EMPLOYER PENSION REPORT STATE OF LOUISIANA MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM JUNE 30, 2014

Transcription

1 EMPLOYER PENSION REPORT STATE OF LOUISIANA MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM JUNE 30, 2014

2 STATE OF LOUISIANA MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM TABLE OF CONTENTS JUNE 30, 2014 PAGE INDEPENDENT AUDITOR'S REPORT EMPLOYER SCHEDULES: Schedule of Allocations Schedule of Pension Amounts by Notes to Schedules SUPPLEMENTARY INFORMATION: Schedule of s Proportionate Share of Contributions and Non- Contributions Schedule of Net Pension Liability Sensitivity to Change in Discount Rate Schedule of Amortization REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF EMPLOYER SCHEDULES PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS SUMMARY SCHEDULE OF FINDINGS... 37

3 WILLIAM G. STAMM, C.P.A. LINDSAY J. CALUB, C.P.A., L.L.C. GUY L. DUPLANTIER, C.P.A. MICHELLE H. CUNNINGHAM, C.P.A DENNIS W. DILLON, C.P.A. GRADY C. LLOYD, III, C.P.A. HEATHER M. JOVANOVICH, C.P.A. TERRI L. KITTO, C.P.A. MEMBERS AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SOCIETY OF LA C.P.A. S MICHAEL J. O ROURKE, C.P.A. DAVID A. BURGARD, C.P.A. CLIFFORD J. GIFFIN, Jr., CPA A.J. DUPLANTIER JR, C.P.A. ( ) FELIX J. HRAPMANN, JR, C.P.A. ( ) WILLIAM R. HOGAN, JR., CPA ( ) JAMES MAHER, JR, C.P.A. ( ) INDEPENDENT AUDITOR'S REPORT April 21, 2015 Board of Trustees of the Municipal Police Employees Retirement System 7722 Office Park Boulevard, Suite 200 Baton Rouge, Louisiana We have audited the accompanying schedule of employer allocations of the Municipal Police Employees Retirement System as of and for the year ended June 30, 2014, and the related notes. We have also audited the total for all entities of the columns titled net pension liability, total deferred outflows of resources, total deferred inflows of resources, and total pension expense included in the accompanying schedule of pension amounts by employer of Municipal Police Employees Retirement System as of and for the year ended June 30, 2014, and the related notes to the schedules. Management s Responsibility Management is responsible for the preparation and fair presentation of these schedules in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the employer schedules that are free from material misstatement, whether due to fraud or error. Auditor s Responsibility Our responsibility is to express an opinion on the schedule of employer allocations and the specified column totals included in the schedule of pension amounts by employer based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the schedule of employer allocations and specified column totals included in the schedule of pension amounts by employer are free from material misstatement Poydras Street, Suite 2100 New Orleans, LA (504) Fax (504) Old Spanish Trail Slidell, LA (985) Fax (985) Corporate Drive Houma, LA (985) Fax (985) Highway 1, P. O. Box 830 Napoleonville, LA (985) Fax (985)

4 PAGE 2 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the schedule of employer allocations and specified column totals included in the schedule of pension amounts by employer. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the schedule of employer allocations and specified column totals included in the schedule of pension amounts by employer, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the System s preparation and fair presentation of the schedule of employer allocations and specified column totals included in the schedule of pension amounts by employer in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the System s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the schedule of employer allocations and specified column totals included in the schedule of pension amounts by employer. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the schedules referred to above present fairly, in all material respects, the employer allocations and net pension liability, total deferred outflows of resources, total deferred inflows of resources, and total pension expense for the total of all participating entities for Municipal Police Employees Retirement System, as of and for the year ended June 30, 2014 in accordance with accounting principles generally accepted in the United States of America. Emphasis of Matter As disclosed in Note 6 to the schedules, the total pension liability for Municipal Police Employees Retirement System was $2,512,627,665 at June 30, The actuarial valuations were based on various assumptions made by the System s actuary. Because actual experience may differ from the assumptions used in the actuarial valuation, there is a risk that the net pension liability at June 30, 2014 could be understated or overstated. As disclosed in Note 9, deferred inflow or deferred outflow resulting from differences in contributions remitted to the System and the employer s proportionate share in addition to the amortization is not reflected in the employer pension schedules. Other Matters We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements of Municipal Police Employees Retirement System as of and for the year ended June 30, 2014, and our report thereon, dated December 12, 2014, expressed an unmodified opinion on those financial statements.

