UPDATED: ‘Deficiency in Controls’ Over State Pension Reporting

UPDATED: ‘Deficiency in Controls’ Over State Pension Reporting

A new report warns that the state retirement system could be making errors on its financial statements—without stopping, catching, or correcting them on time.

The system has a “deficiency in controls” according to a report by the Office of the Auditor General, which was released today.

The deficiency creates a “higher likelihood” that an error could occur and not be prevented, according to a Statehouse news release. The report is based on the annual audit of the retirement system’s financial statements for the fiscal year that ended June 30, 2010. That audit was completed December 2010.

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The report, which can be found online here, comes on the heels of news that the SEC is investigating the state pension fund. The state is also facing an estimated $5 billion unfunded pension liability.

In a statement, General Treasurer Gina Raimondo agreed there is room for improvement.

“Upon examining my first ERSRI audit, there is no question that there is room for operational upgrades," Raimondo said. "With only two months in office, I am working to fully assess how to improve the ERSRI functions that I have inherited to ensure its overall health and sustainability. Despite these technical findings, I thank the ERSRI staff for their dedication in helping members and retirees navigate this complex system.”

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