The Punxsutawney Spirit

Auditor general releases findings for Eldred Twp. pension plan

- By Matthew Triponey Of The Spirit

Pe n n s y l v a n i a Auditor General Timothy L. DeFoor released audit reports for 34 municipal pension plans in 15 counties on Monday, including Jefferson, where his office studied Eldred Township’s non-uniformed pension plan.

The report said that “in all significan­t respects,” Eldred Township’s plan was in compliance with state laws, regulation­s, contracts and administra­tive procedures, as well as local ordinances and policies, with one exception: inadequate accounting and reporting of the activity of the pension plan.

The auditor general’s report said the township’s account/reporting system “did not provide effective control over the transactio­nal activity of the pension plan during the year 2020.” Municipal officials were unable to provide annual financial or custodial account statements summarizin­g financial activity.

According to the report, the cause of this was that the municipal government did not maintain separate, detailed accounting of pension plan transactio­ns. It said the plan’s custodian failed to provide copies of transactio­n statements summarizin­g the account’s activity in 2020.

Auditors learned that a substantia­l software upgrade, the implementa­tion of a new accounting system and the COVID-19 pandemic resulted in unforeseen delays in the year-end reporting process.

At the time of the audit, the township had already taken active measures to resolve the issues. It is anticipate­d that reports will be up to date by the end of the year.

The auditor general’s office was able to obtain alternate documentat­ion backing up the transactio­ns that were tested; however, the report indicated the absence of financial and account transactio­n statements makes it harder for municipal officials to monitor operations, and opens the possibilit­y of undetected errors or impropriet­y.

Municipal officials agreed with the finding without exception.

The audit covered the period of Jan. 1, 2017, through Dec. 31, 2020. The auditor general is required to audit municipali­ties that receive general municipal pension system state aid.

Key points of the audit included:

• Whether state aid was properly determined and deposited;

• Whether annual employer contributi­ons aligned with the plan’s governing document and applicable laws and regulation­s;

• That there were no employee contributi­ons required by the governing document or laws and regulation­s;

• Whether retirement benefits were properly determined and disbursed;

• Whether actuarial valuation reports were submitted accurately and in a timely fashion.

The auditor general’s office will evaluate whether the township is in compliance with its recommenda­tions during the next audit of the plan. In a news release, DeFoor thanked township officials for their cooperatio­n while the audit was conducted.

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