5 PAGE 3 Other Information Our audit was conducted for the purpose of forming an opinion on the employer allocations and employer pension schedules of Municipal Police Employees Retirement System. The supplementary information listed in the table of contents is presented for purposes of additional analysis and is not part of the employer pension schedules. The supplementary information is the responsibility of management and was derived from and relates directly to the underlying accounting and other records used to prepare the employer pension schedules. The information has been subjected to the auditing procedures applied in the audit of the employer pension schedules and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the employer pension schedules or to the employer pension schedules themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated April 21, 2015 on our consideration of the Municipal Police Employees Retirement System s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Municipal Police Employees Retirement System s internal control over financial reporting and compliance. Restriction on Use Our report is intended solely for the information and use of Municipal Police Employees Retirement System s management, the Board of Trustees, Municipal Police Employees Retirement System s participating employers and their auditors and is not intended to be and should not be used by anyone other than these specified parties. Duplantier, Hrapmann, Hogan & Maher, LLP New Orleans, Louisiana

6 PAGE 4 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF EMPLOYER ALLOCATIONS JUNE 30, 2014 Projected Required Combined Contributions Allocation Percentage Abbeville $ 456, % Addis 174, Alexandria 3,313, Amite 165, Arcadia 67, Arnaudville 35, Baker 520, Ball 72, Bastrop 332, Baton Rouge 15,137, Benton 86, Berwick 141, Blanchard 36, Bogalusa 806, Bossier City 3,422, Breaux Bridge 135, Brusly 77, Bunkie 46, Carencro 257, Clinton 57, Columbia 27, Cottonport 11, Coushatta 98, Covington 559, Crowley 514, Denham Springs 627, Dequincy 97, Deridder 452, Dixie Inn 24, Duson 15, Epps 1, Eunice 450, (Continued)

7 PAGE 5 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF EMPLOYER ALLOCATIONS JUNE 30, 2014 Projected Required Combined Contributions Allocation Percentage Farmerville $ 23, % Folsom 39, Franklin 105, Franklinton 334, French Settlement 13, Glenmora 11, Golden Meadow 24, Gonzales 1,004, Gramercy 62, Greenwood 138, Gretna 1,904, Grosse Tete 8, Gueydan 15, Hammond 1,699, Harahan 213, Haughton 166, Haynesville 57, Henderson 12, Hodge 11, Homer 59, Houma 1,535, Independence 17, Iowa 34, Jackson 42, Jean Lafitte 13, Jeanerette 132, Jena 39, Jennings 442, Jonesboro 30, Kenner 3,159, Kentwood 37, Kinder 104, (Continued)

8 PAGE 6 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF EMPLOYER ALLOCATIONS JUNE 30, 2014 Projected Required Combined Contributions Allocation Percentage Lafayette $ 5,431, % Lake Charles 3,115, Leesville 255, Leonville 39, Livingston 51, Livonia 99, Lockport 80, Mamou 12, Mandeville 821, Mansfield 245, Many 93, Marksville 33, Maurice 59, Mer Rouge 19, Minden 463, Monroe 3,269, Morgan City 652, Natchitoches 859, New Llano 40, New Orleans 22,883, New Roads 225, Oak Grove 57, Oakdale 142, Oberlin 31, Olla 15, Opelousas 1,060, Parks 17, Patterson 110, Pearl River 21, Pine Prairie 20, Pineville 1,030, (Continued)

9 PAGE 7 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF EMPLOYER ALLOCATIONS JUNE 30, 2014 Projected Required Combined Contributions Allocation Percentage Plain Dealing $ 17, % Plaquemine 337, Pollock 32, Ponchatoula 351, Port Allen 325, Port Vincent 11, Rayne 278, Rayville 124, Ringgold 63, Rosepine 28, Ruston 768, Sarepta 22, Scott 325, Shreveport 11,312, Slaughter 53, Slidell 1,581, Springhill 204, St. Francisville 34, St. Gabriel 288, St. Martinville 65, Sulphur 969, Sunset 19, Tallulah 119, Thibodaux 1,161, Tickfaw 30, Vidalia 285, Ville Platte 278, Vinton 132, Walker 247, Washington 33, Welsh 77, (Continued)

10 PAGE 8 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF EMPLOYER ALLOCATIONS JUNE 30, 2014 Projected Required Combined Contributions Allocation Percentage West Monroe $ 1,217, % Westlake 295, Westwego 738, Winnfield 155, Winnsboro 157, Woodworth 96, Youngsville 46, Zachary 850, Zwolle 16, Total $ 104,144, % See accompanying notes.

11 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF PENSION AMOUNTS BY EMPLOYER AS OF AND FOR THE YEAR ENDED JUNE 30, 2014 Deferred Outflows of Resources Net Pension Liability Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Outflows of Resources Abbeville $ 2,742,460 $ - $ - $ - $ - $ - Addis 1,049, , ,753 Alexandria 19,904, , ,662 Amite 991, ,348 56,348 Arcadia 402, Arnaudville 211, Baker 3,125, Baldwin Ball 435, Bastrop 2,000, Baton Rouge 90,935, , ,942 Benton 518, Berwick 849, Blanchard 219, , ,583 Bogalusa 4,844, , ,110 Bossier City 20,557, , ,494 Breaux Bridge 812, Brusly 462, Bunkie 277, Carencro 1,548, , ,624 Clinton 342, , ,192 Columbia 164, ,048 11,048 Cottonport 66, ,107 64,107 Coushatta 592, Covington 3,358, Crowley 3,090, Cullen Denham Springs 3,772, Dequincy 584, Deridder 2,716, , ,691 Dixie Inn 145, ,279 6,279 Duson 95, Epps 7, Eunice 2,708, , ,844 Farmerville 143, ,890 5,890 Folsom 237, ,227 10,227 Franklin 631, Franklinton 2,009, French Settlement 79, ,456 1,456 Glenmora 66, ,107 64,107 Golden Meadow 149, Gonzales 6,032, Gramercy 378, ,675 62,675 Greenwood 829, , ,126 Gretna 11,442, ,012,809 1,012,809 Grosse Tete 52, Gueydan 92, ,804 88,804 (Continued)

