-e=mployees' Ret:i-rement Sys-tern of Geoi'gia State of Georgia ~mf1kr' ..@~EPydem Table of Contents BOARDS OF TRUSTEES ..... . LETTER OF TRANSMITTAL 2-3 LEGISLATION ................................................... 4 ACTUARIAL SUMMARY EMPLOYEES' RETIREMENT SYSTEM 5-7 PUBLIC SCHOOL EMPLOYEES RETIREMENT SYSTEM . . . . . . . . . . . . . . . . . . 8 - 10 LEGISLATIVE RETIREMENT SYSTEM ........................... , 11 - 13 TRIAL JUDGES AND SOLICITORS RETIREMENT FUND . . . . . . . . . . . . . . . . . 14 - 16 STATE EMPLOYEES ASSURANCE DEPARTMENT (GTLI) 17 - 19 INVESTMENT REPORT POOLED INVESTMENT FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 STRUCTURAL ANALYSIS OF INVESTMENTS/RATE OF RETURN . . . . . . . . . . . . . . . 21 TEMPORARY INVESTMENTS/BONDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 COMMON STOCK HOLDINGS ~-~ MORTGAGES, OTHER SECURED NOTES, REAL ESTATE ................ , . 26 AUDITED FINANCIAL STATEMENTS TABLE OF CONTENTS ......................................... 27 INDEPENDENT AUDITORS' REPORT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 BALANCE SHEETS, HISTORICAL TREND INFORMATION, SUPPLEMENTARY INFORMATION, AND ADDITIONAL INFORMATION . . . . 29 - 42 ,t..<.;EfVEL JAN O2 1996 OOCUMENfS ~A UBRARIE~ State of Georgia ~~ il6~E?~ Boards of Trustees Joe Edwards, Ph.D. Chairman Commissioner, Retired Department of Human Resources Claude L. Vickers, ex-officio State Auditor Department of Audits Steven N. McCoy, ex-officio Director Office of Treasury & Fiscal Services Bobbie Jean Bennett, ex-officio Commissioner State Merit System William E. Strick.land Vice Chairman Commissioner, Retired Georgia Revenue Department William E. Sumner Attorney at Law Atlanta, Georgia John W. McIntyre Chairman and CEO, Retired Citizens & Southern National Bank Jeanne Hill Director Georgia School Bus Drivers Association Members of ERS Board of Trustees Billy Shaw Abney Juvenile Court Judge Spencer Lawton, Jr. State Court Solicitor Members of ERS Board of Trustees S. Lark Ingram State Court Judge -2~.fl6~E?~ E?tate E?ocialE?~ i!YJ'lld cS3wnd ~~ fl>ejtni r:go,n1;r.,:ktwn ~kn Members of ERS Board of Trustees Joe Edwards, Ph.D., Chmn. Commissioner, Retired Department of Human Resources Steven N. McCoy, ex-officio Director Office of Treasury & Fiscal Services Claude Vickers State Auditor Department of Audits David Poythress, ex-officio Commissioner Department of Labor Bobbie Jean Bennett, ex-officio Commissioner State Merit System John W. McIntyre Chairman and CEO, Retired Citizens & Southern National Bank -1- State of Georgia ~~ i l 6 ~ ( ? ~ Letter of Transmittal DIRECTOR'S COMMENTS It is a pleasure to present the 1995 Annual Report on the systems and programs administered by the Employees' Retirement System (ERS). By statute, the staff of the Employees' Retirement System administers seven separate and distinct systems/programs: the Employees' Retirement System, the Public School Employees' Retirement System, the Trial Judges and Solicitors Retirement Fund, the Legislative Retirement System, the Georgia Defined Contribution Plan, the State Employees' Assurance Department, commonly known as the Group Term Life Insurance Program, and State Social Security contracts with political subdivisions. This report includes the following: letters from our actuary, Buck Consultants, Inc., on the funding of the retirement systems and the Group Term Life Insurance Program with highlights from the most recent valuation of each system, an investment report, including a listing of the Pooled Investment Fund Portfolio, the auditor's report from Deloitte & Touche, a synopsis of legislation affecting the retirement systems passed by the 1995 General Assembly. Educational Programs Since 1970, we have offered a PreRetirement Program in the Atlanta area for prospective retirees of ERS who are within five years of retirement eligibility. In recent years the program was expanded to include mid-career and younger employees. The programs are now called Series I, Series II, and Series III. With this expansion, ERS now offers educational planning for all members of the system. The seminars provide exploration and discussion of topics such as retirement, Social Security, Medicare, health insurance, estate planning, and wills. Classes