Commonwealth of Massachusetts | Public Employee Retirement Administration Commission
Five Middlesex Avenue, Suite 304, Somerville, MA 02145
Ph 617 666 4446 | Fax 617 628 4002 | TTY 617 591 8917 | www.mass.gov/perac
Domenic J. F. Russo, Chairman | A. Joseph DeNucci, Vice Chairman
Mary Ann Bradley | Paul V. Doane | Kenneth J. Donnelly | James M. Machado | Donald R. Marquis
Joseph E. Connarton, Executive Director
March 31, 2008
Mr. Bernard Pinsonnault, Chairman
Adams Retirement Board
Town Hall
8 Park Street
Adams, MA 01220
REFERENCE: Report of the Examination of the Adams Retirement Board for the three-year period from January 1, 2003 through December 31, 2005.
Dear Mr. Pinsonnault:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Adams Retirement Board for the most recent period referenced above. We conduct these visits as a regular part of the oversight process. They are designed to ensure the timely implementation of corrective action for the recommendations cited in that report. The results are as follows:
1. The Audit Report cited a finding that the investment selection of the American Funds EuroPacific Growth Fund - Class R3 was entered into and funded without a competitive process or any other regulatory action. This violates PERAC’s investment regulatory requirements that a Request for Proposal must be used and managers be chosen as a result of a competitive process.
Follow-up Result: The Adams Retirement Board and Boston Private Value Investors are now aware that an RFP is needed whenever a change in asset class is anticipated. The Board is also aware that PERAC’s Investment Unit must be notified if a competitive process is necessary. This issue has been resolved.
2. The Audit Report cited an issue that the Adams Retirement System lacks a uniform method of correctly receiving information from the member units for retirement deductions. The Adams Retirement System receives retirement deductions from five (5) governmental units. Payroll detail is not submitted with the retirement deductions that are withheld to allow the Board Administrator to review deduction accuracy.
Follow-up Result: The reporting formats have been changed by the governmental units to reflect a uniform method of correctly transmitting payroll information. This issue has been resolved.
3. The Audit Report noted that samples of contribution rates and 2% over $30,000 calculations revealed errors that need correction.
Follow-up Result: The errors were the result of a new payroll system in the Adams/Cheshire Regional School District. All employee contribution calculations were checked and verified and corrections made as necessary. This issue has been resolved.
The Commission wishes to acknowledge the significant effort demonstrated by the staff of the Adams Retirement Board to correct the deficiencies cited in the most recent examination of the system.
Thank you for your continued cooperation in this important matter.
Sincerely,
Joseph E. Connarton
Executive Director