12 PAGE 9 Deferred Inflows of Resources Pension Expense (Benefit) Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Inflows of Resources Proportionate Share of Plan Pension Expense Net Amortization of Deferred Amounts from Changes in Proportion Total Pension Expense (Benefit) $ 48,234 $ 620,614 $ 742 $ 19,933 $ 689,523 $ 343,681 $ (6,645) $ 337,036 18, , , ,580 35, , ,072 4,504,309 5,386-4,859,767 2,494, ,221 2,648,596 17, , , ,219 18, ,002 7,082 91, , ,158 50,463 (45,281) 5,182 3,715 47, , ,740 26,467 (51,058) (24,591) 54, , , , ,695 (52,440) 339, ,913 36,913 - (12,304) (12,304) 7,661 98, , ,020 54,589 (76,555) (21,966) 35, , , , ,677 (51,250) 199,427 1,599,353 20,578,593 24,608-22,202,554 11,395,914 69,981 11,465,895 9, , , ,212 65,005 (18,855) 46,150 14, , , , ,397 (7,609) 98,788 3,859 49, ,572 27,497 41,194 68,691 85,204 1,096,309 1,311-1,182, , , , ,557 4,652,086 5,563-5,019,206 2,576, ,165 2,799,375 14, , , , ,832 (34,193) 67,639 8, , , ,625 57,975 (49,225) 8,750 4,889 62, , ,230 34,834 (31,121) 3,713 27, , , , , ,909 6,027 77, ,673 42, , ,345 2,887 37, ,080 20,572 3,683 24,255 1,177 15, ,345 8,390 21,369 29,759 10, , , ,771 74,279 (40,352) 33,927 59, , , , ,849 (10,139) 410,710 54, , , , ,354 (71,754) 315, , ,476 - (45,492) (45,492) 66, ,672 1, ,825 1,396, ,742 (158,608) 314,134 10, , , ,096 73,303 (54,094) 19,209 47, , , ,405 52, ,969 2,558 32, ,513 18,228 2,093 20,321 1,688 21, , ,419 12,025 (33,997) (21,972) 127 1, ,275 56, (18,092) (17,185) 47, , , ,410 43, ,025 2,519 32, ,971 17,950 1,963 19,913 4,174 53, ,941 29,740 3,409 33,149 11, , , ,049 79,139 (11,288) 67,851 35, , , , ,862 (24,131) 227,731 1,390 17, ,292 9, ,387 1,177 15, ,345 8,390 21,369 29,759 2,621 33, , ,842 18,676 (52,153) (33,477) 106,097 1,365,126 1, ,415 1,628, ,973 (51,805) 704,168 6,655 85, ,384 47,418 20,892 68,310 14, , , ,985 43, , ,255 2,589,507 3,097-2,793,859 1,434, ,603 1,771, , ,730 6, ,856 1,631 20, ,640 11,620 29,601 41,221

13 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF PENSION AMOUNTS BY EMPLOYER AS OF AND FOR THE YEAR ENDED JUNE 30, 2014 Deferred Outflows of Resources Net Pension Liability Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Outflows of Resources Hammond $ 10,211,371 $ - $ - $ - $ 901,245 $ 901,245 Harahan 1,284, Haughton 997, , ,066 Haynesville 343, Henderson 75, ,390 1,390 Hodge 66, ,107 64,107 Homer 360, Houma 9,223, Independence 106, Iowa 209, ,145 12,145 Jackson 254, ,036 11,036 Jean Lafitte 80, Jeanerette 794, , ,611 Jena 237, ,118 18,118 Jennings 2,656, Jonesboro 180, ,302 37,302 Kaplan Kenner 18,977, Kentwood 225, , ,478 Kinder 629, ,476 38,476 Lafayette 32,628, ,393,281 2,393,281 Lake Charles 18,712, , ,702 Lecompte Leesville 1,535, Leonville 238, Livingston 309, ,629 23,629 Livonia 597, Lockport 484, Mamou 75, ,972 3,972 Mandeville 4,934, Mangham Mansfield 1,475, ,285 93,285 Many 564, Marksville 202, Maurice 359, ,476 80,476 Mer Rouge 116, ,273 7,273 Minden 2,787, Monroe 19,641, Morgan City 3,922, , ,922 Natchitoches 5,165, New Llano 242, ,510 88,510 New Orleans 137,466, New Roads 1,356, Newellton Oak Grove 345, Oakdale 854, Oberlin 188, ,087 17,087 Olla 93, Opelousas 6,370, (Continued)