are coordinated and conducted by our staff with outside resource people. Investments During Fiscal Year 1995, investments of the "Pooled Investment Fund" (including funds of Employees' Retirement System, the Public School Employees Retirement System, the Trial Judges and Solicitors Retirement Fund, the Legislative Retirement System, the District Attorneys Retirement Fund/System, the Superior Court Judges Retirement Fund/System, and the State Employees Assurance Department) continued to grow. Investment assets increased by 10.3% . The fiscal yearend book value of the fund was $6,126,702,000. -2 - State of Georgia -{3~' Y6eummentElydem Letter of Transmittal Investment income was $538,865,000 resulting in a return on the average investment for the period of 9.22%. The investment status of ERS is excellent. The very high quality of the fund's investments is in keeping with the continued policy of "Conservatism" and "Preservation of Capital." The return on investments is well in excess of actuarial requirements. We hope you find this report informative. It is intended as a basis for making management decisions and for determining responsible stewardship for the assets contributed by the retirement systems' members and their employees. It is distributed to all employers as our link between the retirement systems and our membership. We would like to express our gratitude to the Boards of Trustees for their leadership. We appreciate the support of Governor Miller, the Legislature, and departmental officials. With this continued interest and support, and the diligence of our staff, we can assure our members and retirees that we will continue to maintain a successful operation that provides protection and financial soundness to the retirement system. Rudolph Johnson Director -3 - State of Georgia ~+r' .!Z6~EY'ydem Legislation The following is a brief synopsis of legislation enacted during the 1995 session of the General Assembly having an effect on the systems administered by the Employees' Retirement System (ERS) and/or their members. The laws were effective July 1, 1995. Act 0259 (H.B. 136) - (All retirement systems) Requires the State Auditor to provide an actuarial investigation for a reduction in cost amendment to a retirement bill having a fiscal impact. Also provides that fiscal retirement bills amended so as to reduce the fiscal impact shall be funded at the reduced cost. Act 0378 (H.B. 137) - This bill provides that ERS shall administer the Superior Count Judges Retirement Fund, the Superior Court Judges Retirement System, the District Attorneys' Retirement Fund, and the District Attorneys' Retirement System. Act 0271 (H.B. 327) - (All retirement systems) The maximum compensation used in computing employee and employer contributions to, or benefits due from, any public retirement plan shall be the maximum compensation set forth in Section 401 (a)( 17) of the IRC as now or hereafter amended for new members of the system on and after January 1, 1996. [This law was enacted to comply with IRC regulations. The cap at that time will be $150,000 and will be indexed in future years.] Act 0337 - (H.B. 662) - Amends the section dealing with the ERS Board's authority to make investments to allow investments in other countries in a corporation that has a market capitalization equivalent to $100 million, provided the Board shall not invest more than 5% of its portfolio in foreign investments. Act 0261 (H.B. 139) - Provides that no evidence of a disability shall be considered by ERS's medical board unless it is submitted within 12 months of the date the member submits his/her firs_t application for a disability retirement. -4 - State of Georgia :?:,mfilor' Q g ~EfPr,tem Actuary's Certification Letter BUC' CONSULTANTS 200 Galleria Parkway, N.W. Suite 1200 Atlanta, Georgia 30339-5945 November 15, 1995 Board of Trustees Employees' Retirement System of Georgia Two Northside 75 Atlanta, Georgia 30318 Attention: Mr. Rudolph Johnson, Director Gentlemen: Section 47-2-26 of the Code of Georgia which governs the operation of the Employees' Retirement System of Georgia provides that the actuary shall make periodic valuations of the contingent assets and liabilities of the Retirement System on the basis of regular interest and