Client failed ADP testing. HCEs took refunds, but they weren't processed until October. HCEs had losses on their accounts, so refunded $ was actually less than original amount. Does the Employer pay the 10% excise tax on the 5330 based upon the original amount or the actual (lower) amount refunded. Any cites? Thanks in advance.

it is on the excess amount unadjusted for gains/losses.
see example under Reg 54.4979-1©(4)(iii)

Thanks Tom - I also finally found the answer in Sal's book. We have taken on a client who was in the midst of an IRS audit from 1999 & 2000, they did the refunds but didn't do them until October! We are working with the IRS agent to finish up the audit and this question had come up.