14 PAGE 10 Deferred Inflows of Resources Pension Expense (Benefit) Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Inflows of Resources Proportionate Share of Plan Pension Expense Net Amortization of Deferred Amounts from Changes in Proportion Total Pension Expense (Benefit) $ 179,595 $ 2,310,817 $ 2,763 $ - $ 2,493,175 $ 1,279,673 $ 300,415 $ 1,580,088 22, , , , ,920 (124,440) 36,480 17, , , ,052 47, ,074 6,047 77, , ,661 43,088 (14,905) 28,183 1,324 17, ,385 9, ,900 1,177 15, ,345 8,390 21,369 29,759 6,335 81, , ,028 45,139 (66,028) (20,889) 162,223 2,087,299 2, ,199 2,375,217 1,155,895 (41,067) 1,114,828 1,871 24, ,556 78,528 13,330 (17,519) (4,189) 3,690 47, ,225 26,292 4,048 30,340 4,472 57, ,082 31,865 3,679 35,544 1,422 18, ,748 83,490 10,133 (21,249) (11,116) 13, , ,956 99, , ,089 4,185 53, ,101 29,822 6,039 35,861 46, , , , ,928 (9,091) 323,837 3,183 40, ,188 22,680 12,434 35, ,037 79,037 - (26,346) (26,346) 333,763 4,294,471 5, ,096 4,894,465 2,378,171 (87,032) 2,291,139 3,971 51, ,122 28,292 53,826 82,118 11, , ,778 78,930 12,826 91, ,861 7,383,763 8,829-7,966,453 4,088, ,761 4,886, ,112 4,234,619 5,064-4,568,795 2,345, ,567 2,606, ,351 83,351 - (27,784) (27,784) 27, , , , ,422 (22,122) 170,300 4,188 53, ,959 71,103 29,844 (4,320) 25,524 5,445 70, ,590 38,798 7,877 46,675 10, , , ,450 74,857 (26,202) 48,655 8, , , ,764 60,737 (25,144) 35,593 1,319 16, ,317 9,402 1,324 10,726 86,782 1,116,608 1,335 45,642 1,250, ,350 (15,214) 603, ,490 85,490 - (28,497) (28,497) 25, , , ,905 31, ,000 9, , , ,426 70,715 (136,884) (66,169) 3,554 45, , ,197 25,321 (37,288) (11,967) 6,318 81, ,710 45,019 26,825 71,844 2,052 26, ,490 14,623 2,425 17,048 49, , ,985 1,045, ,280 (121,662) 227, ,449 4,444,833 5, ,214 5,107,811 2,461,438 (104,071) 2,357,367 68, ,545 1, , , , ,807 90,845 1,168,891 1, ,042 1,652, ,303 (130,347) 516,956 4,256 54, ,086 30,328 29,503 59,831 2,417,733 31,108,543 37,199 7,938,520 41,501,995 17,227,139 (2,646,174) 14,580,965 23, , , , ,026 (71,850) 98, ,399 49,399 - (16,466) (16,466) 6,073 78, , ,895 43,272 (19,196) 24,076 15, , , , ,114 (16,474) 90,640 3,312 42, ,984 23,602 5,696 29,298 1,651 21, ,235 59,154 11,764 (12,079) (315) 112,045 1,441,662 1, ,392 2,103, ,357 (182,797) 615,560

15 MUNICIPAL POLICE EMPLOYEES' RETIREMENT SYSTEM SCHEDULE OF PENSION AMOUNTS BY EMPLOYER AS OF AND FOR THE YEAR ENDED JUNE 30, 2014 Deferred Outflows of Resources Net Pension Liability Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Outflows of Resources Parks $ 102,149 $ - $ - $ - $ 3,823 $ 3,823 Patterson 662, Pearl River 130, ,402 2,402 Pine Prairie 123, ,085 57,085 Pineville 6,192, Plain Dealing 105, , ,786 Plaquemine 2,029, Pollock 195, ,262 85,262 Ponchatoula 2,110, , ,808 Port Allen 1,953, , ,795 Port Vincent 71, ,217 68,217 Rayne 1,670, , ,316 Rayville 747, Ringgold 384, ,986 29,986 Rosepine 168, ,341 21,341 Ruston 4,617, Sarepta 135, Scott 1,956, , ,574 Shreveport 67,957, ,320,571 1,320,571 Slaughter 319, , ,481 Slidell 9,502, , ,164 Sorrento Springhill 1,230, , ,796 St. Francisville 208, ,807 19,807 St. Gabriel 1,732, , ,991 St. Martinville 394, Sulphur 5,821, ,105 93,105 Sunset 118, ,495 7,495 Tallulah 719, , ,904 Thibodaux 6,974, Tickfaw 181, ,866 71,866 Vidalia 1,717, , ,931 Ville Platte 1,675, Vinton 796, ,351 72,351 Walker 1,485, Washington 201, , ,831 Welsh 467, , ,999 West Monroe 7,315, , ,962 Westlake 1,777, ,480 89,480 Westwego 4,438, , ,054 Winnfield 935, ,628 96,628 Winnsboro 945, , ,464 Woodworth 580, , ,341 Youngsville 277, ,191 11,191 Zachary 5,109, , ,506 Zwolle 100, ,061 4,061 Total $ 625,608,202 $ - $ - $ - $ 17,200,220 $ 17,200,220 See accompanying notes.

