This tool provides an overview, key risks, expected key controls and questions to consider for the flexible benefits process.
Flexible benefit plans allow employees to use pre-tax dollars pay for various expenses/benefits. These plans allow the participant to customize their benefits to fit their individual needs. There are three main types of flexible benefit accounts: premium conversion plans/premium only plans (POP), flexible spending accounts (medical care and dependent care), and cafeteria plans. POPs allow the employee to take out a designated amount to pay their share of group insurance premiums. Employees’ insurance premiums are taken out of their pay before taxes are deducted.