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
October 5, 2010
Russell J. McNiff, Chairperson
Holyoke Retirement Board
20 Korean Veterans Plaza
Holyoke, MA 01040
REFERENCE: Report of the Examination of the Holyoke Retirement Board for the three-year period from January 1, 2006 through December 31, 2008
Dear Chairperson McNiff:
The Public Employee Retirement Administration Commission has completed a follow-up review of the findings and recommendations contained in its audit report of the Holyoke 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 four 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 Geriatric Authority had not paid its full appropriation for FY08, FY09, or FY10.
Follow-up Result: The Geriatric Authority has made minimal payments in the past year. As of August 31, 2010 the amount owed was $275,046 before adding interest of $47,785. This issue is not resolved.
2. The Audit Report cited a two-part finding regarding cash. Part A was that the Treasurer’s reconciliation contained unexplained adjustments, and Part B was that the IRS fined the Retirement System due the Treasurer filing IRS form 945 late.
Follow-up Result: The Board has changed banks, and the new Treasurer is doing timely reconciliations, so there are no more unknown adjustments. The new Treasurer and the Retirement Board have set up a process for sending the withheld taxes to the IRS that is more efficient than the old process and will ensure that future filings are on time. Both parts A and B are resolved.
3. The Audit Report cited a finding that an investment was funded before PERAC received the required documents.
Follow-up Result: The investment cited was temporary; all the money is now with other managers. All subsequent investments have taken place after PERAC received the necessary paperwork. This issue is resolved.
4. The Audit Report cited a finding that the Retirement Board went several months without a custodian bank.
Follow-up Result: On October 22, 2009 PERAC approved a supplemental regulation allowing the Holyoke Retirement Board to invest without having a custodian. This issue is resolved.
The Commission wishes to acknowledge the effort demonstrated by the staff of the Holyoke Retirement Board to correct most of 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
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