the table last adopted by the Board of Trustees. We have submitted the report giving the results of the valuation of the System prepared as of June 30, 1994. The report indicates that annual employer contributions at the rate of 10.64% of compensation for Old Plan members and 15.64% for New Plan members are sufficient to support the basic benefits of the System as in effect in 1995. The System is funded on an actuarial reserve basis. The actuarial assumptions used are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The valuation method used in the most recent valuation is the entry age normal cost method. Gains and losses are reflected in-the unfunded accrued liability which is being amortized by regular contributions within a 20-year period. On the basis of the recommended contribution rate, the Retirement System is being funded in on conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law. In our opinion the System is operating an actuarially sound basis and the sufficiency of the retirement funds to provide the benefit called for by the System may be safely anticipated. Sin~~ Donald M. Overholser Consulting Actuary -5 - State of Georgia ~~' !l6~Ef'ydem Valuation Balance Sheet - as of June 30, 1994 - dollar amounts in thousands ACTUARIAL LIABILITIES (1) Present value of prospective benefits payable on account of present retired members, beneficiaries of deceased members, and members entitled to deferred vested benefits Service and disaiblity benefits $ Death and survivor benefits Deferred vested benefits Total (2) Present value of prospective benefits payable on account of present active members: Retirement and survivor allowances $ Refunds of member's contributions Total (3) TOTAL ACTUARIAL LIABILITIES 1,917,240 203,317 107 096 $ 5,388,434 65439 i 2,227,653 5 453 873 7 681 52!;i PRESENT AND PROSPECTIVE ASSETS (4) Present assets: Annuity Savings Fund $ Pension Accumulation Fund Total present assets (5) Present value of total future contributions= (3) - (4) $ (6) Present value of future member contributions and employer paid member contributions (7) Present value of future employer contributions = (5) - (6) $ (8) Employer normal contribution rate (9) Present value of future payroll (1 %) $ (10) Prospective normal contributions = (8) x (9) (11) Prospective unfunded acccrued liability contributions = (7) - (10) (12) TOTAL PRESENT AND PROSPECTIVE ASSETS 675,290 4 182 725 $ 2,823,511 1,734,416 4.44% 188,816 i 4,858,015 1,089,095 838,343 896 073 7 681 526 -6 - State of Georgia ~~ Q 3 ~ E ? ~ Summary of Principal Results - as of June 30, 1994 - dollar amounts in thousands Valuation Date Number of active members: Number Annual Compensation Retired members and beneficiaries: Number Annual allowances Valuation assets Unfunded actuarial accrued liability Recommended employer contribution rates: Old Plan and New Plan Normal Accrued Liability Total Old Plan Normal Accrued Liability Total New Plan Normal (includes 4.75% paid for member) Accrued liability Group Term Life Insurance Total June 30 1994 June 30 1993* 71,407 68,646 $ 1,759,224 $ 1,667,428 18,124 17,506 $ 240,908 $ 183,468 $ 4,858,015 $ 4,366,979 $ 896,073 $ 748,343 4.44% 6.20% 10.64% 9.19% 6.20 0.25 15.64% 4.51% 4.81% 8.69% * 1993 figures do not reflect cost-of-living and supplemental adjustments granted after December 31, 1983, employer payment of New Plan member contributions and employer GTLI contribution. -7 - State of Georgia Actuary's Certification Letter BUC' CONSULTANTS 200 Galleria Parkway, NW. Suite 1200 Atlanta, Georgia 30339-5945 November 15, 1995 Board of Trustees Employees' Retirement System of Georgia Two Northside 75 Atlanta, Georgia 30318 Attention: Mr. Rudolph Johnson, Director Gentlemen: Section 47-4-60 of the law governing the operation of the Georgia Public School Employees' Retirement System provides that the employer contributions toward the cost of the System shall be actuarially determined and approved by the Board. We have submitted the report giving the results of the valuation of the System prepared as of June 30, 1994. The report indicates that an annual employer contribution at the rate of $448.42 per active member is sufficient to support the benefits of the System as in effect in 1995. The System is funded on