16 PAGE 11 Deferred Inflows of Resources Pension Expense (Benefit) Differences Between Expected and Actual Experience Net Difference Between Projected and Actual Investment Earnings on Pension Plan Investments Changes of Assumptions Changes in Proportion Total Deferred Inflows of Resources Proportionate Share of Plan Pension Expense Net Amortization of Deferred Amounts from Changes in Proportion Total Pension Expense (Benefit) $ 1,797 $ 23,116 $ 28 $ - $ 24,941 $ 12,801 $ 1,274 $ 14,075 11, , , ,100 83,027 (144,780) (61,753) 2,292 29, ,824 16, ,136 2,180 28, ,258 15,530 19,029 34, ,911 1,401,335 1, ,475 1,710, ,024 (66,158) 709,866 1,851 23, ,696 13,189 33,595 46,784 35, , , , ,303 (36,439) 217,864 3,442 44, ,777 24,522 28,421 52,943 37, , , ,488 47, ,758 34, , , , , ,718 1,253 16, ,392 8,927 22,739 31,666 29, , , ,360 57, ,799 13, , , ,924 93,618 (66,510) 27,108 6,758 86, ,821 48,156 9,996 58,152 2,966 38, ,173 21,133 7,114 28,247 81,205 1,044,855 1, ,760 1,365, ,615 (79,253) 499,362 2,389 30, ,296 71,466 17,025 (12,766) 4,259 34, , , ,146 71, ,004 1,195,223 15,378,718 18,390-16,592,331 8,516, ,191 8,956,543 5,615 72, ,948 40,008 44,827 84, ,127 2,150,391 2,571-2,320,089 1,190, ,055 1,311, ,318 76,318 - (25,439) (25,439) 21, , , , , ,489 3,674 47, ,003 26,178 6,603 32,781 30, , , , , ,483 6,946 89, , ,315 49,491 (18,298) 31, ,378 1,317,285 1,575-1,421, ,480 31, ,515 2,084 26, ,934 14,851 2,499 17,350 12, , ,712 90,188 43, , ,670 1,578,377 1, ,132 1,944, ,066 (80,378) 793,688 3,200 41, ,420 22,800 23,955 46,755 30, , , , , ,533 29, , , , ,913 (128,877) 81,036 14, , ,405 99,782 24, ,899 26, , , , ,190 (13,828) 172,362 3,541 45, ,161 25,233 64,277 89,510 8, , ,058 58,543 50, , ,671 1,655,588 1,980-1,786, , ,654 1,078,477 31, , , ,707 29, ,534 78,069 1,004,494 1,201-1,083, ,264 98, ,616 16, , , ,242 32, ,451 16, , , ,449 70, ,937 10, , ,679 72,719 43, ,500 4,881 62, ,758 34,778 3,731 38,509 89,867 1,156,298 1,383-1,247, , , ,831 1,771 22, ,557 12,596 1,349 13,945 $ 11,003,038 $ 141,574,121 $ 169,293 $ 17,200,220 $ 169,946,672 $ 78,400,233 $ - $ 78,400,233

17 PAGE 12 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, 2014 The Municipal Police Employees Retirement System (System) is a cost-sharing multipleemployer defined benefit pension plan established by Act 189 of 1973 to provide retirement, disability and survivor benefits to municipal police officers in Louisiana. 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: The Municipal Police Employees Retirement System prepares its employer schedules in accordance with Governmental Accounting Statement No. 68 Accounting and Financial Reporting for Pensions an amendment of GASB Statement No. 27. GASB Statement No. 68 established standards for measuring and recognizing liabilities, deferred outflows of resources, deferred inflows of resources and expenses/expenditures. It provides methods and assumptions that should be used to project benefit payments, discount projected benefit payments to their actuarial present value and attribute that present value to periods of employee service. It also provides methods to calculate participating employer s proportionate share of net pension liability, deferred inflows, deferred outflows, pension expense and amortization periods for deferred inflows and deferred outflows. Basis of Accounting: The System s employer schedules were prepared using the accrual basis of accounting. Members earnable compensation, for which the employer allocations are based, is recognized in the period in which the employee is compensated for services performed. The member s earnable compensation is attributed to the employer for which the member is employed as of June 30, During the year ended June 30, 2014, the System adopted the provisions of GASB Statement No. 67, Financial Reporting for Pension Plans. GASB Statement No. 67 established new standards of financial reporting for defined benefit pension plans. Significant changes included specifying the approach of contributing entities to measure pension liabilities for benefits provided through the pension plan. The provisions of this statement were retroactively applied to the fiscal year ended June 30, System Employees: The System is not allocated a proportionate share of the net pension liability related to its employees. The net pension liability attributed to the System s employees is allocated to the remaining employers based on their respective employer allocation percentage. Plan Fiduciary Net Position: Plan fiduciary net position is a significant component of the System s collective net pension liability. The System s plan fiduciary net position was determined using the accrual basis of accounting. The System s assets, liabilities, revenues and expenses were recorded with the use

