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
Paul V. Doane | James M. Machado | Donald R. Marquis | Robert B. McCarthy | Gregory R. Mennis
Joseph E. Connarton, Executive Director
April 6, 2010
Richard Theroux, Chairman
Hampden County Regional Retirement Board
Agawam Corporate Center, Suite 116
67 Hunt Street
Agawam, MA 01001
REFERENCE: Report of the Examination of the Hampden County Regional Retirement Board for the three-year period from January 1, 2005 through December 31, 2007
Dear Mr. Theroux:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Hampden County Regional 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 two 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 value of assets managed by Zero Stage Capital as of December 31, 2007 could not be verified.
Follow-up Result: The last statement the Board received from Zero Stage Capital showed the asset value as of September 30, 2008. The 2009 Annual Statement is still using this figure ($144,473.74). This issue will be resolved when the Board writes off the asset in 2010.
2. The Audit Report cited a two part finding relating to system membership. Part A is that the deduction reports the Board receives from its units do not allow the accuracy of the deductions to be tested. Part B is that when someone retires there is no department head approval of salary, or that actual payroll records are not used to determine the average salary.
Follow-up Result: The Board is still receiving the same deduction reports. Part A is not resolved.
The sample of retirees reviewed all had payroll information in their folders. The payroll records had calculator tapes attached, plus a large amount of handwritten notes and highlighted amounts. They are using these payrolls to determine a member’s high three-year average salary. Part B is resolved.
The Commission wishes to acknowledge the significant effort demonstrated by the staff of the Hampden County Regional Retirement Board to correct the deficiencies cited in the most recent examination of the system. PERAC auditors may conduct an additional follow-up visit to ensure appropriate progress is being made in the area that has not been corrected adequately at this time.
We anticipate your continued cooperation in resolving this important matter.
Sincerely,
Joseph E. Connarton
Executive Director