an actuarial reserve basis. The actuarial assumptions used are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The valuation method used in the most recent valuation is the entry age normal cost method. Gains and losses are reflected in the unfunded accrued liability which is being amortized by regular contributions within a 20-year period. On the basis of the recommended contribution rate, the Retirement System is being funded in conformity with the minimum funding standards set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law. In our opinion, the System is operating on an actuarially sound basis and the sufficiency of the retirement funds to provide the benefits called for by the System may be safely anticipated. Sincerely, Donald M. Overholser Consulting Actuary -8 - State of Georgia ~dk, EfPclwol-6~ .[,~[JP~ Valuation Balance Sheet - as of June 30, 1994 - ACTUARIAL LIABILITIES (1) Present value of prospective benefits payable on account of present retired members, beneficiaries of deceased members, and members entitled to deferred benefits (2) Present value of prospective benefits payable on account of present active members: Service retirement allowances Disability retirement allowances Refunds of members' contributions Total (3) TOTAL ACTUARIAL LIABILITIES 200,551,878 204,001,029 19,546,612 2 708 392 226 256 033 426 807 911 PRESENT AND PROSPECTIVE ASSETS (4) Present assets: Members' Contributions Fund $ Pension Accumulation Fund Total present assets (5) Present value of total future contributions= (3) - (4) $ (6) Present value of future member contributions to the Members' Contributions Funds (7) Present value of future employer contributions to the Pension Accumulation Fund = (5) - (6) $ (8) Employer normal contribution rate $ (9) Present value of future membership seiv ice (10) Prospective normal contributions= (8) x (9) (11) Prospective unfunded acccrued liability contributions = (7) - (10) (12) TOTAL PRESENT AND PROSPECTIVE ASSETS 13,636,000 296 262 000 $ 116,909,911 109,651,411 256.65 201,625 ~ 309,898,000 7,258,500 51,747,056 57 904 355 426 807 911 -9 - State of Georgia cs@,dk E?ckd~~ Jl6~EfPydem Summary of Principal Results - as of June 30, 1994 - Valuation Date Active members: Number Retired members and beneficiaries: Number Annual allowances Valuation assets Unfunded accrued actuarial liability Normal contribution rate per active member Recommended annual employer contributions: Normal Accrued Liability Total June 30 1994 June 30 1993 29,693 28,892 9,688 9,457 $ 17,502,787 $ 16,703,557 $ 309,898,000 $ 287,808,000 $ 57,904,355 $ 28,479,725 $ 256.65 $ 223.63 $ 7,620,708 $ 5 694 292 $ 13,315,000 $ 6,461,118 2 688 882 9,150,000 The valuation takes into account the effect of amendments to the System enacted through the 1995 session of the General Assembly. The valuation reflects the increase in the accrual rate since the previous valuation from $8.00 to $9.00 per month effective July 1, 1995. -10- State of Georgia .E~.!26~E?~ Actuary's Certification Letter BUC' CONSULTANTS 200 Galleria Parkway, N.W. Suite 1200 Atlanta, Georgia 30339-5945 November 15, 1995 Board of Trustees Employees' Retirement System of Georgia Two Northside 75 Atlanta, Georgia 30318 Attention: Mr. Rudolph Johnson, Director Gentlemen: Section 47-6-22 of the Code of Georgia which governs the operation of the Georgia Legislative Retirement System provides that the actuary shall make periodic valuations of the contingent assets and liabilities of the Retirement System on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the valuation of the System prepared as of June 30, 1993. The report indicates that annual employer contributions at the rate of $822.82 per active member are sufficient to support the benefits of the System as in effect in 1995. The System is funded on an actuarial reserve basis. The actuarial assumptions used are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The valuation method used in the most recent valuation is the unit credit actuarial cost method. Gains and losses are reflected in the unfunded accrued liability which is being amortized by regular contributions within a 20-year period. On the basis of the recommended contribution rate, the Retirement System is being funded in conformity