18 PAGE 13 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued) Plan Fiduciary Net Position: (Continued) of estimates and assumptions in conformity with accounting principles generally accepted in the United States of America. Such estimates primarily related to unsettled transactions and events as of the date of the financial statements and estimates over the determination of the fair market value of the System s investments. Accordingly, actual results may differ from estimated amounts. 2. PLAN DESCRIPTION: The Municipal Police Employees' Retirement System is the administrator of a cost-sharing multiple-employer plan. Membership in the System is mandatory for any full-time police officer employed by a municipality of the State of Louisiana and engaged in law enforcement, empowered to make arrests, providing he or she does not have to pay social security and providing he or she meets the statutory criteria. The System provides retirement benefits for municipal police officers. The projections of benefit payments in the calculation of the total pension liability includes all benefits to be provided to current active and inactive employees through the System in accordance with benefit terms and any additional legal agreements to provide benefits that are in force at the measurement date. Benefit provisions are authorized within Act 189 of 1973 and amended by LRS 11: :2233. The following is a brief description of the plan and its benefits and is provided for general information purposes only. Participants should refer to the appropriate statutes for more complete information. Membership Prior to January 1, 2013 A member is eligible for regular retirement after he has been a member of the System and has 25 years of creditable service at any age or has 20 years of creditable service and is age 50 or has 12 years creditable service and is age 55. A member is eligible for early retirement after he has been a member of the System for 20 years of creditable service at any age with an actuarially reduced benefit. Benefit rates are three and one-third percent of average final compensation (average monthly earnings during the highest 36 consecutive months or joined months if service was interrupted) per number of years of creditable service not to exceed 100% of final salary. Upon the death of an active contributing member, or disability retiree, the plan provides for surviving spouses and minor children. Under certain conditions outlined in the statutes, the benefits range from forty to sixty percent of the member's average final compensation for the surviving spouse. In addition, each child under age eighteen receives benefits equal to ten percent of the member s average final compensation or $ per month, whichever is greater.

19 PAGE 14 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, PLAN DESCRIPTION: (Continued) Membership Commencing January 1, 2013 Member eligibility for regular retirement, early retirement, disability and survivor benefits are based on Hazardous Duty and Non Hazardous Duty sub plans. Under the Hazardous Duty sub plan, a member is eligible for regular retirement after he has been a member of the System and has 25 years of creditable service at any age or has 12 years of creditable service at age 55. Under the Non Hazardous Duty sub plan, a member is eligible for regular retirement after he has been a member of the System and has 30 years of creditable service at any age, 25 years of creditable service at age 55, or 10 years of creditable service at age 60. Under both sub plans, a member is eligible for early retirement after he has been a member of the System for 20 years of creditable service at any age, with an actuarially reduced benefit from age 55. Under the Hazardous and Non Hazardous Duty sub plans, the benefit rates are three percent and two and a half percent, respectively, of average final compensation (average monthly earnings during the highest 60 consecutive months or joined months if service was interrupted) per number of years of creditable service not to exceed 100% of final salary. Upon death of an active contributing member, or disability retiree, the plan provides for surviving spouses and minor children. Under certain conditions outlined in the statues, the benefits range from twenty-five to fifty-five percent of the member s average final compensation for the surviving spouse. In addition, each child under age eighteen receives ten percent of average final compensation or $200 per month whichever is greater. If deceased member had less than ten years of service, beneficiary will receive a refund of employee contributions only. Cost of Living Adjustments The Board of Trustees is authorized to provide annual cost-of-living adjustments computed on the amount of the current regular retirement, disability, beneficiary or survivor s benefit, not to exceed 3% in any given year. The Board is authorized to provide an additional 2% COLA, computed on the member s original benefit, to all regular retirees, disability, survivors and beneficiaries who are 65 years of age or older on the cut-off date which determines eligibility. No regular retiree, survivor or beneficiary shall be eligible to receive a cost-of-living adjustment until benefits have been received at least one full fiscal year and the payment of such COLA, when authorized, shall not be effective until the lapse of at least one-half of the fiscal year. Members who elect early retirement are not eligible for a cost of living adjustment until they reach regular retirement age.

