The Punxsutawney Spirit
Auditor general releases findings for Eldred Twp. pension plan
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.