with the minimum funding standards set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law. In our opinion the System is operating on an actuarially sound basis and the sufficiency of the retirement funds to provide the benefits called for by the System may be safely anticipated. Si~~ Donald M. Overholser Consulting Actuary -11 - State of Georgia . E ~.!l6ewrommuffP~ Valuation Balance Sheet - as of June 30, 1993 - This report is prepared biennially. ACTUARIAL LIABILITIES Present value of prospective benefits payable on account of: (1) Present retired members and beneficiaries of deceased members and members entitled to deferred vested benefits (2) Present active members: Service retirement allowances $ Disability retirement allowances Survivor allowances Refunds of members' contributions Total (3) TOTAL ACTUARIAL LIABILITIES $ 8,842,399 4,777,648 325,488 265,407 255 252 $ $ 5 623 795 14 466194 PRESENT AND PROSPECTIVE ASSETS (4) Present assets: Members' Account $ Accumulation Account Total present assets (5) Present value of total future contributions ; (3) - (4) $ (6) Present value of future member contributions (7) Present value of future employer contributions ; (5) - (6) $ (8) Prospective normal contributions (9) Prospective unfunded accrued liability contributions ; (7) - (8) (10) TOTAL PRESENT AND PROSPECTIVE ASSETS 1,967,000 9173 000 $ 3,326,194 2,291,921 $ 11,140,000 1,034,273 1,043,299 1248622 14 466194 -12 - State of Georgia E~ il6~EfP~ Summary of Principal Results - as of June 30, 1993 - This report is prepared biennially. Valuation Date Number of active members Retired members and beneficiaries: Number Annual allowances Valuation assets Unfunded actuarial accrued liability Employer normal contribution rate per active member Recommended annual employer contributions: Normal Accrued Liability Total June 30 1993 197 June 30 1991 214 151 $ 781,371 $ $ 11,140,000 $ $ 1,248,622 $ $ 341.08 $ 123 524,674 9,767,000 592,199 372.09 $ 67,193 $ 94903 $ 162,096 $ 79,627 50 729 130,356 The valuation takes into account the effect of amendments to the System enacted through the 1994 session of the General Assembly. - 13 - cff+ &Tnal State of Georgia and[JP~ fl6~c.Sliand Actuary's Certification Letter BUC' CONSULTANTS 200 Galleria Parkway, N.W. Suite 1200 Atlanta, Georgia 30339-5945 November 15, 1995 Board of Trustees Georgia Trial Judges and Solicitors Retirement Fund Two Northside 75 Atlanta, Georgia 30318 Attention: Mr. Rudolph Johnson, Director Gentlemen: Section 47-10-22 of the Code of Georgia which governs the operation of the Georgia Trial Judges and Solicitors Retirement Fund provides that the actuary shall make periodic valuations of the contingent assets and liabilities of the Retirement Fund on the basis of regular interest and the. tables last adopted by the Board of Trustees. We have submitted the report giving the results of the valuation of the Fund prepared as of June 30, 1993. The report indicates that employer contributions at the rate of 11.58 % of compensation are sufficient to support the benefits of the Fund as in effect in 1995. The Fund is funded on an actuarial reserve basis. The actuarial assumptions used are in the aggregate reasonably related to the experience under the Fund and to reasonable expectations of anticipated experience under the Fund. The valuation method used in the most recent valuation is the entry age normal cost method. There is no unfunded accrued liability as of June 30, 1993. On the basis of the recommended contribution rate, the Retirement Fund is being funded in conformity with the minimum funding standards set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law. In our opinion the Fund is operating on an actuarially sound basis and the sufficiency of the retirement funds to provide the benefits called for by the Fund may be safely anticipated. Si~~ Donald M. Overholser Consulting Actuary - 14 - State of Georgia Jl'+ &nd rum/ E ? ~ .