20 PAGE 15 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, PLAN DESCRIPTION: (Continued) Deferred Retirement Option Plan A member is eligible to elect to enter the deferred retirement option plan (DROP) when he is eligible for regular retirement based on the members sub plan participation. Upon filing the application for the program, the employee's active membership in the System is terminated. At the entry date into the DROP, the employee and employer contributions cease. The amount to be deposited into the DROP account is equal to the benefit computed under the retirement plan elected by the participant at date of application. The duration of participation in the DROP is thirty six months or less. If employment is terminated after the three-year period the participant may receive his benefits by lump sum payment or a true annuity. If employment is not terminated, active contributing membership into the System shall resume and upon later termination, he shall receive additional retirement benefit based on the additional service. For those eligible to enter DROP prior to January 1, 2004, DROP accounts shall earn interest subsequent to the termination of DROP participation at a rate of half of one percentage point below the percentage rate of return of the System's investment portfolio as certified by the actuary on an annual basis but will never lose money. For those eligible to enter DROP subsequent to January 1, 2004, an irrevocable election is made to earn interest based on the System s investment portfolio return or a money market investment return. This could result in a negative earnings rate being applied to the account. If the member elects a money market investment return, the funds are transferred to a government money market account. Initial Benefit Option Plan In 1999, the State Legislature authorized the System to establish an Initial Benefit Option program. Initial Benefit Option is available to members who are eligible for regular retirement and have not participated in DROP. The Initial Benefit Option program provides both a one-time single sum payment of up to 36 months of regular monthly retirement benefit, plus a reduced monthly retirement benefit for life. Interest is computed on the balance based on same criteria as DROP. 3. EMPLOYER CONTRIBUTIONS: Contributions for all members are actuarially determined as required by state law but cannot be less than 9% of the employees earnable compensation excluding overtime but including state supplemental pay.

21 PAGE 16 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, EMPLOYER CONTRIBUTIONS: (Continued) For the year ended June 30, 2014, total contributions due for employers and employees were 41%. The employer and employee contribution rates for all members hired prior to January 1, 2013 and Hazardous Duty members hired after January 1, 2013 were 31% and 10%, respectively. The employer and employee contribution rates for all Non-Hazardous Duty members hired after January 1, 2013 were 33% and 8%, respectively. The employer and employee contribution rates for all members whose earnable compensation is less than or equal to the poverty guidelines issued by the United States Department of Health and Human Services were 33.5% and 7.5%, respectively. The actuarial required employer and employee combined contribution for June 30, 2014 was 41.53%. Non-employer contributions: The System also receives insurance premium tax monies as additional employer contributions. The tax is considered support from a non-contributing entity and appropriated by the legislature each year based on an actuarial study. Non-employer contributions are recognized as revenue during the year ended June 30, 2014 and excluded from pension expense. 4. SCHEDULE OF EMPLOYER ALLOCATIONS: The schedule of employer allocations reports the required projected combined (employer and employee) contributions in addition to the employer allocation percentage. The required combined contributions are used to determine the proportionate relationship of each employer to all employers of Municipal Police Employees Retirement System. The employer s proportion was determined on a basis that is consistent with the manner in which contributions to the pension plan are determined. The allocation percentages were used in calculating each employer s proportionate share of pension amounts. The allocation method used in determining each employer s proportion was based on the combined (employer and employee) projected contribution effort to the plan for the next fiscal year as compared to the total of all employers projected combined contribution effort to the plan for the next fiscal year. The combined projected contribution effort was actuarially determined by the System s actuary. The combined projected contribution effort was calculated by multiplying the projected future compensation of active members in the System on June 30, 2014 by the next fiscal year s combined actuarially required contribution rate. Projected future compensation was calculated by multiplying compensation by a payroll factor of Compensation was determined as follows: 1. Actual earned compensation for active members enrolled in the System the entire fiscal year, plus;

22 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, 2014 PAGE SCHEDULE OF EMPLOYER ALLOCATIONS: (Continued) 2. Annualized compensation for active members on June 30, 2014 enrolled in the System for a portion of the fiscal year. Annualized compensation was calculated using actual compensation and the employee s date of hire. The payroll factor was actuarially determined using salary assumptions for expected net changes in active members plus expected new hires and their payroll over the next fiscal year. The next fiscal year s net combined employer and employees actuarially required contribution rate is 39.80%. 5. SCHEDULE OF PENSION AMOUNTS BY EMPLOYER: The schedule of pension amounts by employer displays each employer s allocation of the net pension liability. The schedule of pension amounts by employer was prepared using the allocations included in the schedule of employer allocation. 6. ACTUARIAL METHODS AND ASSUMPTIONS: The net pension liability was measured as the portion of the present value of projected benefit payments to be provided through the pension plan to current active and inactive employees that is attributed to those employees past periods of service, less the amount of the pension plan s fiduciary net position. The components of the net pension liability of the System s employers as of June 30, 2014 are as follows: Total Pension Liability $ 2,512,627,665 Plan Fiduciary Net Position 1,887,019,463 Total Collective Net Pension Liability $ 625,608,202 The actuarial assumptions used in the June 30, 2014 valuation (excluding mortality) were based on the assumptions used in the June 30, 2014 actuarial funding valuation, and were initially designed to match, to the extent possible, those used by the prior actuary for the fiscal 2010 valuation. Adjustments to some non-mortality decrements were necessary due to differences in software design. A summary of the actuarial methods and assumptions used in determining the total pension liability as of June 30, 2014 are as follows:

