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
Auditor Suzanne M. Bump | Alan Macdonald | James M. Machado | Donald R. Marquis | Robert B. McCarthy | Gregory R. Mennis
Joseph E. Connarton, Executive Director
May 3, 2016
Thomas J. O’Brien, Chairman
Plymouth County Retirement Board
10 Cordage Park Circle
North Plymouth, MA 02360
REFERENCE: Report of the Examination of the Plymouth County Retirement Board for the three-year period from January 1, 2010 through December 31, 2012.
Dear Chairman O’Brien:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Plymouth County Retirement Board for the 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 five 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 regarding the cash reconciliation. There was an unexplained variance between the reconciled bank balance and general ledger for the system’s bank accounts, and the bank reconciliation function was completed solely by Retirement Board staff rather than the Treasurer.
Follow-up Result: A review of the reconciliation for the bank account referenced above for September 2015 reveals that the outstanding variance has been resolved. An interview with the Board Administrator indicates that the Treasurer has been reviewing the bank reconciliations prepared by board staff. The administrator presented two recent months in which the Treasurer has signed off on the reconciliations. This finding is resolved.
2. The Audit Report cited a finding that the additional 2% deduction from several units was not being calculated correctly. Additionally, there were two instances in which members who joined the system prior to 1979 were having the additional 2% deduction withheld.
Follow-up Result: Several refunds have been issued to members affected by the above noted errors. However, some refunds are still outstanding as the member units have yet to correct the issue with their payroll software.
According to the Board Administrator, these units are aware of the issue and trying to make corrections. Once the corrections to payroll are made by the units, the members will be issued refunds. This finding is partially resolved.
3. The Audit Report cited a finding that the auditor’s sample of active members contained four instances in which the member’s file was missing.
Follow-up Result: The retirement system is still lacking files on these current members. This is due in part to the fact that the retirement system has not received enrollment forms from the unit of the new members. The retirement system needs to continue their effort with the member units to ensure the necessary forms are completed by the member and received by the system. This finding is not resolved.
4. The Audit Report cited a finding that a review of the fiscal year 2013 appropriation indicated that one unit only paid $15,214.00 of the total appropriation due of $30,428.00.
Follow-up Result: An interview with the Board Administrator indicated that the above mentioned unit was being incorrectly assessed for their share of the required appropriation due to their actuarial data being incorrectly entered by the Board. This data has been adjusted and has been factored in by the actuary for all future appropriations allocated to this unit. The unit has paid all required appropriations required of them since FY 2013. This finding is resolved.
5. The Audit Report cited a finding that during the audit period the retirement system has not terminated the allowances of retirees who failed to comply with Chapter 32 Section 91A and has not collected the excess earnings from retirees who earned more than the statutory limit.
Follow-up Result: It was acknowledged by both the PERAC fraud unit and the Plymouth County Retirement Board administrator that this is an ongoing issue. This finding is not resolved.
The Commission wishes to acknowledge the effort demonstrated by the staff of the Plymouth County Retirement Board to correct some of the issues 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, and to ensure that the findings listed above have been resolved.
We anticipate your continued cooperation in resolving this important matter.
Joseph E. Connarton