[13~ ,53~ Valuation Balance Sheet - as of June 30, 1993 - This report is prepared biennially. ACTUARIAL LIABILITIES Present value of prospective benefits payable on account of: (1) Present retired members and beneficiaries of deceased members and members entitled to deferred vested benefits (2) Present active members (3) TOTAL ACTUARIAL LIABILITIES $ 6,507,216 24.629 670 $ 31136886 PRESENT AND PROSPECTIVE ASSETS (4) Present assets: Members' Account $ Accumulation Account $ Total present assets (5) Present value of total future contributions= (3) - (4) $ (6) Present value of future member contributions (7) Present value of future employer contributions = (5) - (6) $ (8) Employer normal contribution rate (9) Present value of future payroll (1%) $ (10) Prospective normal contributions = (8) x (9) (11) Prospective (surplus) accrued liability contributions = (7) - (10) (12) TOTAL PRESENT AND PROSPECTIVE ASSETS 3,538,000 16 525 000 $ 11,073,886 $ 6,370,127 17.04% 534,546 $ 20,063,000 4,703,759 9,108,664 (2 738 537) 311~6886 - 15 - State of Georgia J1+ t7nat &idE?~ f26~r.S3and Summary of Principal Results - as of June 30, 1993 - This report is prepared biennially. Valuation Date Active members: Number Annual compensation Retired members and beneficiaries: Number Annual allowances Valuation assets Unfunded actuarial accrued liability (surplus) Recommended employer contribution rates: Normal Accrued liability Total June 30 1993 June 30 1991 146 141 $ 5,043,286 $ 4,709,354 34 25 $ 449,956 $ 225,548 $ 20,063,000 $ 15,915,000 $ (2,738,537) $ (2,277,259) 17.04% (5.46} 11.58% 16.23% /4.74} 11.58% The valuation takes into account the effect of amendments to the System enacted through the 1994 session of the General Assembly. -16- State of Georgia &niujt iTe?'m 2~ c J ~ ~Ian Actuary's Certification Letter BUC' CONSULTANTS 200 Galleria Parkway, N.W. Suite 1200 Atlanta, Georgia 30339-5945 November 15, 1995 Board of Trustees Employees' Retirement System of Georgia Two Northside 75 Atlanta, Georgia 30318 Attention: Mr. Rudolph Johnson, Director Gentlemen: Chapters 47-2 and 47-19 of the Code of Georgia which govern the operation of the Georgia Employees' Group Term Life Insurance Plan provide that the actuary shall make periodic valuations of the contingent assets and liabilities of the Insurance Plan on the basis of regular interest and the tables last adopted by the Board of Trustees. We have submitted the report giving the results of the valuation of the Plan prepared as of June 30, 1993. The report indicates that the Plan is in close actuarial balance. Combined employer and employee contributions at the rate of 0.50% of salary are sufficient to support the benefits of the Plan. The Plan is funded on an actuarial reserve basis. The actuarial assumptions used are in the aggregate reasonably related to the experience under the Plan and to reasonable expectations of anticipated experience under the Plan. In our opinion the Plan is operating on an actuarially sound basis and the sufficiency of the funds to provide the benefits called for by the Plan may be safely anticipated. Sincerely yours, ~~ Donald M. Overholser Consulting Actuary - 17 - State of Georgia 0~ i7m9n 2~ G J ~ t.&Okn Valuation Balance Sheet - as of June 30, 1993 - This report is prepared biennially. ACTUARIAL LIABILITIES (1) Present value of prospective benefits payable on account of present retired members $ 95,956,275 (2) Present value of prospective benefits payable on account of present active members $ 288 231 768 (3) TOTAL ACTUARIAL LIABILITIES $ 384188 043 PRESENT AND PROSPECTIVE ASSETS (4) Present assets $ 282,431,000 (5) Present value of future member premiums 58,265,018 (6) Present value of future employer contributions 47 985 325 (7) Total present assets and present value of future employee premiums and employer contributions $ 388,681,343 (8) Actuarial (Surplus) Deficit (4 493 300) (9) TOTAL PRESENT AND PROSPECTIVE ASSETS $ 384188 043 - 18 - State of Georgia &~ iTw,m 2~ GJ~ cs@kn Summary of Principal Results - as of June 30, 1993 - This report is prepared biennially Valuation Date Active members: Number Annual compensation Retired members: Number Insurance amount Valuation assets Actuarial (surplus) deficit June 30 1993 June 30 1991 68,646 $ 1,667,427,949 $ 67,583 1,636,475,536 13,028 $ 288,675,367 $ 11,458 224,370,328 $ 282,431,000 $ 239,462,000 $ (4,493,3000) $ 14,882,108 There have been no changes in the benefit provisions or in the actuarial assumptions of the Plan since the previous valuation. -19 - State of Georgia ~~, ! 1 6 ~&ldem Status of Investments - Fiscal Year 1995 POOLED INVESTMENT FUND $ 5,299,529,024 Employees' Retirement System 330,263,003 State Employees' Assurance Department 329,156,792 Public School Employees Retirement System 24,891,157 Trial Judges and Solicitors Retirement Fund 12,468,517 Legislative Retirement System $ 5,996,308,493 Total Pooled Investments Note: This report was prepared from data received from the Custodian Bank or from data maintained by the Division of Investment Services. -20 - State of Georgia ~~ ild,~f:?ydem Status of Investments STRUCTURAL ANALYSIS OF INVESTMENTS Type of Investment Short Term Investments Bonds Common Stocks Mortgages and Real Estate 1995 3% 50% 47% Nil 100% 1994 2% 50% 48% Nil 100% June 30 1993 5% 50% 45% Nil 100% 1992 3% 50% 47% Nil 100% 1991 5% 54% 41% Nil 100% RATE OF RETURN ON AVERAGE AMOUNT INVESTED FISCAL YEARS 1985 - 1995 Fiscal Year Ending June 30 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 Average Book Value (millions of dollars) $1,452 $1,719 $2,055 $2,439 $2,863 $3,299 $3,774 $4,272 $4,771 $5,285 $5,842 Average Investment Income (millions of dollars) $164.4 $191.7 $262.4 $264.5 $296.6 $349.6 $343.3 $423.2 $428.7 $509.8 $538.9 Yield 11.32% 11.15% 12.77% 10.84% 10.36% 10.60% .9.10% 9.91% 8.99% 9.65% 9.22% - 21 - Face Amount $ 187,723,000 State of Georgia ~~' . f l 6 ~ { ? ~ Status of Investments TEMPORARY INVESTMENTS - as of June 30, 1995 - Issuer United States Government Obligations . . . $ (subject to repurchase agreement due 7/3/95 Book Value 187,723,000 U.S. GOVERNMENT, CORPORATE AND OTHER BONDS Face Amount $ 2,440,000 13,902,000 2,796,000 1,344,000,000 202,000,000 1,355,000,000 495,000,000 $ 3,415,138,000 Issuer Synovus Financi General Electri T XI Mystic Mar US Treas. Bond US Treas. Bond US Treas. Note US Treas. Note Interest Rate% 8.750 Year of Maturity 2004 8.350 2004 10.000 2003 6.250 2023 7.625 2025 6.500 2005 6.250 2000 Book Value 2,440,000 13,902,000 2,796,000 1,102,823,743 198,379,762 1,252, 179,412 458,344,506 $ 3,030,865,423 -22 - State of Georgia ~+r' il6~EPrm Status of Investments COMMON STOCK HOLDINGS - as of June 30, 1995 - $ 1,508,000 600,000 395,000 280,000 980,000 505,000 290,500 927,500 140,000 455,000 328,000 385,600 75,000 110,000 80,000 140,000 250,000 132,000 167,000 770,000 1,200,000 140,000 95,000 156,000 710,000 190,000 190,000 677,000 175,000 452,000 80,000 47,000 800,000 24,000 101,000 25,000 99,000 702,500 16,500 246,500 958,000 635,000 675,000 574,000 840,000 248,000 100,000 80,000 330,000 580,000 5,680 ABBOTT LABS $ AIR PROD & CHEMS' ALBERTSON'S INC AMER EXPRESS AMER GENERAL CORP AMER HOME PROD AMER INTL GROUP AMOCO CORP AMP INC ANHEUSER-BUSCH AT&T ATLANTIC RICHFIELD AVNET AVON PRODUCTS INC BAKER HUGHES INC BELL ATLANTIC CORP BELLSOUTH CORP BLOCK, H. & R. BOEING CO BRISTOL MYERS CO BROWNING-FERRIS C PC INT INC CAPITAL CITIES ABC CHEVRON CORP CHUBB CORP COCA COLA CO COLGATE PALMOLIVE COLUMBIA/HCA HEALTHCARE C CONAGRA INC COOPER INDUSTRIES DARDEN RESTAURANTS INC DAYTON HUDSON DELUXE CHECK PRINTERS DETROIT EDISON DIEBOLD INC DISNEY, WALT DOVER CORP DOW CHEMICAL CO DOW JONES & CO DUKE POWER DUN & BRADSTREET DUPONT E I DE NEM EMERSON ELEC CO EQUIFAX EXXON CORP FEDERAL NATL MTG ASSO FINGERHUT COS FOSTER WHEELER CORP FRANKLIN RES INC GTE CORP GARDNER DENVER MACHINERY 31,530,338 15,540,826 10,569,341 5,852,923 18,500,521 24,072,152 24,595,181 44,413,724 4,396,778 18,667,094 15,626,612 40,026,294 3,242,823 6,198,290 1,721,870 7,406,022 11,427,487 4,830,422 6,910,355 38,727,377 26,117,997 6,975,563 4,660,714 5,776,345 56,075,139 6,382,690 10,235,452 12,555,136 5,014,136 18,450,763 792,198 3,688,050 26,877,636 722,636 4,355,175 922,283 5,551,717 40,703,278 471,250 7,334,472 49,327,527 27,430,194 30,477,285 13,314,026 42,138,056 15,652,363 2,461,123 2,850,051 12,246,306 17,929,869 49,743 - 23 - State of Georgia ~~ . . @ ~ { ? ~ Status of Investments COMMON STOCK HOLDINGS, continued - as of June 30, 1995- $ 670,800 80,000 429,000 533,000 45,000 470,000 94,000 63,000 75,000 789,000 885,600 1,094,166 555,000 180,000 400,000 27,700 735,000 50,000 500,000 620,000 103,000 801,000 270,000 152,000 400,000 300,000 315,000 1,483,000 800,000 841,000 1,387,000 141,000 822,000 276,000 88,000 157,400 500,200 900,000 232,000 22,000 752,000 614,000 305,000 283,000 