23 PAGE 18 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, ACTUARIAL METHODS AND ASSUMPTIONS: (Continued) Valuation Date June 30, 2014 Actuarial Cost Method Investment Rate of Return Expected Remaining Service lives Inflation Rate 3% Entry Age Normal Cost 7.5%, net of investment expense 4 years Salary increases, Years of Service Salary Growth Rate including inflation % and merit % % % 30 & Over 4.00% The discount rate used to measure the total pension liability was 7.5%. The projection of cash flows used to determine the discount rate assumed that contributions from plan members will be made at the current contribution rates and that contributions from participating employers will be made at the actuarially determined rates approved by PRSAC taking into consideration the recommendation of the System s actuary. Based on those assumptions, the System s fiduciary net position was projected to be available to make all projected future benefit payments of current plan members. Therefore, the long-term expected rate of return on pension plan investments was applied to all periods of projected benefit payments to determine the total pension liability. The mortality rate assumption used was set based upon an experience study performed by the prior actuary on plan data for the period July 1, 2003 through June 30, 2008 and review of similar law enforcement mortality. The data was then assigned credibility weighting and combined with a standard table to produce current levels of mortality. This mortality was then projected forward to a period equivalent to the estimated duration of the System s liabilities. Annuity values calculated based on this mortality were compared to those produced by using a set back of standard tables. The result of the procedure indicated that the tables used would produce liability values approximating the appropriate generational mortality tables. 7. SENSITIVITY TO CHANGES IN DISCOUNT RATE: The following presents the net pension liability of the participating employers calculated using the discount rate of 7.5%, as well as what the employers net pension liability would be if it were calculated using a discount rate that is one percentage point lower 6.5% or one percentage point higher 8.5% than the current rate.

24 PAGE 19 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, SENSITIVITY TO CHANGES IN DISCOUNT RATE: (Continued) Changes in Discount Rate 1% Current 1% Decrease Discount Rate Increase 6.5% 7.5% 8.5% Net Pension Liability $903,271,048 $625,608,202 $392,396, CHANGE IN NET PENSION LIABILITY: The changes in the net pension liability for the year ended June 30, 2014 were recognized in the current reporting period as pension expense except as follows: Differences between Expected and Actual Experience: Differences between expected and actual experience with regard to economic or demographic factors in the measurement of the total pension liability were recognized in pension expense using the straight-line amortization method over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the pension plan. The difference between expected and actual experience resulted in a deferred inflow of resources in the amount of $14,670,717 for the year ended June 30, Pension benefit and remaining deferred inflow for the year ended June 30, 2014 was $3,667,679 and $11,003,038, respectively. Differences between Projected and Actual Investment Earnings: Differences between projected and actual investment earnings on pension plan investments were recognized in pension expense using the straight-line amortization method over a closed five-year period. The difference between projected and actual investment earnings resulted in a deferred inflow of resources in the amount of $176,967,651 for the year ended June 30, Pension benefit and remaining deferred inflow for the year ended June 30, 2014 was $35,393,530 and $141,574,121, respectively.

25 MUNICIPAL POLICE EMPLOYEES RETIREMENT SYSTEM NOTES TO SCHEDULES JUNE 30, 2014 PAGE CHANGE IN NET PENSION LIABILITY: (Continued) Changes of Assumptions or Other Inputs: Changes of assumptions about future economic or demographic factors or of other inputs were recognized in pension expense using the straight-line amortization method over a closed period equal to the average of the expected remaining service lives of all employees that are provided with pensions through the pension plan. Changes of assumptions or other inputs resulted in a deferred inflow of resources in the amount of $225,724 for the year ended June 30, Pension expense and remaining deferred inflow of resources for the year ended June 30, 2014 was $56,431 and $169,293, respectively. Change in Proportion: Changes in the employer s proportionate shares of the collective net pension liability and collective deferred outflows of resources and deferred inflows of resources since the prior measurement date were recognized in employer s pension expense (benefit) using a the straight-line amortization method over a closed period equal to the average of the expected remaining service lives of all employees that are provided pensions through the pension plan. 9. CONTRIBUTIONS PROPORTIONATE SHARE: Differences between contributions remitted to the System and the employer s proportionate share are recognized in pension expense (benefit) using the straight line amortization method over a closed period equal to the average of the expected remaining service lives of all employees that are provided with a pension through the pension plan. The resulting deferred inflow/outflow and amortization is not reflected in the schedule of employer amounts due to differences that could arise between contributions reported by the System and contributions reported by the participating employer. 10. RETIREMENT SYSTEM AUDIT REPORT: Municipal Police Employees Retirement System issued a stand-alone audit report on its financial statements for the year ended June 30, Access to the audit report can be found on the System s website: or on the Office of Louisiana Legislative Auditor s official website: