2001 annual report [2001]

2

0

ANNUAL

o

1

REPORT

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED fINANCIAL STATEMENTS AS Of AND fOR THE YEARS ENDED JUNE 30, 2001 AND 2000

e. SCJRF is a defined benefit pension plan established by the Georgia General Assembly in 1945 for the purpose of providing retirement benefits to the superior court judges of the State of Georgia. SCJRF is directed by its own Board of Trustees. The Boards of Trustees for ERS and SCJRF entered into a contract for ERS to administer the plan effective July 1, 1995.

f. DARF is a defined benefit pension plan established by the Georgia General Assembly in 1949 for the purpose of providing retirement benefits to the district attorneys of the State of Georgia. DARF is directed by its own Board of Trustees. The Boards of Trustees for ERS and DARF entered into a contract for ERS to administer the plan effective July 1, 1995.

Membership - As of June 30, 2001, participation in

SCJRF is as follows:

Retirees and beneficiaries currently receiving benefits

33

Active plan members

'Ibtal

Employers

_1

Membership - As of June 30, 2001, DARF had 9 retirees and beneficiaries currently receiving benefits.
Benefits - Persons appointed as district attorney emeritus shall receive an annual b~nefit of $15,000 or one-half of the state salary received by such person as a district attorney for the calendar year immediately prior to the person's retirement, whichever is greater.

Benefits - The normal retirement for SCJRF is age 68 with 19 years of creditable service with a benefit of twothirds the salary paid to su perior court judges. A member may also retire at age 65 with a minimum of 10 years of creditable service with a benefit of one-half the salary paid to superior court judges. Death, disability, and spousal benefits are also available.

Contributions and Vesting - Member contributions were 5.0% of their annual salary plus an additional 2.5% for the spousal coverage benefit if elected. The State paid member contributions of 5.0% of the member's annual salary. Additional employer contributions are not actuarially determined but are provided on an as-needed basis to fund current benefits.

Contributions and Vesting - Member contributions are 5.0% of their salary plus an additional 2.5% for the spousal coverage benefit if elected. The State pays member contributions of 5.0% of the member's annual salary. Additional employer contributions are not actuarially determined but are provided on an as-needed basis to fund current benefits.

g. GDCP is a defined contribution plan established by the Georgia General Assembly in July 1992 for the purpose of providing retirement allowances for state employees who are not members of a public retirement or pension system. GDCP is administered by the ERS Board of Trustees.
Membership (As of June 30, 2001, participation in GDCP is as follows:

-32-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30,2001 AND 2000

Membership - As of June 30, 2001, participation in

GDCP is as follows:

Terminated employees entitled to benefits but not yet

receiving benefits

59,075

Active plan members

Employers
Benefits - A member may retire and elect to receive periodic payments after attainment of age 65. The payments will be based upon mortality tables and interest assumptions to be adopted by the ERS Board of Trustees. If a member has less than $3,500 credited to his/her account, the ERS Board of Trustees has the option of requiring a lump sum distribution to the member. Upon the death of a member, a lump sum distribution equaling the amount credited to his/her account will be paid to the member's designated beneficiary.
Contributions - Members are required to contribute 7.5% of their annual salary. There are no employer contributions. Earnings will be credited to each member's account as adopted by the ERS Board of Trustees. Upon termination of employment, the amount of the member's account is refundable upon request by the member.
h. SEAD was created in 1953 by the Georgia General Assembly to furnish survivors' benefits for eligible members of ERS. SEAD contracts with ERS and LRS to provide group term life insurance coverage for their participants. Death benefit payments are payable to the beneficiary or estate of the insured individual.

3. SIGNIFICANT ACCOUNTING POLICIES AND SYSTEM ASSET MATTERS
The following is a summary of significant accounting policies of the System:
a. Basis of Accounting - The System's combined financial statements are prepared on the accrual basis of accounting. Contributions from the employers and members are recognized as additions in the period in which the members provide services. Retirement and refund payments are recognized as deductions when due and payable.
b. Investments - Investments are reported at fair value. Short-term investments are reported at cost, which approximates fair value. Securities traded on a national or international exchange are valued at the last reported sales price. Investment income is recognized as earned by the System.
No investment in anyone organization except the U.S. Government represents 5% or more of the net assets available for pension benefits.
There are no investments in, loans to, or leases with parties related to the System.
c. Real Estate Investments - An office building that is included in mortgage loans and real estate is owned equally by the System and the Teachers Retirement System of Georgia. The System incurred approximately $341,000 and $339,000 in rental expense for the years ended June 30, 2001 and 2000, respectively, which is included in administrative expenses. The remainder of the building is leased to outside parties, and the rental revenue is included in interest and dividends.

-33-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

TABLE OF CONTENTS
INTRODUCTION
BOARD OF TRUSTEES PAST DIRECTORS
MANAGERS AND STAFF
3-4
LETTER OF TRANSMITTAL
5
ACTUARIAL SUMMARY
EMPLOYEES' RETIREMENT SYSTEM
6
PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM
9
LEGISLATIVE RETIREMENT SYSTEM
12
GEORGIA JUDICIAL RETIREMENT SYSTEM
15
GROUP TERM LIFE INSURANCE (GTLI)
18
INVESTMENTS
POOLED INVESTMENT FUND STRUCTURAL ANALYSIS RATE OF RETURN
21
TEMPORARY INVESTMENT BON DS
22
COMMON STOCK HOLDINGS MORTGAGE
REAL ESTATE INVESTMENT
23
AUDITED FINANCIAL STATEMENTS
TABLE OF CONTENTS
24
INDEPENDENT AUDITOR'S REPORT
25
BALANCE SHEETS HISTORICAL TREND INFORMATION
SUPPLEMENTARY INFORMATION ADDITIONAL INFORMATION
26-44
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

BOARDS OF TRUSTEES

Ray Crawford, Jr. Executive Director State Properties Commission Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security Trust Fund Georgia Defined Contribution Plan
Russell W. Hinton, exofficio ViceChairman State Auditor
Employees' Retirement System Public School Employees Retirement System
Georgia Judicial Retirement System Legislative Retirement System
State Social Security Trust Fund Georgia Defined Contribution Plan State Employees' Assurance Department
Michael D. Kennedy Chairman
Kont/Ferry Intentational Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security Trust Fund Georgia Defined Contribution Plan State Employees' Assurance Department
Michael Thurmond, ex-officio Commissioner of Labor
State Employees' Assurance Department

Dan Ebersole, ex-officio Director Office of TYeasury & Fiscal Services Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security Trust Fund Georgia Defined Contribution Plan State Employees' Assurance Department
Robert E. Keller District Attorney Clayton Judicial Circuit Georgia Judicial Retirement System
William F. Roberts Retired Director, Georgia State Finance & Investment Commission Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security 'Irust Fund Georgia Defined Contribution Plan
Kelly D. Thrner State Court Judge Lowndes County Georgia Judicial Retirement System

Barbara Ward Financial Manager City of Atlanta, Department of Finance Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security Trust Fund Georgia Defined Contribution Plan
Cynthia D. Wright Superior Court Judge Superior Court of Fulton County Georgia Judicial Retirement System

Bonnie T. Wright AttorneyatLaw Schulten Ward & 'Iltrner State Employees' Assurance Department
Marjorie Young, ex-officio Commissioner State Merit System Employees' Retirement System Public School Employees Retirement System Georgia Judicial Retirement System Legislative Retirement System State Social Security 'Irust Fund Georgia Defined Contribution Plan State Employees' Assurance Department

-3-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

INTRODUCTION
On the occasion of the 50th anniversary of the Employees1 Retirement System of Georgia1 we would like to recognize
past directors and long serving staff and express our appreciation for their dedication.
PAST DIRECTORS

*w. Frank Delamar
1950-1972

*Abraham Domain 1972-1988

W. Rudolph Johnson 1988-2000

MANAGERS AND STAff

Left to Right: Danise Thaxton, Confidential Secretary and Betty Frazier, Special Assistant to the Director

ight: Standing - Sheila Render, Stephen Boyers, Diane Clark, enkins, Seated - Richard Jones, Michelle Hebert, Cedric Williams

Charles W. Cary,

Director Division of

d

Investment Services

-4-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

LETTER OF TRANSMITTAL

It is my pleasure to join the Boards of Trustees and staff in celebrating the 50th Anniversary of the Employees' Retirement System. In presenting the 2001 Annual Report, we acknowledge the foundation for our success: many years of service from the previous directors, Frank Delamar (deceased), Abe Domain (deceased), and Rudolph Johnson; a dedicated staff; and an investment division par excellence.
By statute, the staff of ERS administers seven separate and distinct systems:
~ Employees' Retirement System of Georgia ~ Public School Employees' Retirement System ~ Legislative Retirement System ~ Georgia Judicial Retirement System ~ Georgia Defined Contribution Plan ~ State Employees' Assurance Department (GTLI) ~ State Social Security contracts with political
subdivisions
This annual report includes 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; and the auditors' report from Deloitte & Touche.
INVESTMENTS At ERS' inception, legislation authorized the use of both equities and bonds. Thus, the investments of ERS have been forward thinking and always have included a diverse portfolio of bonds and equities. In the early days, trust funds were managed by a sole custodian bank. In 1974, the in-house Division of Investment was created; and in 1983 multiple outside advisers became a part of the investment team.

Cecelia Corbin Hunter Director Employees' Retirement System
The Division of Investment often outperforms the market. At the end of 1981, the market value of our trust funds was $719 million; at the end of 1991, ten years later, our ending market value was $5.2 billion. After another ten years, at the end of 2001, our ending market value was $14 billion. ERS is a fully funded, world-class retirement system.
The ERS staff joins me in expressing our sincere thanks to the Boards of Trustees for their leadership. We appreciate the support of the Governor, Lieutenant Governor, Retirement Committee Chairmen of the Georgia General Assembly House of Representatives and Senate, and departmental officials. With this continued support, and the diligence of our staff, we can assure our members and retirees that we have a successful operation providing protection and financial soundness to the retirement system.
ri~~#~
Cecelia Corbin Hunter, Director

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EMPLOYEES' RETIREME T SYSTEM OF GEORGIA

ACTUARIAL SUMMARY EMPLOYEES' RETIREMENT SYSTEM
ACTUARY'S CERTIFICATION LETTER
Bue'
CONSULTANTS
A Mellon Consulting Company
200 Galleria Parkway, N.W. Suite 1900 Atlanta, Georgia 30339-5945
October 9, 2001 Board of Trustees Employees' Retirement System of Georgia Suite 300, Two Northside 75 Atlanta, Georgia 30318 Attention: Ms. Cecelia Corbin Hunter, Executive Director
Members of the Board: 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 tables last adopted by the Board of Trustees. We have submitted the report giving the results of the actuarial valuation of the System prepared as of June 30, 2000. The report indicates that annual employer contributions at the rate of 5.66% of compensation for Old Plan members and 10.41 % for New Plan members are sufficient to support the benefits of the System. In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the report and the supporting schedules in the actuarial section. The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Government Accounting Standards Board (GAS B) Statement Nos. 25 and 27. The funding objective of the plan is that contribution rates over time will remain level as a percent of payroll. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a level percent of payroll. Gains and losses are reflected in the unfunded accrued liability which is negative and being amortized as a level percent of payroll within a 40-year period as a credit against the normal contribution rate. The Retirement System is being funded in 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 on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated. This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience is performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Edward A. Macdonald Principal and Consulting Actuary EAM:ws
Buck Consultants, Inc.
no 1955-2488 no Fax 1933-8336
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARlAL SUMMARY EMPLOYEES' RETIREMENT SYSTEM

VA LU AT ION BA LA NeE SHE ET - as of June 30, 2000 - dollar am.ounts 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 disability 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 members = contributions Total
(3) 'Ibtal Actuarial Liabilities

4,270,385 379,266 121 268

$ 4,770,919

$ 8,777,148 57395

8,834,543 $ 13,605,462

PRESENT AND PROSPECTIVE ASSETS

(4) Actuarial value of assets

(5) Present value of total future contributions = (3) - (4)

$ 2,605,561

(6) Present value of future member contributions and employer paid member contributions

(7) Present value of future employer contributions (5) - (6)

$ 1,177,298

(8) Employer normal contribution rate

6.51%

(9) Present value of future payroll (1 %)

$ 246,358

(10) Prospective normal contributions = (8) x (9)

(11) Prospective unfunded accrued liability contributions (7) - (10)

(12) 'Ibtal Present and Prospective Assests

$ 10,999,901 1,428,263
1,603,791 (426,493) $ 13,605.462

EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY EMPLOYEES' RETIREMENT SYSTEM

SUMMARY OF PRINCIPAL RESULTS -as of June 30, 2000-dollaramountsinthousands

VALDATIO DATE
Active members: Number Annual Compensation
Retired members and beneficiaries: Number Annual allowances
Assets: Market Value Actuarial Value
Unfunded actuarial accrued liability
Amortization Period

June 3D. 2000 June 3D. 1999

75,318

73,009

$ 2,304,289 $ 2,152,072

24,488 $ 480,380

23,126 411,946

$ 13,301,163 10,999,901

$ 12,572,600 9,848,723

$ (426,493) $ (153,109)

40 years

40 years

For Fiscal Year Ending
Annual required employer contribution rates (ARC):
Old Plan Normal Accrued Liability Total
New Plan Normal (includes 4.75% paid for member) Accrued liability Total

June 30, 2002 June 30, 2001

6.51% (0.85) 5.66%
11.26% (0.85)
10.41 %

6.59% (0.33) 6.26%
11.34% (0.33) 11.01 %

The valuation reflects 1.5% Ad Hoc COLAs effective July 1, 2001 and Januwy 1, 2002.

-8-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM
ACTUARY'S CERTIFICATION LETTER
BUC' CONSULTANTS
A Mellon Consulting Company
200 Galleria Parkway, N.W. Suite 1900 Atlanta, Georgia 30339-5945
October 9, 2001 Board of Trustees Georgia Public School Employees' Retirement System Suite 300, Two Northside 75 Atlanta, Georgia 30318 Attention: Ms. Cecelia Corbin Hunter, Executive Director Members of the Board: 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 actuarial valuation of the System prepared as of June 30, 2000. The report indicates that an annual employer contribution at the rate of 8320.97 per active member is sufficient to support the benefits of the System. In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the report and the supporting schedules in the actuarial section. The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Government Accounting Standards Board (GAS B) Statement Nos. 25 and 27. The funding objective of the plan is that contribution rates over time will remain level as a dollar per active member. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a level dollar per active member. Gains and losses are reflected in the unfunded accrued liability which is negative and being amortized as a level dollar per member within a 40-year period as a credit against the normal contribution rate. The Retirement System is being funded in 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 on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated. This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience is performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
Edward A. Macdonald Principal and Consulting Actuary EAM:ws
Buck Consultants, Inc. 770 \955-2488 Fax 7701933-8336
-9-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM

VA LUAT ION BA LAN C E SHE ET - as of June 30, 2000 - dollar am.ounts in thousands

ACTUARIAL LIABILITIES
(1) Present value of prospective benefits payable on account of present retired members, beneficiaries of deceased members, and terminated 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) Thtal Actuarial Liabilities

$ 341,797,866

$ 352,951,278 32,283,056 3.198.122

$ 388.432.456

$ 730,230,322

PRESE T AI D PROSPECTIVE ASSETS

(4) Actuarial value of assets

$ 667,642,000

(5) Present value of total future contributions = (3) - (4)

$ 62,588,322

(6) Present value of future member contributions to the Members' Contributions Funds

8,886,564

(7) Present value of future employer contributions to the Pension Accumulation Fund = (5) - (6)

$ 53,701,758

(8) Employer normal contribution rate

$

429.36

(9) Present value of future membership service

246,849

(10) Prospective normal contributions = (8) x (9)

105,987,087

(11) Prospective unfunded accrued liability contributions = (7) - (10) (12) Thtal Present and Prospective Assests

(52 285.329) $ 730,230,322

-10-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY PUBLIC SCHOOL EMPLOYEES' RETIREMENT SYSTEM

SUMMARY OF PRINCIPAL RESULTS -asofJune30, 2000-dollaramountsinthousands

V ALUATION DATE
Active members: Number
Retired members and beneficiaries: I umber Annual allowances
Assets: Market Value Actuarial Value
Unfunded actuarial accrued liability
Amortization period

June 30, 2000 June 30, 1999

36,182

32,898

11,394 $ 29,388,547*

11,112 $ 28,145,875*

$ 813,296,000 667,642,000

$ 770,280,000 599,464,000

$ (52,285,329) $ (13,112,013)

40 years

40 years

For Fiscal Year Ending
Employer contribution rate per active member: Normal Accrued liability Total
Annual required employer contributions (ARC): Normal Accrued liability Total
Annual appropriation

June 30, 2002 June 30, 2001

$

429.36 $

(108.39)

$

320.97

421.23 (29.90) 391.33

$ 15,535,104 (3.921 878) 11,613,226
$ 12,874,104

$ 13,857,625 (983.521)
$ 12,874,104
$ 17,017,000

The valuation takes into account the effect of amendments to the System enacted through the 2001 session of the General Assembly.
*Does not include increase in benefit accrual rate effective July 1, 2000. The results of the valuation have been adjusted to include this increase.

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EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY LEG IS LATIVE RETI REM ENT SYSTEM
ACTUAR.Y'S CER.TIFICATION LETTER.
Bucr
CONSULTANTS
A Mellon Consulting Company
200 Galleria Parkway, N.W. Suite 1900 Atlanta, Georgia 30339-5945
December 31, 2002 Board of Trustees Georgia Legislative Retirement System Suite 300, Two Northside 75 Atlanta, Georgia 30318 Attention: Mrs. Cecelia Corbin Hunter, Executive Director Members of the Board: 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 giXing the results of the actuarial valuation of the System prepared as of June 30, 2000. The report indicates that no employer contributions are required to support the benefits of the System. In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the report and the supporting schedules in the actuarial section. The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Government Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of the plan is that contribution rates over time will remain level as a dollar per active member. The valuation method used is the unit credit cost method. The normal contribution rate to cover current cost has been determined as a dollar per active member. Gains and losses are reflected in the unfunded accrued liability which is negative and being amortized as a credit equal to the normal contribution rate. The Retirement System is being funded in 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 on an actuarially sound basis. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated. This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience is performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
;?~
Edward A. Macdonald Principal and Consulting Actuary EAM:ws
Buck Consultants, Inc. 7701955-2488 Fax 7701933-8336
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EMPLOYEES' RETIREME T SYSTEM OF GEORGIA

ACTUARIAL SUMMARY LEGISLATIVE RETIREMENT SYSTEM

VALUATION BALANCE SHEET -asofJurze30, 2000
ACTUARIAL LIABILITIES
Present value of prospective benefits payable on account of: (1) Present retired members, beneficiaries of deceased
members, and members entitled to vested benefits
(2) Present active members: Service retirement allowances Disability retirement allowances Survivor allowances Refunds of members' contributions Total
(3) 'Ibtal Actuarial Liabilities

$ 15,620,590
$ 7,639,294 526,244 371,710 284890 $ 8,822.138
$ 24.442,728

PRESENT AND PROSPECTIVE ASSETS (4) Actuarial value of 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 (5) - (6) (8) Prospective normal contributions (9) Prospective unfunded actuarial accrued liability
contributions = (7) - (10) (10) 'Ibtal Present and Prospective Assests

$ 24,666,000 $ (223,272)
1,080,536 $ (1,303,808)
$ 1,734,502
(3.038.310) $ 24.442,728

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EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY LEGISLATIVE RETIREMENT SYSTEM

SUMMARY OF PRiNCIPAL RESULTS -asofJune30, 2000

VALUATION DATE
Number of Active members
Retired members and beneficiaries: Number Annual allowances
Assets: Market Value Actuarial Value
Unfunded actuarial accrued liability (surplus)
Amortization period

June 30. 2000 June 30. 1999

210

210

189 $ 1,056,360

190 $ 1,057,265

29,525,000 24,666,000
$ (3,038,310)
N/A*

$ 29,358,000 22,679,000
$ (2,550,350)
N/A*

For Fiscal Year Ending
Employer contribution rate per active member: Normal Accrued liability Total
Annual required employer contributions (ARC): Normal Accrued Liability Total

June 30, 2002 June 30, 2001

$ 780.23 $

507.53

(780.23)

(507.53)

$

0.00

0.00

$ 163,848

(163.848)

$

0.00

106,581

(106,581)

$

0.00

* If the annual required employer contribution (ARC) is based on 40 year amortization of the unfunded accrued liability, the ARC is less than $0, which is not allowed under GASB 25/27. Therefore, tht; accrued liability contribution has been set such that the total ARC equals $0.
The valuation takes into account the effect of amendments to the System enacted through the 2000 session of the General Assembly.
The valuation reflects an iJ1crease in the benefit accrual rate for active and retired members from $28 to $32.

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EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY
GEORGIA JUDICIAL RETIREMENT SYSTEM
ACTUARY'S CERTIFICATiON LETTER
BU('
CONSULTANTS
A Mellon Consulting Company
200 Galleria Parkway, N.W. Suite 1900 Atlanta, Georgia 30339-5945
October 9, 2001 Board of Trustees Georgia Judicial Retirement System Suite 300, Two Northside 75 Atlanta, Georgia 30318 Attention: Ms. Cecelia Corbin Hunter, Executive Director Members of the Board: Section 47-23-21 of the Code of Georgia which governs the operation of the Georgia Judicial 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 actuarial valuation of the System prepared as of June 30, 2000. The report indicates that no employer contributions are required to support the benefits of the System. In preparing the valuation, the actuary relied on data provided by the System. While not verifying data at the source, the actuary performed tests for consistency and reasonableness. Our firm, as actuary, is responsible for all of the actuarial trend data in the financial section of the report and the supporting schedules in the actuarial section. The System is funded on an actuarial reserve basis. The actuarial assumptions recommended by the actuary and adopted by the Board are in the aggregate reasonably related to the experience under the System and to reasonable expectations of anticipated experience under the System. The assumptions and methods used for funding purposes meet the parameters set for the disclosures presented in the financial section by Government Accounting Standards Board (GASB) Statement Nos. 25 and 27. The funding objective of the plan is that contribution rates over time will remain level as a percent of payroll. The valuation method used is the entry age normal cost method. The normal contribution rate to cover current cost has been determined as a level percent of payroll. Gains and losses are reflected in the unfunded accrued liability which is negative and being amortized as a level percent of payroll within a 12-year period as a credit against the normal contribution rate. The Retirement System is being funded in conformity with the minimum funding standard set forth in Code Section 47-20-10 of the Public Retirement Systems Standards Law. Assuming that contributions to the System are made by the employer from year to year in the future at the rates recommended on the basis of the successive actuarial valuations, the continued sufficiency of the retirement fund to provide the benefits called for under the System may be safely anticipated. This is to certify that the independent consulting actuary is a member of the American Academy of Actuaries and has experience is performing valuations for public retirement systems, that the valuation was prepared in accordance with principles of practice prescribed by the Actuarial Standards Board, and that the actuarial calculations were performed by qualified actuaries in accordance with accepted actuarial procedures, based on the current provisions of the retirement system and on actuarial assumptions that are internally consistent and reasonably based on the actual experience of the System.
47~
Edward A. Macdonald Principal and ConSUlting Actuary EAM:ws
Buck Consultants, Inc.
no 1955-2488 Fax no 1933-8336
-15-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY
GEORGIA JUDICIAL RETIREMENT SYSTEM

VALUATION BALANCE SHEET - as ofJuly 1,2000
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) Thtal Actuarial Liabilities

$ 43,316,116 $ 185,326,737 $ 228.642.853

PRESENT AND PROSPECTIVE ASSETS (4) Actuarial value of 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 unfunded actuarial accrued liability
contributions = (7) - (10) (12) Thtal Present and Prospective Assests

$ 204,136,000

$ 24,506,853

25,934,858

$ (1,428,005)

$

19.98%

3,217,245

64,280,555

(65,708,560) $ 228.642.853

GEORGIA JUDICIAL RETIREMENT SYSTEM

SUMMARY OF PRlNClPAL RESULTS -asofJuly1, 2000
VALUATION DATE
Active members: Number Annual Compensation
Retired members and beneficiaries: Number Annual allowances
Assets: Market Value Actuarial Value
Unfunded actuarial accrued liability
Amortization period

July 1, 2000

July 1, 1999

416 $ 34,855,836

403 $ 29,593,641

116

114

$ 4,561,959 $ 4,194,492

239,644,000 204,136,000

$ 226,084,000 183,249,000

$ (65,708,156) $ (54,015,703)

12 years

17 years

For Fiscal Year Ending
Annual required employer contribution rates (ARC): Normal Accrued liability Total

June 30, 2002 June 30, 2001

19.98% (19.98) 0.00%

19.41% (14.79) 4.62%

The valuation takes into account the effect of amendments to the System enacted through the 2001 session of the General Assembly. The valuation reflects the 1.5% Ad Hoc COLA's effective July 1, 2001 and January 1, 2002.

-16-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

-17-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARIAL SUMMARY G RO U PTE RM LIF E INS U RAN C E
ACTUARY'S CERTIFICATION LETTER
BUC"
CONSULTANTS
A Mellon Consulting Company
200 Galleria Parkway, N.W. Suite 1900 Atlanta, Georgia 30339-5945
October 9, 2001
Board of Trustees Employees' Retirement System of Georgia Two Northside 75 Atlanta, GA 30318 Attention: Ms. Cecelia Corbin Hunter, Executive Director Members of the Board: 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, 2000. The report indicates that combined employer and employee contributions at the rate of 0.75% of active payroll for Old Plan members and 0.50% of active payroll for New Plan members 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,
Edward A. Macdonald Principal, Consulting Actuary EAM:sr
Buck Consultants, Inc.
no no 1955-2488 Fax 1933-8336
-18-
EMPLOYEES' RETIREME T SYSTEM OF GEORGIA

ACTUARIAL SUMMARY
GROUP TERM LIFE INSURANCE
VALUATION BALANCE SHEET -asofJune30, 2000
ACTUARIAL LIABILITIES (1) Present value of prospective benefits payable on account
of present retired members (2) Present value of prospective benefits payable on account
of present active members (3) Thtal Actuarial Liabilities
PRESE JT AND PROSPECTIVE ASSETS (4) Actuarial value of assets (5) Present value of future member premiums (6) Present value of future employer contributions (7) Total present assets and present value of future employee
premiums and employer contributions (8) Actuarial (Surplus) Deficit (9) Thtal Present and Prospective Assests

$ 203,178,435 $ 587380.216 $ 790.558.651
$ 700,123,000 $ 80,077,133
76.049.725 $ 856,249,858 $ (65.691.207) $ 790.558.651

-19-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

ACTUARlAL SUMMARY
GROUP TERM LIFE INSURANCE

SUM MA RY 0 F P RINC I PAL RES U LT S - as offune 30, 2000

VALUATION DATE
Active members: Number Annual compensation
Retired members: Number Insurance amount
Assets: Market Value Actuarial Value
Actuarial (surplus) deficit
Contribution rates:
Old Plan Members Employee Employer Total
New Plan Members Employee Employer Total

June 30, 2000

June 30. 1999

75,318 $ 2,304,289,449

73,009 $ 2,152,071,587

18,964 $ 580,395,780

18,195 517,717,048

$ 846,072,000 700,123,000
$ (65,691,207)

$ 790,465,000 618,777,000
(75,086,910)

0.50%* 0.25 0.75%
0.25% 0.25 0.50%

0.50% * 0.25 0.75%
0.25% 0.25 0.50%

* 0 25 % paid by employer

lNVESTMENTS

P0 0 LED I N V EST MEN T fUN 0 - fiscal year 2001

$ 12,228,417,000 788,542,000 743,875,000 27,487,000 1,718,000 22,333,000 223.334.000
$ 14,035,706,000

Employees' Retirement System State Employees' Assurance Department Public School Employees Retirement System Legislative Retirement System Superior Court Judges Retirement Fund* Georgia Defined Contribution Plan Georgia Judicial Retirement System 'Ibtal Pooled Investments at Fair Value

* The Superi.or Court Judges Retirement Fund was closed on December 31, 1976. As of June 30, 2000 there were two active members remaining in the Fund with retirement payments funded through Department of Administrative Services appropriations.

STRUCTURAL ANALYSIS Of INVESTMENTS AT fAIR VALUE

Type of Investment Short Term Investments Bonds Common Stocks Morgages and Real Estate

June 30, 2001 2%
41% 57%
100%

-20-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

-21-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDlTED FINANClAL STATEMENTS
TABLE OF CONTENTS
EMPLOYEES' RETiREMENT SYSTEM OF GEORGIA (Including All Funds and SystemB Administered by t1'le Employees' Retirement System of Georgia)
Combined financial statements as of and for the years ended June 30, 2001 and 2000, required supplementary schedules and additional information as of and for the years ended June 30, 2001 and 2000, and independent auditors' report

INDEPENDENT AUDITORS' REPORT
COM BIN ED F I NANC IAL STATEM ENTS AS OF AN D FO R TH E YEARS ENDED JUNE 30, 2001 AND 2000:
Combined Statements of Net Assets Combined Statements of Changes in Net Assets Notes to Combined Financial Statements
REQl.JIRED SUPPLEMENTARY SCHEDULES:
Schedule of Funding Progress Schedule of Employer Contributions Notes to Required Supplementary Schedules
ADDlTiONAL lNFORMATION AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000:
Combining Statements of Net Assets Superior Court Judges and District Attorneys Retirement Funds Combining Statements of Net Assets Combining Statements of Changes in Net Assets Superior Court Judges and District Attorneys Retirement Funds Combining Statements of Changes in Net Assets Administrative Expense Fund - Contributions and Expenses

Page 25
26 27 28
37 38 39
40
41
42 43 44

-24-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FlNANCIAL STATEMENTS
INDEPENDENT AUDITORS' REPORT
Deloitte &Touche
Deloitte & Touche LLP 191 Peachtree Street, N.W. Suite 1500 Atlanta, Georgia 30303-1924 www.us.deloitte.com
Board of Trustees Employees' Retirement System of Georgia:
We have audited the accompanying combined statements of net assets of the Employees' Retirement System of Georgia, including all funds and systems administered by the Employees' Retirement System of Georgia (collectively the "System"), as of June 30, 2001 and 2000, and the related combined statements of changes in net assets for the years then ended. These combined financial statements are the responsibility of the System's management. Our responsibility is to express an opinion on these combined financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the combined financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the combined financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such combined financial statements present fairly, in all material respects, the combined net assets of the System as of June 30, 2001 and 2000, and the combined changes in net assets for the years then ended in conformity with accounting principles generally accepted in the United States of America.
Our audits were conducted for the purpose of forming an opinion on the basic combined financial statements taken as a whole. The required supplementary schedules and additional information listed in the Table of Contents are presented for purposes of additional analysis and are not a required part of the basic combined financial statements. These required supplementary schedules and additional information are the responsibility of the System's management. Such information has been subjected to the auditing procedures applied in our audits of the basic combined financial statements and, in our opinion, is fairly presented in all material respects when considered in relation to the basic combined financial statements taken as a whole.
Deloitte & Touche LLP March 15, 2002
-25-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
COMBINED FINANCIAL STATEMENTS Of NET ASSETS JUNE 30, 2001 AND 2000 UN THOUSANDS)

EMPLOYEES' RETiREMENT SYSTEM OF GEORGIA (Including All Funds and Systems Administered by the Employees' Retirement System of Georgia)

ASSETS

2001

2000

CASH

$

1,546

$

1,332

RECEIVABLES: Employee and employer contributions Interest and dividends

36,986 93.956

35,950 103.135

Total receivables

130,942

139,085

INVESTMENTS - at fair value: Short-term Obligations of the U.S. Government and its agencies, corporate, and other bonds Common stocks Mortgage loans and real estate

214,837
5,822,463 8,014,283
4.351

131,785
5,623,800 9,375,961
4.373

Thtal investments

14.055.934

15.135.919

Total assets

14,188,422

15,276,336

LIABILITIES Accounts payable and other
Thtalliabilities NET ASSETS HELD IN TRUST FOR PENSION BENEFITS (A schedule of funding progress is presented on page 36.) See notes to combined financial statements.

10430 10.430 $14.177.992

8.866 8.866 $15.267.470

-26-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
COMBINED FINANCIAL STATEMENTS OF CHANGES IN NET ASSETS YEARS ENDED JUNE 30, 2001 AND 2000 (IN THOUSANDS)

EMPLOYEES' RETiREMENT SYSTEM OF GEORGIA (Including All Funds and Systems Adm,inistered by the Employees' Retirement System of Georgia)

NET ASSETS HELD IN TRUST FOR PENSION BENEFITS Beginning of year

$15,267,470

ADDITIONS: Contributions: Employer Employee Insurance premiums Administrative expense allotment Investment Ooss) income: Net (depreciation) appreciation in fair value of investments Interest and dividends Total investment Ooss) income

335,988 72,448 13,813 940
(1,379,000) 479.631
(899,369)

Less investment expenses

11.286

Net investment Ooss) income

(910.655)

Total additions

(487.466)

DEDUCTIONS: Retirement payments Refunds of employee contributions and interest Death benefits Administrative expenses

560,572 14,998 18,017 8.425

Total deductions

602.012

NET (DECREASE) INCREASE

(1.089.478)

NET ASSETS HELD IN TRUST FOR PENSION BENEFITS End of year

$14177.992

$14,422,057
323,325 70,474 17,413 737
494,234 487.727 981,961
12.044 969.917 1.381.866
496,830 15,474 15,921 8.228
536.453 845413
$15.267.470

See notes to combined financial statements.

-27-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30.2001 AND 2000
(Including A 11 Funds and Systems Adm.inistered by the Employees' Retirement System of Georgia)

1. GENERAL The accompanying combined financial statements of Employees' Retirement System of Georgia, including a11 funds and systems administered by the Employees' Retirement System of Georgia (co11ectively the "System"), is comprised of the Employees' Retirement System of Georgia ("ERS"), Public School Employees' Retirement Systems ("PSERS"), Legislative Retirement System ("LRS"), Georgia Judicial Retirement System ("GJRS"), Superior Court Judges Retirement Fund ("SCJRF"), District Attorneys Retirement Fund ("DARF"), Georgia Defined Contribution Plan ("GDCP"), and State Employees' Assurance Department ("SEAD"). All significant accounts and transactions among the various systems, departments, and funds have been eliminated.
In evaluating how to define the System for financial reporting purposes, the management of the System has considered a11 potential component units. The decision to include a potential component unit in the reporting entity is made by applying the criteria set forth by Governmental Accounting Standards Board ("GASB") Statement No. 14. The concept underlying the definition of the reporting entity is that elected officials are accountable. Based on these criteria, the System has not included any other entities in its reporting entity. The System is a component unit of the State of Georgia.
Although the System is a component unit of the State of Georgia's financial reporting entity, it is accountable for its own fiscal matters and presentation of its separate, combined financial statements. Boards of Trustees comprised of active and retired members and exofficio state employees are ultimately responsible for the administration of the System.

2. AUTHORIZI G LEGISLATION AND PLAN DESCRIPTIONS
Each fund, including benefit and contribution provisions, was established by state law. The fo11owing summarizes authorizing legislation and the plan description of each retirement fund:

a. ERS is a single-employer, public employee, defined benefit pension plan established by the Georgia General Assembly during the 1949 Legislative Session for the purpose of providing retirement a110wances for employees of the State of Georgia and its political subdivisions. ERS is directed by a oard of Trustees and has the powers and privileges of a corporation.

Membership - As of June 30, 2001, participation in ERS

is as follows:

Retirees and beneficiaries currently receiving benefits 25,927

Terminated employees entitled to benefits but not yet

receiving benefits

51,717

Active plan members

76647

'Ibtal

Employers

503

Benefits - The benefit structure of ERS was Significantly modified on July 1, 1982. Unless the employee elects otherwise, an employee who currently maintains membership with ERS based upon state employment that started prior to July 1, 1982 is an "old plan" member subject to the plan provisions in effect prior to July 1, 1982. All other members are "new plan" members subject to the modified plan provisions.
Under both the old and new plans, a member may retire and receive normal retirement benefits after completion of 10 years of creditable service and attain-

-28-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30. 2001 AND 2000

ment of age 65. Additiona11y, there are some provisions a110wing for retirement after 25 years of creditable service regardless of age.
Retirement benefits paid to members are based upon the monthly average of the member's highest 24 consecutive calendar months multiplied by the number of years of creditable service multiplied by the applicable benefit factor. Postretirement cost-of-living adjustments are also made to members' benefits. The normal retirement pension is payable monthly for life; however, options are available for distribution of the member's monthly pension at reduced rates to a designated beneficiary upon the member's death. Death and disability benefits are also available through ERS.
Contributions and Vesting - Member contributions under the old plan are 4% of annual compensation up to $4,200 plus 6% of annual compensation in excess of $4,200. Under the old plan, the State pays member contributions in excess of 1.25% of annual compensation. Under the old plan, these State contributions are included in the members' accounts for refund purposes and are used in the computation of the members' earnable compensation for the purpose of computing retirement benefits. Member contributions under the new plan are 1.25% of annual compensation. The State is required to contribute at a specified percentage of active member payro11 determined annually by actuarial valuation.
Members become vested after ten years of membership service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits a11 rights to retirement benefits.

The employer contributions are projected to liquidate the actuarial accrued funding excess within forty years based upon the actuarial valuation at June 30, 2000.
On November 20, 1997, the ERS Board of Trustees created the Supplemental Retirement Benefit Plan of ERS ("SRBP"). SRBP was established as a qualified governmental excess benefit plan in accordance with Section 415 of the Internal Revenue Code ("IRC 415") as a portion of ERS. The purpose of the SRBP is to provide retirement benefits to employees covered by ERS whose benefits are otherwise limited by IRC 415.
Beginning January I, 1998, a11 members and retired former members in ERS are eligible to participate in this Plan whenever their benefits under ERS exceed the limitation on benefits imposed by IRC 415.
There were 256 and 248 members eligible to participate in this portion of ERS as of June 30, 2001 and 2000, respectively. Employer contributions of $2,780,000 and $2,279,000 and retirement payments of 52,742,000 and S2,335,000 under the SRBP are included in the combined statements of changes in net assets for the years ended June 30, 2001 and 2000, respectively. Cash of 114,000 and S79,OOO and employer receivable of $205,000 and S202,000 under the SRBP are included in the combined statements of net assets for the years ended June 30, 2001 and 2000, respectively.
b. PSERS is a defined benefit pension plan established by the Georgia General Assembly in 1969 for the purpose of providing retirement a110wances for public school employees who are not eligible for membership in the Teachers Retirement System of Georgia. PSERS is administered by the ERS Board of Trustees pI us two other trustees not on the ERS Board of Trustees.

-29-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

Membership - As of JUl1e 30, 2001, participation il1 PSERS is as follows:
Retirees and beneficiaries currently receiving benefits 11,691 Terminated employees entitled to benefits but not yet receiving benefits Active plan members

'Ibta1

Employers

183

Benefits - A member may retire and elect to receive normal monthly retirement benefits after completion of ten years of creditable service and attainment of age 65. A member may choose to receive reduced benefits after age 60 and upon completion of 10 years of service.
Upon retirement, the member will receive a monthly benefit of 10 multiplied by the number of years of creditable service. Death, disability, and spousal benefits are also available through PSERS. Additionally, PSERS makes periodic cost-of-living adjustments to the monthly benefits.

COl1tributions al1d Vesting - Members contribute $4 per month for nine months each fiscal year. The State of Georgia, although not the employer of PSERS members, is required by statute to make employer contributions actuarially determined and approved and certified by the PSERS Board of Trustees.
Members become vested after ten years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.

The employer contributions are projected to liquidate the actuarial accrued funding excess within 40 years based upon the actuarial valuation at June 30, 2000.

c. LRS is a defined benefit plan established by the Georgia General Assembly in 1979 for the purpose of providing retirement allowances for all members of the Georgia General Assembly. LRS is administered by the ERS Board of Trustees.

Membership - As of June 30, 2001, participation in LRS

is as follows:

Retirees and beneficiaries currently receiving benefits

192

Terminated employees entitled to benefits but not yet

receiving benefits

97

Active plan members

'Ibtal

Employers

_ _1

Benefits - A member's normal retirement is after eight years of creditable service and attainment of age 65, or eight years of membership service (four legislative terms) and attainment of age 62. A member may retire early and elect to receive a monthly retirement benefit after completion of eight years of membership service and attainment of age 60; however, the retirement benefit is reduced by 5% for each year the member is under age 62.
Upon retirement, the member will receive a monthly service retirement allowance of $28 multiplied by the number of years of creditable service reduced by age reduction factors, if applicable. Death, disability, and spousal benefits are also available through the plan.

-30-
EMPLOYEES' RETIREME T SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

Contributions and Vesting - Member contributions are 8.5% of annual salary. The State pays member contributions in excess of 4.75% of annual compensation. Employer contributions are actuarially determined and approved and certified by the ERS Board of Trustees.
Members become vested after eight years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.
d. The GJRS is a system created to serve the members and beneficiaries of the Trial Judges and Solicitors Retirement Fund ("TJSRF"), the Superior Court Judges Retirement System ("SCJRS"), and the District Attorneys Retirement System ("DARS") (collectively the "Predecessor Retirement Systems"). As of June 30, 1998 any person who was an active, inactive, or retired member or beneficiary of the Predecessor Retirement Systems was transferred to GJRS in the same status effective July 1, 1998. All assets of the Predecessor Retirement Systems were transferred to GJRS as of July 1, 1998. GJRS is administered by the ERS Board of Trustees and three other trustees not on the ERS Board of Trustees.
GJRS is a defined benefit pension plan established by the Georgia General Assembly for the purpose of providing retirement allowances for trial judges and solicitors of certain courts in Georgia, and their survivors and other beneficiaries, superior court judges of the State of Georgia, and district attorneys of the State of Georgia.

Membership - As of June 30, 2001, participation in

GJRS is as follows:

Retirees and beneficiaries currently receiving benefits

133

Terminated employees entitled to benefits but not yet

receiving benefits

36

Active plan members

'Ibt,l.1

Employers

_ _4

Benefits - The normal retirement for GJRS is age 60 with 16 years of creditable service; however, a member may retire at age 60 with a minimum of 10 years of creditable service.
Retirement benefits paid to members are computed as 66 2/3% of annual salary plus 1% for each year of credited service over 16 years, not to exceed 24 years. Early retirement benefits paid to members are computed as the pro rata portion of the normal retirement benefit, based on service not to exceed 16 years. Death, disability, and spousal benefits are also available.

Contributions and Vestil1g - Members are required to contribute 7.5% of their annual salary plus an additional 2.5% of their annual salary if spousal benefit is elected. Employer contributions are actuarially determined and approved and certified by the GJRS Board of Trustees. Members become vested after 10 years of creditable service. Upon termination of employment, member contributions with accumulated interest are refundable upon request by the member. However, if an otherwise vested member terminates and withdraws his/her member contributions, the member forfeits all rights to retirement benefits.
The employer contributions are projected to liquidate the actuarial accrued funding excess within 12 years based upon the actuarial valuation at July 1, 2000.

-31-

EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

d. se of Estimates - The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of plan net assets and changes therein. Actual results could differ from those estimates. The System utilizes various investment instruments. Investment securities, in general, are exposed to various risks, such as interest rate, credit, and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect the amounts reported in the combined statements of plan net assets.
e. New Accounting Pronouncement - Effective July 1, 2001 the System adopted GASB Statement No. 34, Basic Financial Statements - and Management's Discussion and Analysis - for State and Local Governments. This statement modifies the external financial reporting requirements for public employee retirement systems in two ways. First, it requires that management's discussion and analysis be included as required supplementary information, and second, it provides an option to present a separate column for each defined benefit pension plan and each related postemployment health care plan the System administers in the statements of plan net assets and statements of changes in plan net assets, rather than in separate combining statements.
4. I VESTMENT PROGRAM The System maintains sufficient cash to meet its immediate liquidity needs. Cash not immediately needed is invested in either short-term or long-term investment securities as directed by management. All investments are held by agent custodial banks in the name of the System.

Cash - Cash balances are fully insured through the Federal Deposit Insurance Corporation, an agency of the U.S. Government. FidUCiary accounts, such as those of the System, are granted $100,000 of insurance coverage per participant in the System. Temporary cash on hand not committed for a specific purpose is invested overnight.
Investments - GASB Statement NO.3 requires governmental entities to categorize investments as an indication of the level of custodial credit risk assumed by the System at year-end. Category 1 includes investments that are insured or registered or for which the securities are held by the System or its agent in the System's name. Category 2 includes uninsured and'unregistered investments for which the securities are held by the counterparty's h-ust department or agent in the System's name. Category 3 includes uninsured and unregistered investments for which the securities are held by the counterparty, or by its trust department or agent but not in the System's name. All of the securities held by the System at June 30, 2001 and 2000 are of Category 1 risk level. The System is authorized by its Board of Trustees (through statutes) to invest in a variety of short-term and long-term securities, as follows:
(a) Short-Thrm: Short-term investments are authorized in the following instruments:
Repurchase and reverse repurchase agreements, whereby the System and a broker exchange cash for direct obligations of the U.S. Government or in obligations unconditionally guaranteed by the agencies of the U.S. Government or U.S. corporations. The System or broker promises to repay the cash received plus interest at a specific date in the future in exchange for the same securities. The System

-34-

EMPLOYEES' RETIREME T SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

held repurchase agreements of 5208,066,000 and $127,203,000 at June 30, 2001 and 2000, respectively. U.S. Treasury obligations with varying terms up to 360 days.
Other short-term securities authorized, but not currently used, are:
Commercial paper, with a maturity of 180 days or less. Commercial paper is an unsecured promissory note issued primarily by corporations for a specific amount and maturing on a specific day. The System considers for investment only commercial paper of the highest quality, rated P-1 and/or A-I by national credit rating agencies.
Master notes, an overnight security administered by a custodian bank and an obligation of a corporation whose commercial paper is rated P-1 and/or A-I by national credit rating agencies.
Investments in commercial paper or master notes are limited to no more than 25 million in anyone name.
(b) Long-Thrm: Fixed income investments are authorized in the fol1owi ng instruments:
Corporate bonds with at least an "N' rating by a national rating agency and limited to no more than 5% of total System assets in anyone name. Maturities of these securities vary up to a period of 40 years to provide the System with flexibility necessary to meet changing market conditions. The System held corporate bonds of $6,139,000 and $8,887,000 at June 30, 2001 and 2000, respectively.
U.S. and foreign government obligations with terms up to 30 years. Quality and call requirements of corporate bonds are applicable. The System held

U.S. government obligations of S5,806,610,000 and S5,599,525,000 at June 30, 2001 and 2000, respectively. Private placements are authorized under the same general restrictions applicable to corporate bonds. Mortgage investments are authorized to the extent that they are secured by first mortgages on improved real property located in the State of Georgia having a loan-to-value ratio no higher than 75%. Mortgages, as a group cannot exceed 10% of total assets or 1% for anyone loan.
Equity securities are also authorized (in statutes) for investment as a complement to the System's fDeed-income portfolio and as a long-term inflation hedge. By statute, no more than 60% of the total invested assets may be placed in equities and no more than 5% in anyone corporation. Equity holdings in anyone corporation may not exceed 5% of the outstanding equity of the issuing corporation. The equity portfolio is managed by the Investment Services Division (the "Division") in conjunction with independent advisors. Buy/sell decisions are based on securities meeting rating criteria established by the Board of Trustees, in-house research considering such things as yield, growth, and sales statistics, and analysis of independent market research. Equity trades are approved and executed by the Division's staff. Common stocks eligible for investment are approved by the Investment Committee of the Board of Trustees before being placed on an approved list.
Substantially all of the investments of ERS, PSERS, LRS, SCJRF, GJRS, SEAD, and certain investments of GDCP are pooled into one common investment fund. Investments of approximately $16,484,000, held by GDCp, are not included in the investment pool. Units in the pooled investment fund are allocated to the respective funds based upon the cost of assets contributed, and addi-

-35-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

e gi ef"

ti

Pia ear i J "c"al

t

e

e et" em



bi c

Emp aye s'

I
I

t y em e

E 10 e' s nc De tent Ge rgi efined

Con r"

0

la I

ear "a Ju 'c' I Re ore en

ste

G 0 gia i itary

ative etirement

ys em Public YEA R S i ement Sys em

State Employees' S E V ICE Georgia Defined

Contribution Plan Georgia ilitary Pension Fund

legislative Retirement System Public School Employees'

Retirement System State Employees' Assurance

Department Georgia Defined Contribution Plan Georgia

Judicial Retirement System Georgia Military Pension Fund

AUDITED FINANCIAL STATEMENTS
NOTES TO COMBINED FINANCIAL STATEMENTS AS OF AND FOR THE YEARS ENDED JUNE 30, 2001 AND 2000

tional units are allocated to the participating funds based on the market value of the pooled investment fund at the date of contribution. Net income of the pooled investment fund is allocated monthly to the participating funds based upon the number of units outstanding during the month.
The units of the pooled investment fund at June 30, 2001 and 2000 were allocated as follows (in thousands):

Employees' Retirement System Public School Employees Retirement System Legislative Retirement System Georgia Judicial Retirement System State Employees' Assurance Department Superior Court Judges Retirement Fund Georgia Defined Contribution Plan

2001 7118 433
16 130 459
~
8,170

2000 7,211
442 16
130 459
_ _8 8,267

5. INVESTMENTS LENDING PROGRAM State statutes and board of trustees policies permit the System to lend its securities to broker-dealers with a simultaneous agreement to return the collateral for the same securities in the future. The System is presently involved in a securities lending program with major brokerage firms. The System lends equity and fixed income securities for varying terms and receives a fee based on the loaned securities' value. During a loan, the System continues to receive dividends and interest as the owner of the loaned securities. The brokerage firms pledge collateral securities consisting of U.S. Government and agency securities, mortgage-backed securities issued by a U.S. government agency, and U.S. corporate bonds. The collateral value must be equal to at least 102% to 110% of the loaned securities' value, depending on the type of collateral security.
Securities loaned totaled $5,993,645,000 and $5,832,633,000 at fair value at June 30, 2001 and 2000,

respectively. The collateral value was equal to 104.2% and 104.1 % of the loaned securities' value at June 30, 2001 and 2000, respectively. The loaned securities are classified as Category 1 investments (see Note 4) based on the custodial arrangements for the collateral securities.
Loaned securities are included in the accompanying combined statements of net assets since the System maintains ownership. The related collateral securities are not recorded as assets on the System's combined Statements of Plan Net Assets, and a corresponding liability is not recorded, since the System is deemed not to have the ability to pledge or trade the collateral securities. In accordance with the criteria set forth in GASB Statement No. 28, the System is deemed not to have the ability to pledge or sell the collateral securities since the System's lending contracts do not address whether the lender can pledge or sell the collateral securities without a borrower default, the System has not previously demonstrated that ability, and there are no indications of the System's ability to pledge or sell the collateral securities.
6. SEAD ACTUARIAL VALUATION According to the SEAD policy terms covering the lives of members, insurance coverage is provided on a monthly, renewable term basis, and no return premiums or cash value are earned. The net assets represent the excess accumulation of investment income and premiums over benefit payments and expenses and is held as a reserve for payment of death benefits under existing policies.
The most current actuarial valuation of SEAD is as of June 30, 2000. The valuation indicated that the employee contribution rate of .50% and .25% and the employer contribution rate of .25% and .25% of members' salari s for old plan members and new plan members, respectively, as of June 30, 2000 was appropriate. Old plan members were hired prior to July 1, 1982 and new plan members were hired on or after July 1, 1982.

-36-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
R E QU IRE D SUP P L E MEN TAR Y S C H E D U L ES (I NTH 0 USA N D S )

SCHEDULE OF FUNDING PROGRESS

ACTUARIAL VALUATION
DATE

Employees' Retirement System

6/30/1996 6/30/1997 6/30/1998 6/30/1999 6/30/2000

Public School Employees' Retirement Systeml

6/30/1996 6/30/1997 6/30/1998 6/30/1999 6/30/2000

Legislative Retirement System'

6/30/1995 6/30/1997 6/30/1998 6/30/1999 6/30/2000

Georgia Judicial Retirement System

7/1/1998 7/1/1999 7/1/2000

ACTUARIAL VALUE OF
PLAN ASSETS (A)
. 6,140,080 7,432,306 8,613,575 9,848,723 10,999,901
377,490 462,639 528,770 599,464 667,642
13,137 18,197 20,375 22,679 24,666
160,171 183,249 204,136

ACTUA RIA L ACCRUED
LIABILITY ("AAV) ENTRY AGE (B)

UNFUNDED AAL/(FUNDING
EXCESS) (B-A)

FUNDING RATIO (AlB)

ANNUAL COVERED PAYROLL
(C)

UNfUNDED AAL/ (FUNDING
EXCESS) AS A PERCENTAGE OF COVERED PAYROLL
[(B-A)/ci

7,243,105 8,159,345 9,093,758 9,695,614 10,573.408

$1,103,025 727,039 480,183
(153,109) (426,493)

84.8% 91.1 % 94.7% 101.6% 104.0%

$1,968,714 1,977,928 2,055,966 2,152,072 2,304,289

56.0% 36.8% 23.4% (7.1 )% (18.5)%

401,222 465,764 504,779 586,352 615,357

23,732 3,125
(23,991) (13,112) (52,285)

94.1 % 99.3% 104.8% 102.2% 108.5%

N/A N/A N/A N/A N/A

N/A N/A N/A N/A N/A

13,860
18,086 19,272 20,129 21,628

723
(111 ) (1,103) (2,550) (3,038)

94.8%
100.6% 105.7% 112.7% 114.0%

2,186
2,340 2,363 2,411 2,411

33.1 %
(4.7)% (46.7)% (105.8)% (126.0)%

117,771 129,233 138,427

(42,400) (54,016) (65,709)

136.0% 141.8% 147.5%

26,226 29,594 34,856

(161. 7) % (182.5)% (1885)%

Information is shown only for the years available in accordance with the parameters of GASB Statement 25. Additional years will be added as data become available.
No statistics regarding covered payroll are available. Contributions are not based upon members' salaries, but are simply 4.00 per member per month for nine months each fiscal year.
Actuarial valuations were performed biennially, prior to 7/1/98.
See notes to required supplementary schedules.

-37-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
R EQU IRE 0 SUP P L EMEN TAR Y SC H E 0 U L ES (I NTH 0 USA NOS)

SCHEDULE OF EMPLOYER CONTRIBUTiONS

YEAR E OED JUNE 30,

Employees' Retirement System

1996 1997 1998 1999 2000

Public School Employees' Retirement System

1996 1997 1998 1999 2000

Legislative Retirement System

1996 1997 1998 1999 2000

Georgia Judicial Retirement System

1999 2000

STATE AN 'UAL REQUIRED CONTRIBUTION
$ 271,342 282,249 286,794 304,461 302,332
12,750 13,645 13,638 10,839
9,789
164 159 164
84 22
694 834

PERCE'TAGE CO'TRIBUTED
100% 100% 100% 100% 100%
100% 100% 107% 158% 184%
100% 100% 126% 108% 436%
100% 100%

Information is shown only for the years available in accordance with the parameters of GASB Statement Jo. 25. Additional years wi11 be added as data become available.
See notes to required supplementary schedules.

-38-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
NOT EST 0 R EQU IRE 0 SUP P L EMEN TAR Y SC H E 0 U L ES

1. Schedule of Funding Progress - The actuarial value of assets recognizes a portion of the difference between the fair value of assets and the expected actuarial value of assets, based on the assumed valuation rate of return. The amount recognized each year is 20% of the difference between fair value and expected actuarial value.

2. Schedule of Employer Contributions - The required employer contributions and percent of those contributions actua11y made are presented in the schedule.

3. Actuarial Assumptions - The information presented in the required supplementary schedules was determined as part of the actuarial valuations at the dates indicated. The July 1, 2000 actuarial valuation for GJRS included the assumption of a 12 year remaining amOliization period of the funding excess, which represents a reduction of 5 years from the previous valuation. Additional information as of the latest actuarial valuation fo11ows:

Emplouees' Retirement System Valuation date

6/30100

Actuarial cost method

Entry age

Amortization method

Level percent of pay, open

Remaining amortization period of the Funding Excess

40 years

Asset valuation method

5-year smoothed market

Actuarial assumptions: Investment rate of return' Projected salary increases'

7%
5.20-9.00%

Postretirement cost-of-living adjustment

None

Legislative Retirement Sustem Valuation date

6/30100

Actuarial cost method

Unit credit

Amortization method

Level dollar, open

Remaining amOliization period

of the Funding Excess

1A

Asset valuation method

5-year smoothed market

Actuarial assumptions:

Investment rate of return'

7%

Projected salary increases

NIA

Postretirement cost-of-living adjustment 3% annually

Georgia Judicial Retirement Sustem Valuation date

7/1/00

Actuarial cost method

Entry age

Amortization method

Level percent of pay, open

Remaining amortization period of the Funding Excess

12 years

Asset valuation method

5-year smoothed market

Actuarial assumptions: Investment rate of return' Projected salary increases'

7%
5.50%

Postretirement cost-of-Jiving adjustment

None

'Includes inflation rate of 3.50%

Public School Emplouees' Retirement Sustem

Valuation date

6/30100

Actuarial cost method

Entry age

Amortization method

Level do11ar open

Remaining amortization period of the Funding Excess

40 years

Asset valuation method

5-year smoothed market

Actuarial assumptions:

Investment rate of return'

7%

Projected salary increases

NIA

Postretirement cost-of-living adjustment 3% annua11y

-39-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

$:
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0 -<
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;0 m
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ASSETS

Employees' Retirement
System

Public School Employees' Retirement System

PENSION TRUST rUNDS

Su pCI-ior COLI rt

.Judges and

Georgia

State

District.

Legislative

Judicial Emplo)(Ocs' A ttonlcys

..ooled

Retirement Rcti,-cmcnl Assurance Retirement Investment

S) stem

System

Department

rundb

rund

Geologia Defined Contrihution
Plan

Eliminations

Total

All S\'st(~ms

2001

2000

CASH

S 868

RECEIVABLES, Employee and employer contributions Interest and dividends Unremitted insurance premiullls

35,508
--ll2Z

r'btal receivables

38,675

S 127

S 117 37

8

37

156

$29

294

294

$ 59 S93,825 93,825

SI90
1,139 131
1,270

QJ..lill (3,167)

S 1,546
.16,986 93,956
130,942

SI,332
35,950 103,1.15
139,085

INVESTMENTS - at fair vallie;

Short-term

Oblig;:ltiolls of the U.S. Governmenl and

its agencies, corporate and other bonds

Common stocks

Mortgage loans and real estatc

3,744

Equity in pool cd investmcnt fund

lUlQ.ill

'Ibwl investmcnts

.LUU..9.I.J1

rlbull asselS

12,353,459

Zi!l..l!.12 Zi!l..l!.12
748,987

.21.illi2 .21.illi2
27,823

2.2.1...!Wi .z.zu2!i
225,276

mJilll! mJilll!
793,837

208,067

~

5,812,749 8,014,283
607

~~

1,784 14,129,531

6,770 9,714

ll.ill
~ 40,423

(J41295m (J41295'11) (14,132,698)

214,837 5,822,463 8,014,283
11,351
.1.'l...!!5.2Ji
14,188,422

131,785 5,623,800 9,375,961
4,373
~ 15,276,336

LIAHILITIES
Accounts payablc and Olllcr Insurance prcmiums payable
"Tblal liabilities
NET ASSETS 11 ELD IN TRUST FOR PENSION BEN EFITS

9,834 ~ $ I 2 'l4'! (i25

416
ill
:ru..a.m.

