REPORT DIGEST

TEACHERS’ RETIREMENT SYSTEM OF THE STATE OF ILLINOIS

COMPLIANCE EXAMINATION

For the Year Ended:

June 30, 2008

Summary of Findings:

Total this Report 0

Total last Report 0

Repeated from last Report 0

Release Date:

April 23, 2009

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

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 the Full Report

are also available on

the worldwide web at

www.auditor.illinois.gov

INTRODUCTION

This digest covers our compliance attestation examination of the Teachers’ Retirement System (System) for the year ended June 30, 2008. A financial audit covering the year ending June 30, 2008 was previously released on January 15, 2009. There were no report findings of noncompliance identified during our testing.

ACCOUNTANTS’ REPORT

We conducted a compliance attestation examination of the System for the year ended June 30, 2008 as required by the Illinois State Auditing Act. The accountants’ report does not contain any scope limitations, disclaimers or other significant non-standard language.

_____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:RPU:pp

SPECIAL ASSISTANT AUDITORS

BKD LLP were our special assistant auditors for this engagement.

{Financial Data and Supplementary Information are summarized on the reverse page.}

TEACHERS' RETIREMENT SYSTEM OF ILLINOIS

COMPLIANCE EXAMINATION

YEAR ENDED JUNE 30, 2008

OPERATING STATEMENT ANALYSIS	FY 2008	FY 2007
REVENUES: Contributions - Members................................................................ Contributions - State of Illinois................................................... Contributions - School Districts.................................................. Total Contributions.................................................................... Investment Income - Appreciation (Depreciation) in Fair Value Investment Income - Income From Investments....................... Total Investment Income (Loss)................................................ Investment Expense...................................................................... Total Revenue ............................................................................ EXPENSES: Benefits.............................................................................................. Refunds............................................................................................ Administrative Expenses............................................................... Total Expenses............................................................................. Excess Revenue over (Under) Expenses....................................	$ 865,400,168 1,041,114,825 130,673,629 $ 2,037,188,622 $(3,235,738,717) 1,409,751,363 $(1,825,987,354) 188,915,012 $ 22,286,256 $ 3,423,981,732 60,285,624 16,613,364 $ 3,500,880,720 $(3,478,594,464)	$ 826,249,007 737,670,628 115,915,040 $1,679,834,675 $5,597,334,135 1,384,916,220 $6,982,250,355 150,925,919 $8,511,159,111 $3,111,752,675 59,731,909 15,246,203 $3,186,730,787 $5,324,428,324
SCHEDULE OF INVESTMENT PORTFOLIO - Fair Value	JUNE 30, 2008	JUNE 30, 2007
Equities: Common Stocks, U.S. Equities.................................................... Common Stocks, Non - U.S. Equities ....................................... Preferred Stocks, U.S. Equities ................................................. Preferred Stocks, Non - U.S. Equities....................................... Total Equities....................................................................... Fixed Income: U.S. Government, U.S. Treasuries.............................................. U.S. Government, Federal Agencies......................................... U.S. Government, Municipals (taxable).................................... U.S. Government, Index Linked Bonds..................................... U.S. Government, Backed Mortgages...................................... U.S. Corporate: Asset Backed Securities................................. U.S. Corporate: Commercial Mortgage Backed Securities..... U.S. Corporate: Collateralized Mortgage Obligations............ U.S. Corporate: Commingled / Closed End Funds.................. U.S. Corporate: Convertible Bonds........................................... U.S. Corporate: Credit Obligations............................................ International Notes and Bonds................................................. Total Fixed Income.............................................................. Total Real Return – Commingled Funds.............................................................. Short Term Investments......................................................................................... Derivatives: Options, Futures and Swaps........................................................... Real Estate................................................................................................................ Private Equity.......................................................................................................... Absolute Return...................................................................................................... Foreign Currency.................................................................................................... TOTAL INVESTMENTS...................................................................................	$10,833,227,881 8,183,568,806 30,706,395 296,230,161 $19,343,733,243 710,206,700 492,181,750 28,296,195 296,216,084 2,374,253,476 370,453,273 361,639,452 755,133,505 81,924,023 6,493,000 2,173,436,388 1,319,829,277 $ 8,970,063,123 2,118,735,890 1,330,031,596 (25,678,522) 4,794,916,293 2,399,224,145 504,224,094 60,605,839 $39,495,855,701	$13,908,176,627 9,360,153,385 33,817,240 185,832,865 $23,487,980,117 513,731,037 1,217,042,065 301,251 449,648,751 3,192,471,823 536,240,991 493,727,355 848,151,787 39,010,178 4,492,094 1,945,687,488 900,493,848 $10,140,998,668 0 1,474,343,766 847,479 4,693,519,131 1,894,311,762 490,000,000 49,081,933 $42,231,082,856
iNVESTMENTS USED FOR Benefits and Expenses	FY 2008	FY 2007
CONTRIBUTIONS: Member/Employers/State of Illinois (1).......................... ............................................................................................ DEDUCTIONS: Benefits................................................................................ Refunds................................................................................ Administration.................................................................... Total Deductions (2).................................................. Investments used to Pay Benefits and Expenses (1)-(2).....................................	$ 2,037,188,622 $ 3,423,981,732 60,285,624 16,613,364 $ 3,500,880,720 $(1,463,692,098)	$ 1,679,834,675 $ 3,111,752,675 59,731,909 15,246,203 $ 3,186,730,787 $(1,506,896,112)
SUPPLEMENTARY INFORMATION	FY 2008	FY 2007
Total time weighted return on investments (unaudited)................................... New Age Retirement Claims Processed (unaudited)......................................... Number of Retirement Annuitants....................................................................... Average Monthly Benefit for Retirement Annuitants...................................... Number of Survivor Annuitants........................................................................... Average Monthly Benefit for Survivor Annuitants.......................................... Value of General Obligation Bond, Pension Series 2003 investments............	(5.0)% 4,492 81,773 $3,461 8,647 $1,266 $5,502,916,284	19.2% 5,509 79,728 $3,344 8,447 $1,196 $6,150,127,638
EXECUTIVE DIRECTOR
During Engagement Period: Jon Bauman Currently: Stan Rupnik, Acting Executive Director

REPORT DIGEST

SPECIAL ASSISTANT AUDITORS

YEAR ENDED JUNE 30, 2008

iNVESTMENTS USED FOR Benefits and Expenses

SUPPLEMENTARY INFORMATION

FY 2008

FY 2007