preceding reporting year.
If for any reason a plan does not have a complete preceding
reporting year, the amount ``handled'' by persons required to be covered
by a bond shall be estimated at the beginning of the calendar, policy or
other fiscal year, as the case may be, which would constitute either the
operating year or the reporting year of the plan, whichever shall occur
first, as follows:
(a) In the case of a plan having a previous experience year, even
though it has no preceding reporting year, the estimate of the amount to
be ``handled'' for any person required to be covered shall be based on
the experience in the previous year by applying the same standards and
criteria as in a plan which has a preceding reporting year. Similarly,
where a plan is recently established, but has had, at the time a bond is
obtained, sufficient experience to reasonably estimate a complete year's
experience for persons required to be bonded, the amount of funds to be
``handled'' shall be projected to the complete year on the basis of the
period in which the plan has had experience, unless, to the knowledge of
the plan administrator, the given period of experience is so seasonal or
unrepresentative of the complete year's experience as not to provide a
reasonable basis for projecting the estimate for the complete year.
(b) Where a plan does not have any prior experience sufficient to
allow it to estimate the amount ``handled'' in the manner outlined in
paragraph (a) of this section, the amount to be ``handled'' by the
administrators, officers and employees of the plan during the current
reporting year shall be that amount initially required to fund or set up
the plan, plus the amount of contributions required to be made under the
plan formula from any source during the current reporting year. In most
cases, the amount of contributions will be calculated by multiplying the
total yearly contribution per participant (required by the plan formula
from either employers, employees, employer organizations or any other
source) by the number of participants in the plan at the beginning of
such reporting year. In cases where the per capita contribution cannot
readily be determined, such as in the case of certain insured plans
covered by the Act, the amount of contributions shall be estimated on
the amount of insurance premiums which are actuarially estimated as
necessary to support the plan, or on such other actuarially estimated
basis as may be applicable. In the case of a newly formed profit-sharing
plan covered by the Act, if the employer establishing the plan has a
previous year of experience, the amount of contributions required by the
plan formula shall be estimated on the basis of the profits of the
previous year. The amount of the bond shall then be fixed at 10 percent
of this calculation, but
not more than $500,000. A bond for such amount shall be obtained in any
form the plan desires on all persons who are administrators, officers,
or employees of the plan and who ``handle'' funds or other property of
the plan.
