribution can be imbedded into the investment asset account which the investment manager then will invest. Into this account the interests of the investment account are later paid, too, for both the corporate and individual accounts under the annuity plan. A slight problem or lag in any of these processes may well retard the actual investment of the fund and thus affect corporate and individual interests, especially if market conditions are favorable. Since the annuity fund is generally of a high amount, a delay of just one or two weeks¡¯ investment may have a noticeable effect on the investment income.

As a conclusion there can be said that an enterprise searching for an EA service provider should pay close attention to the level of cooperation with the future institution. Special care is necessary in selecting a trustee that can provide effective management, coordination and supervision duties. It is very important to represent and finally realize the interests the company pursues but also those of beneficiearies and participants in the annuity plan.