p 3 actuaries you can understand 1 response to segal audit of june 30, 2005 actuarial valuation...
TRANSCRIPT
![Page 1: P 3 Actuaries you can understand 1 Response to Segal Audit of June 30, 2005 Actuarial Valuation August 16, 2006 P](https://reader036.vdocument.in/reader036/viewer/2022082713/5697bf841a28abf838c870df/html5/thumbnails/1.jpg)
1P3 Actuaries you can
understand
Response to Segal Audit of June 30, 2005
Actuarial Valuation
August 16, 2006
P
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2P3 Actuaries you can
understand
Overview
• Overall impression
• Areas of Agreement
• Issues for Discussion
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3P3 Actuaries you can
understand
Overall Impression
• Audit is a useful part of actuarial process
• Valuation results were accurate, but not perfect– Assumptions reasonable– Segal methodology produces higher
employer contribution– Questions about member contribution rates
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4P3 Actuaries you can
understand
Areas of Agreement
• Mistakes
• Process Refinements
• Reporting and Documentation
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5P3 Actuaries you can
understand
Mistakes
• Recommend adjusting with June 30, 2006 valuation– Safety retirement rates– Safety salary increase assumptions used in
calculation of member contribution rates for members with less than 8 years of service
– Vested Reciprocal Terminated Members over age 63 (55 for Safety)
– Active member death benefit
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6P3 Actuaries you can
understand
Process Refinements
• Review in next experience analysis– COLA Timing– Salary Increase Timing
• Add to information collected– Temporary Annuity Option Survivor
Continuance
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7P3 Actuaries you can
understand
Reporting and Documentation
• Add to valuation report– Average member contribution rates– Development of member COL contributions
• Reserve allocation• UAAL amortization• Explanation of process
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8P3 Actuaries you can
understand
Reporting and Documentation
• Minimum Amortization under GASB Statement 27– Fixed in June 30, 2005 actuarial valuation
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9P3 Actuaries you can
understand
Issues for Discussion
• Member Contribution Rates
• Cost Allocation
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10P3 Actuaries you can
understand
Member Contribution Rates
• Regular Basic – OK
• Regular COL– Question about UAAL
• Settlement Basic – OK
• Settlement COL– Question about UAAL– Question about estimating UAAL
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11P3 Actuaries you can
understand
Cost Allocation
• Both approaches calculate costs based on current membership
•P3 approach assumes contributions for all
employees there at beginning of each year.
• Segal approach assumes contributions for all employees there at end of each year.
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12P3 Actuaries you can
understand
Questions