1,062,000 585,000 650,000 207,000 150,000 429,000 165,000 GENERAL ELEC $ GENERAL MILLS GENERAL RE CORP GENUINE PARTS CO GEORGIA PACIFIC GOODYEAR TIRE & RUBBER GRAINGER, W.W. GREAT LAKES CHM HALLIBURTON HEINZ, HJ HEWLETT PACKARD CO HOME DEPOT HONEYWELL INTL BUS MACHINES INTL FLAVORS & FRAGRANCES INTL PAPER JOHNSON & JOHNSON KELLOGG KEYCORP KIMBERLY CLARK LEHMAN BROTHERS LILLY, ELI LIMITED INC LORAL CORP LUBRIZOL CORP MARSH MCLENNAN -COS INC MASCO MCDONALDS CORP MCI COMMUNICATIONS MELVILLE CORP MERCK & CO INC MILLIPORE CORP MINNESOTA MNG & MFG MOBIL CORP MOLEX MONSANTO COMPANY MOTOROLA INC NBD BANCORP NALCO CHEMICAL NATL SERVICE INDUSTRIES NORFOLK SOUTHERN NYNEX PACIFIC GAS & ELEC. PALL CORP PEPSICO INC PFIZER INC PHILIP MORRIS CO PITNEY BOWES INC PRAXAIR PROCTER & GAMBLE CO PROGRESSIVE CORP 25,418,224 3,721,489 43,243,903 9,421,845 3,091,949 16,023,041 5,704,966 3,855,768 2,622,078 28,002,523 28,142,555 38,937,791 18,510,594 15,403,734 14,329,860 1,643,189 22,155,574 2,665,696 14,289,381 32,152,432 1,414,269 44,122,815 5,600,146 5,147,070 13,825,948 19,754,506 9,154,882 28,594,858 17,077,962 34,292,738 50,683,361 7,286,910 33,382,578 17,803,183 2,804,887 11,157,845 19,528,122 28,481,984 7,488,843 569,391 38,664,703 23,461,401 8,217,499 4,619,852 34,335,080 33,911,626 33,275,039 7,315,721 3,398,985 13,172,579 6,046,876 - 24 - State of Georgia ~~ .@e1:&emen1EfP~ Status of Investments COMMON STOCK HOLDINGS, continued - as of June 30, 1995 - $ 465,000 275,000 540,000 111,000 530,000 195,000 185,000 437,700 755,000 1,218,000 167,500 262,000 530,000 124,000 176,000 1,299,000 570,000 205,000 850,000 12,000 144,000 97,000 605,000 910,000 618,000 12,000 1,780,000 487,000 684,000 532,000 2,027,000 130,000 PROVIDIAN CORP RALSTON PURINA GROUP RAYTHEON CO READERS DIGEST ASSN ROADWAY SVCS INC RUBBERMAID RUSSELL CORP SAFECO CORP SARA LEE CORP SCHERING PLOUGH CORP SCHULMAN (A.) INC SCIENTIFIC-ATLANTA SPRINT STANLEY WORKS SUNTRUST BANKS INC SUPERVALU STORES SYSCO CORP1 TENNECO TIMES MIRROR TORCHMARK CORP TRINITY INDS INC TYCO LABS UNION PACIFIC UNITED HEALTHCARE CORP UNITED TECHNOLOGIES VF CORP WAL-MART STORES INC WARNER LAMBERT CO WESTVACO WHIRLPOOL WMX TECHNOLOGY XEROX CORP IN-HOUSE FUNDS TOTAL COMMON STOCK HOLDINGS $ 13,944,883 10,697,784 11,974,600 4,869,708 21,694,739 4,996,468 5,460,361 19,151,589 18,178,245 46,373,091 4,479,493 3,992,256 14,983,884 4,940,096 6,718,805 31,624,420 14,069,171 7,974,559 16,345,229 396,618 4,752,428 4,409,646 32,481,371 34,682,044 29,539,877 487,089 35,726,757 33,942,204 21,497,763 17,316,784 58,606,055 10,265,809 612,924,455 $ 2,845,222,135 - 25 - State of Georgia -6~' .@ewrom,MUEJP~ Status of Investments PURCHASES OF LONG-TERM FIXED-INCOME INVESTMENTS - Fiscal Year 1995 Pooled Investment Fund Face Amount Issuer Type of Security Coupon Rate% Year of Maturity Average Yield% Moody's Bond Rating* $ 66,000,000 . $ 77,000,000 . $ 35,000,000 . $ 20,000,000 . $ 45,000,000 . $ 20,000,000 . $ 40,000,000 . $ 30 000 000 . US TREAS. BOND US TREAS. BOND US TREAS. BOND US TREAS. NOTE US TREAS. NOTE US TREAS. NOTE US TREAS. NOTE US TREAS. NOTE . . Bonds . . . . . . 6.250 ... Bonds . . . 7.500 ... Bonds ...... 7.625 . Notes ...... 7.250 ... Notes ...... 7.500 Notes . . . . 6.750 .. Notes .. 6.500 . .. Notes ...... 6.250 ..... 2023 2024 ...... 2025 ........ 2004 ....... 2005 .... 2000 .... 2005 .. 2000 .......... 7.514 . .. T ... 7.939 . T ........... 7.557 ......... T . . .. 7.324 . .. T .......... 7.093 ......... T .......... 6.661 ......... T .......... 6.515 ......... T ........ 6.108 . . . . . . . . T $333 000 000 NOTE: *T indicates obligations of U.S. Government. MORTGAGES AND OTHER SECURED NOTES - as of June 30, 1995 - Borrower and Mortgaged Property Int. Rate% Year Last Pmt. Due Balance Out-standing on Loan WEST & ABBITT BENT CREEK COL APTS 9.5000 2004 713,586 ADAIR JACK PENNEY BLDG ATLANTA 7.875 2001 1,396,332 2109 918 REAL ESTATE INVESTMENTS - as of June 30, 1995 - Description of Property Book Value Comments BETA BUILDING TWO NORTHSIDE 75 ATL (Constitutes onehalf interest in property) 2,522,905 Presently houses the offices of Employees' and Teachers Retirement System. The Employees' Retirement System on 7/1/76 acquired a 50% interest in the building. -26- State of Georgia ,6m~' _{,e4rom