Joseph E. Connarton, Executive Director
April 20, 2011
Mr. William R. Farmer, Chairman
Brockton Retirement Board
15 Christy's Drive
Brockton, MA 02301
REFERENCE: Report of the Examination of the Brockton Retirement Board for the two-year period from January 1, 2007 through December 31, 2008
Dear Chairman Farmer:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Brockton 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 System invested in a pooled fund in 2008 prior to submitting required paperwork to PERAC.
Follow-up Result: Seven investments have been made since 2008. In each instance the Brockton Retirement System has complied with PERAC regulations regarding prior approvals. This finding is considered resolved.
2. The Audit Report cited a finding that not all pooled fund manager’s statements are being utilized when posting fees to the general ledger. As a result, some pooled fund fees have been understated.
Follow-up Result: The Brockton Retirement System invests in twenty-nine pooled funds. Twenty-six of those funds now provide some type of detailed information reporting management and investment fees. Some funds bill directly for the fees. One fund liquidates a portion of the investment to pay for the fees. The System staff has been working to receive information from all twenty-nine funds. This finding is only partly resolved.
3. The Audit Report cited a finding that the Annuity Reserve Fund’s 2008 interest was understated by $13,896.59.
Follow-up Result: An adjusting entry, transferring the required interest from the Pension Reserve Fund to the Annuity Reserve Fund, was made in 2009. This finding is resolved.
4. The Audit Report cited a finding that not all Option C retirees had provided a copy of a marriage certificate to verify spousal status.
Follow-up Result: Retirement System Staff is now obtaining a marriage certificate from all retirement system members as proof of beneficiary status. This finding is considered resolved.
The Commission wishes to acknowledge the effort demonstrated by the staff of the Brockton 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