16 ---.JQ
1.(;
Sl.Z.7.ll..

103 J..UZ

lQ;l

J..UZ

~

llilll.2.QQ

45 ~
ll.ZJl! $!~! 1795"$1

16 QJ..lill

1.6

QJ..lill

S<l.Q..<illZ $(141295'l1l

10,430

8,866

.l.Q.:QQ

aJlJi2

$14 177 992

$15267 '170

C
Z
m

Wn

00 N 3:

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C

0 0' 0

d

Z >....-,

~Z

rr1

-l [)
:r V'l

d ...,.,

Z

n

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-l
:r
0
c

0 3:
-0
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-l
m
3:
m

V'l ;0 Z

>- >- -l

>-
Z
>
Z
-n
;>
t-

Z -l V'l

0
V'l

<
m

0..,.,

V....',l
.>...,

-l Z 0m
-l -l

m ~

>-
r-

>-

V'l V'l

m
.Z...,

..,.,

V'l
m

V'l

0 -l
?:l V'l

N 0 0 0

AUDITED FINANCIAL STATEMENTS
SUPERIOR COURT JUDGES AND DISTRICT ATTORNEYS RETIREMENT FUNDS
COMBINING STATEMENTS OF NET ASSETS JUNE 30, 2001 WITH COMPARATIVE TOTALS FOR 2000
(IN THOUSANDS)

ASSETS CASH RECEIVABLES:
Employee and employer contributions Total receivables
INVESTMENTS - at fair value: Equity in pooled investment fund Total assets
LIABILITIES ACCOUNTS PAYABLE AND OTHER
Total liabilities NET ASSETS HELD IN TRUST FOR PENSION BENEFITS

PENSION TRUST FUNDS

Superior Court

District

Judges

Attorneys

Retirement

Retirement

Fund

Fund

$ 56

$3

TOTAL

2001

2000

$ 59

$ 102

_ _1

----CD.

1

(1)

_ _1 1

1,725 1,782

1,725

1,835

2

1,784

1,938

----.1,1 43
$1,739

_ _2 _ _2
L..:-

~ ~
$1.739

----.1.2 ----.1.2
$1.896

(A schedule of fimding progress is presented on page 37)

-41-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

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Employees' Retirement
System

l'ubJic School Employees' Retirement. System

PENSION TRUST FUNDS

Su pel"jar COLI rt

Judges and

Georgia

St.ale

District

Legislative

Judicial Employees' j\ ttorncys

Pooled

Retirement Retirement Assurance Retirement Investment

System

System

I)cpartl11(:nt

runds

rund

Georgia Defined Contribution
Plan

Eliminations

Total

All Systems

2001

2000

NET ASSETS I-IELD IN TRUST FOR PENSION BE 'EFITS - Beginning of year

S 13,301,163

ADDITIONS, Contributions: Employer Employee Insurance premiullls Administrative expense allOll11ent Investment (loss) income: Net (depreciation) appreciation in fair value of investments Inlcrcst and dividends Less investmenl expenses Allocation of inveSlment earnings

315,505 55,887
86 (546) (795 223)

Nel investment (loss) incomc

(95683)

Thtal additions

(l124291)

813,296
17,030 1,227 625
~ ~ ~

DEDUCTIONS, Retircmcnt payments Rcfunds of cmployec contributions and interest Death benefits /\dministrative expenses
Total deductions
Tit \ '1SrERS 1U Sl'STE\!S rltO\!
r POOLED I~VJ:ST"'t:i\T ~J)
NET (DECREASE) INCREASE
NET ASSETS IIELD IN TRUST FOR PENSION BENEFITS - End of Ycar

518,734

33,464

7,563

282

6950 533 247

~
--..:H.:ill

(957538)

~

$12 "J4'~ 625

~

$ 29,525

$ 239,64'1

S 846,072

1,896

S 15,215,115

$ 35,874

S (15,215,115)

S 15,267,470 S 14,422,057

97

1,269

2,087

250

3,347

12

13,813

110

175

30

11,725

16

--CQlli..) -----iillil.l ~

~ ~
-'l!.QW

~ ~
-UZ..UQ.L

-.illU -illD --UJ.l!

(1,379,336) 478,438 (10,739)
(911637) (911 637)

336 1,088
(I)
--U...Zlli
-----lJ!2
---.lLllilZ

911 637 911 637 911637

335,988 72,448 13,813 940
(1,379,000) 479,631 (11,286)

323,325 70,474 17,413 737
494,234 487,727 (12,044)

ffi.!.Q..!ml (487466)

I 381 866

1,079 35
---llll ---.Llli

5,150 5'1
----l.Z,> ~

18,017 ----.Z.Z,2
---lll.lli

2,145
---.:lQ ~

7,064 -----:l.I.Q
--LJ:Z1.

560,572
14,998 18,017 81125
602012

496,830
15,474 15,921 8 228
536453

---lL1'lID

----U..1..ill)

---C5,UZ2l

-LLm

C! 73 947) (l 085584)

~

mJ!:!Z
I 085584

C! 089478)

845413

$..J,Llll

$ 225 IT~

~

:I

.'14 1295: 1

404

$.( 14 12<).531)

$14 177992 $15 767470

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m

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0

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V'l

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tv 0 0 0

AUDITED FINANCIAL STATEMENTS
SUPERIOR COURT JUDGES AND DISTRICT ATTORNEYS RETIREMENT fUNDS
COMBINING STATEMENTS OF CHANGES IN NET ASSETS JUNE 30, 2001 WITH COMPARATIVE TOTALS FOR 2000 (IN THOUSANDS)

NET ASSETS HELD IN TRUST FOR PENSION BENEFITS - Beginning of year
ADDITIONS: Contributions: Employer Employee Administrative expense allotment Investment (loss) income: Interest and dividends Less investment expenses Allocation of investment earnings Net investment (loss) income Total additions
DEDUCTIONS: Retirement payments Administrative expenses
Total deductions

PE SIaN TRUST FUNDS

Superior Court

District

Judges

Attorneys

Retirement

Retirement

Fund

Fund

TOTAL

2001

2000

$1,896

$1,896

$ 1,760

1,946 12 30
---illD ---illD
1,877
2,004
~
2,034

$141

2,087 12 30

2,026 11

2

(1)

---illD

~

---illD

~

141

2,018

2,302

141

2,145

2,166

-----.JQ

- --

141

2.175

2,166

NET INCREASE (DECREASE)
NET ASSETS HELD IN TRUST FOR PENSION BENEFITS - End of year

$1.739

$1.739

$1.896

-43-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

AUDITED FINANCIAL STATEMENTS
ADMINISTRATIVE EXPENSE FUND
CONTRIBUTIONS AND EXPENSES YEAR ENDED JUNE 30, 2001 AND 2000
(IN THOUSANDS)

Contributions: Employees' Retirement System Public School Employees' Retirement System Legislative Retirement System Georgia Judicial Retirement System State Employees' Assurance Department Georgia Defined Contribution Plan Superior Court Judges Retirement Fund
Total contributions
Expenses: Personal services: Salaries and wages Retirement contributions FICA Health insurance Miscellaneous
Communications: I'ostage Publications and printing Telecom mu nications Travel
Professional services: Accounting and investment services
Computer services onsulti ng services
Actuarial services Medical services Professiona I fees Legal services
Rentals: Office space Office equipment
Other services and charges: Equipment Temporary services Supplies and materials Repairs and maintenance Courier services Board member expenses Miscellaneous
Total expenses
Net 1ncome
Balance: Beginning of year
End of year

2001
$6,950 625
no
175 225 310 ---1.Q
8425
1,805 310 125 236
--.1} 25] 9
101 40 78 _ _1_7 -.1}Q
1,474 ] ,879
826 ]55 ]92
61
------.3.Z
4624
341
--]
-ill
4 218
29 441
5 5 _ _2 --ZQ.1
8425

-44-
EMPLOYEES' RETIREMENT SYSTEM OF GEORGIA

2000
$7,099 575 68 94 147 245
--
8228
1,952 292 138 257
--.1} 2682
130 35 79
-----.Mt ---.1ZJ
1,340 2,878
]27 ] 41 47
--H
4557
339 _ _1
340
12 62 22 260
5 5 _ _1_0 -----..3.ZQ
8228

EMPLOYEES' RETIREMENT SYSTEM
OF GEORGLA
1\\10 Northside Seventy-Five I Suite 300 I Atlanta, Georgia 30318-7778 404-352-6400 I 1-800-805-4609 I Fax 404-352-6431