The Capital Accumulation Plan (CAP) Guidelines were designed to provide plan sponsors with clear standard regarding plan governance and disclosure.

The Guidelines apply to Group RRSP, DPSPs, Defined Contribution (DC) Pension Plans and Group RESPs.

For the most part, the Guidelines reflect current best practices in the industry and define the rights and responsibilities of plan sponsors and members.

3 Main Themes

1. Governance: Good plan governance includes clear communications to plan members, clearly defined rules that outline and clarify the rights and responsibilities of CAP sponsors, service providers and CAP members, and the establishment of selection and review criteria for investment options and service providers.
   
   
2. Disclosure: A primary focus is to ensure CAP members are provided with the information and assistance they need to make informed investment decisions.
   
   
3. Creation of a level playing field: Wherever possible, the Guidelines attempt to harmonize rules covering segregated funds, pooled funds, mutual funds and insurance products to ensure that there is a similar regulatory result for all CAP products and services, regardless of the regulatory regime that applies to them.

Create a Win-Win Situation – Use an Advisor

Provision of investment education and advice to plan members is a crucial part of the CAP Guidelines. A plan sponsor must provide investment information and decision-making tools to assist plan members in making informed decisions.

This responsibility can be delegated to a qualified service provider such as an independent advisor. An advisor can provide educational materials, conduct seminars and advise member on which plan options best suit their investment objectives.

Giving members access to investment advice will not only help to discharge some of your responsibilities under the Guidelines, it will make the members of the plan happy with both their plan and the plan sponsor. And that’s a win-win situation.