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
Philip Y. Brown, Esq., Chairman
Auditor Suzanne M. Bump | Kathleen M. Fallon | Kate Fitzpatrick | James M. Machado | Robert B. McCarthy | Jennifer F. Sullivan
Joseph E. Connarton, Executive Director
March 7, 2014
Mr. Thomas A. Cangiano, Chairman
Medford Retirement Board
City Hall Room 215
Medford, MA 02155
REFERENCE: Report of the Examination of the Medford Retirement Board for the three-year period from January 1, 2009 through December 31, 2011.
Dear Chairman Cangiano:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Medford 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 examination addressed several specific findings and recommendations included in the audit report for the period referenced above. The results are as follows:
1. The Audit Report cited a finding that the Board was not formally approving monthly wire transfer transactions and that the documentation for many wire transfers was not available to support the wire transaction.
Follow-up Result: The auditor reviewed a sample of wire transfers processed in 2013 and observed proper Board approval and documented support for the transaction. This issue is resolved.
2. The Audit Report cited a finding that the Board was not reviewing and approving the monthly retiree payroll register and that there was a lack of segregation of duties for processing and distributing the monthly payroll.
Follow-up Result: Although payroll processing and payroll distribution of checks and advices have been adequately segregated, the Board has not begun the process of reviewing and approving the monthly retiree payroll register. The auditor observed that retiree payroll registers for January 2013 through January 2014 were not reviewed and approved by the Board. This issue has been partially resolved.
3. The Audit Report cited a finding that an incorrect process was used to reimburse Board members for the lost wages related to their full time City of Medford occupations.
Follow-up Result: The Board has set up a new process to correctly handle this situation. This issue is resolved.
The Commission wishes to acknowledge the effort demonstrated by the staff of the Medford Retirement Board to correct the deficiencies cited in the most recent examination of the system. PERAC auditors will conduct an additional follow-up visit to ensure appropriate progress is being made in those areas that have not been corrected adequately at this time.
We anticipate your continued cooperation in resolving this important matter.
Joseph E. Connarton