REPORT DIGEST

STATE EMPLOYEES’ RETIREMENT SYSTEM OF
ILLINOIS

COMPLIANCE EXAMINATION OF CENSUS DATA
FOR THE TWO YEARS ENDED JUNE 30, 2021

Release Date:  Aug. 30, 2022

FINDINGS THIS AUDIT:  1

CATEGORY:  NEW -- REPEAT – TOTAL
Category 1:  0 -- 0 -- 0
Category 2:  1 -- 0 -- 1
Category 3:  0 -- 0 -- 0
TOTAL:  1 -- 0 -- 1

FINDINGS LAST AUDIT: 0*

* This is the first Compliance
Examination of Census Data of the
Department of Central Management
Services and the Department of
Transportation.

Category 1: Findings that are material
weaknesses in internal control and/or
a qualification on compliance with
State laws and regulations (material
noncompliance).
Category 2: Findings that are
significant deficiencies in internal
control and noncompliance with State
laws and regulations.
Category 3: Findings that have no
internal control issues but are in
noncompliance with State laws and
regulations.

State of Illinois, Office of the
Auditor General
FRANK J. MAUTINO, AUDITOR GENERAL

To obtain a copy of the Report
contact:
Office of the Auditor General, Iles
Park Plaza, 740 E. Ash Street,
Springfield, IL 62703
(217) 782-6046 or TTY (888) 261-2887

This Report Digest and Full Report are
also available on the worldwide web at
www.auditor.illinois.gov

INTRODUCTION

Certain financial statement elements
within an employer’s financial
statements which are attributable to
pensions are dependent on the census
data of its employees.  Census data is
demographic data (date of birth,
gender, years of service, etc.) of the
active, inactive, or retired members
of a pension plan.  The purpose of a
compliance examination of census data
is to provide assurance to employers
and their auditors that employers have
enrolled employees in the plan in
accordance with applicable laws,
rules, and regulations, changes in
significant elements of census data
for employees were reported to the
plan, and employer contributions
remitted to the plan were complete,
accurate, and in accordance with
applicable laws, rules, and
regulations.

SYNOPSIS

• (21-01) The Department of Central
Management Services did not ensure
accurate census data was used in the
actuarial valuations.

FINDINGS, CONCLUSIONS, AND
RECOMMENDATIONS

INACCURATE CENSUS DATA

The Department of Central Management
Services Department) did not ensure
accurate census data was used in the
actuarial valuations.

Census data is demographic data (date
of birth, gender, years of service,
etc.) of the active, inactive, or
retired members of a pension or other
postemployment benefit (OPEB) plan.
The accumulation of inactive or
retired members' census data occurs
before the current accumulation period
of census data used in the plan's
actuarial valuations (which eventually
flows into each employers financial
statements), meaning the plan is
solely responsible for establishing
internal controls over these records
and transmitting this data to the
plan's actuary. In contrast,
responsibility for active members'
census data during the current
accumulation period is split among the
plan and each member's current
employer(s). Initially, employers must
accurately transmit census data
elements of their employees to the
plan. Then, the plan must record and
retain these records for active
employees and then transmit this
census data to the plan's actuary.

We noted the Department’s employees
are members of both the State
Employees’ Retirement System of
Illinois (SERS) for their pensions and
the State Employees Group Insurance
Program sponsored by the Department
for their OPEB. In addition, we noted
these plans have characteristics of
different types of pension and OPEB
plans, including single employer plans
and cost-sharing multiple-employer
plans.

During backwards testing, we noted one
of 40 (3%) employee had a retirement
code that differed between Department
and SERS records, which resulted in
inaccurate data being used in the
pension and OPEB actuarial valuations.
The independent actuary used for the
pension and OPEB plans deemed the
error immaterial to the valuations.
(Finding 1, pages 9-10)

We recommended the Department
implement controls to ensure accurate
data is used in the actuarial
valuation. If differences are noted
between the Department’s data and SERS
these differences should be
communicated timely to ensure the
actuarial valuations are using
accurate data.

Department officials accepted our
recommendation and stated the Bureau
of Personnel (BoP) has completed the
initial reconciliation of census data.
BoP has contacted SERS in preparation
for the annual reconciliation for
current year 2022. BoP anticipates
having the annual reconciliation
completed on-time in accordance with
the statute.

ACCOUNTANT’S OPINION

The accountants conducted a compliance
examination of census data for the
Department of Central Management
Services and the Department of
Transportation for the year ended June
30, 2021.  The accountants stated the
Department of Central Management
Services and the Department of
Transportation complied, in all
material respects, with the
requirements described in the report.

This compliance examination of census
data was conducted by Sikich LLP.

JANE CLARK
Division Director

This report is transmitted in
accordance with Section 3-14 of the
Illinois State Auditing Act.

FRANK J. MAUTINO
Auditor General

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