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Minnesota Legislature

Office of the Revisor of Statutes

Chapter 356

Section 356.20

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356.20 PUBLIC PENSION FUND FINANCIAL REPORTING REQUIREMENT.
    Subdivision 1. Report required. (a) The governing or managing board or administrative
officials of the public pension and retirement funds enumerated in subdivision 2 shall annually
prepare and file a financial report following the close of each fiscal year.
(b) This requirement also applies to any plan or fund which may be a successor to any
organization so enumerated or to any newly formed retirement plan, fund or association operating
under the control or supervision of any public employee group, governmental unit, or institution
receiving a portion of its support through legislative appropriations.
(c) The report must be prepared under the supervision and at the direction of the management
of each fund and must be signed by the presiding officer of the managing board of the fund and
the chief administrative official of the fund.
    Subd. 2. Covered public pension plans and funds. This section applies to the following
public pension plans:
(1) the general state employees retirement plan of the Minnesota State Retirement System;
(2) the general employees retirement plan of the Public Employees Retirement Association;
(3) the Teachers Retirement Association;
(4) the State Patrol retirement plan;
(5) the St. Paul Teachers Retirement Fund Association;
(6) the Duluth Teachers Retirement Fund Association;
(7) the Minneapolis Employees Retirement Fund;
(8) the University of Minnesota faculty retirement plan;
(9) the University of Minnesota faculty supplemental retirement plan;
(10) the judges retirement fund;
(11) a police or firefighter's relief association specified or described in section 69.77,
subdivision 1a
, or 69.771, subdivision 1;
(12) the public employees police and fire plan of the Public Employees Retirement
Association;
(13) the correctional state employees retirement plan of the Minnesota State Retirement
System; and
(14) the local government correctional service retirement plan of the Public Employees
Retirement Association.
    Subd. 3. Filing requirement. The financial report is a public record. A copy of the report or
a synopsis of the report containing the information required by this section must be distributed
annually to each member of the fund and to the governing body of each governmental subdivision
of the state which makes employers contributions thereto or in whose behalf taxes are levied for
the employers' contribution. A signed copy of the report must be delivered to the executive
director of the Legislative Commission on Pensions and Retirement and to the Legislative
Reference Library not later than six months after the close of each fiscal year or one month
following the completion and delivery to the retirement fund of the actuarial valuation report of
the fund by the actuary retained under section 356.214, if applicable, whichever is later.
    Subd. 4. Contents of financial report. (a) The financial report required by this section must
contain financial statements and disclosures that indicate the financial operations and position of
the retirement plan and fund. The report must conform with generally accepted governmental
accounting principles, applied on a consistent basis. The report must be audited. The report must
include, as part of its exhibits or its footnotes, an actuarial disclosure item based on the actuarial
valuation calculations prepared by the actuary retained under section 356.214 or by the actuary
retained by the retirement fund or plan, whichever applies, according to applicable actuarial
requirements enumerated in section 356.215, and specified in the most recent standards for
actuarial work adopted by the Legislative Commission on Pensions and Retirement. The accrued
assets, the accrued liabilities, including accrued reserves, and the unfunded actuarial accrued
liability of the fund or plan must be disclosed. The disclosure item must contain a declaration by
the actuary retained under section 356.214 or the actuary retained by the fund or plan, whichever
applies, specifying that the required reserves for any retirement, disability, or survivor benefits
provided under a benefit formula are computed in accordance with the entry age actuarial cost
method and in accordance with the most recent applicable standards for actuarial work adopted
by the Legislative Commission on Pensions and Retirement.
(b) Assets of the fund or plan contained in the disclosure item must include the following
statement of the actuarial value of current assets as defined in section 356.215, subdivision 1:


Value at
cost
Value at
market

Cash, cash equivalents, and

short-term securities





Accounts receivable





Accrued investment income





Fixed income investments





Equity investments other

than real estate





Real estate investments





Equipment





Participation in the Minnesota

postretirement investment

fund or the retirement

benefit fund





Other





Total assets

Value at cost



Value at market




Actuarial value of current
assets


(c) The unfunded actuarial accrued liability of the fund or plan contained in the disclosure
item must include the following measures of unfunded actuarial accrued liability, using the
actuarial value of current assets:
(1) the unfunded actuarial accrued liability, determined by subtracting the current assets
and the present value of future normal costs from the total current and expected future benefit
obligations; and
(2) the unfunded pension benefit obligation, determined by subtracting the current assets
from the actuarial present value of credited projected benefits.
If the current assets of the fund or plan exceed the actuarial accrued liabilities, the excess
must be disclosed and indicated as a surplus.
(d) The pension benefit obligations schedule included in the disclosure must contain the
following information on the benefit obligations:
(1) the pension benefit obligation, determined as the actuarial present value of credited
projected benefits on account of service rendered to date, separately identified as follows:

(i)
for annuitants,

retirement annuities,

disability benefits,

surviving spouse and child benefits;

(ii)
for former members without vested rights;


(iii)
for deferred annuitants' benefits, including
any augmentation;

(iv)
for active employees,


accumulated employee contributions,
including allocated investment income,

employer-financed benefits vested,

employer-financed benefits nonvested,

total pension benefit obligation; and
(2) if there are additional benefits not appropriately covered by the foregoing items of benefit
obligations, a separate identification of the obligation.
(e) The report must contain an itemized exhibit describing the administrative expenses of the
plan, including, but not limited to, the following items, classified on a consistent basis from year
to year, and with any further meaningful detail:
(1) personnel expenses;
(2) communication-related expenses;
(3) office building and maintenance expenses;
(4) professional services fees; and
(5) other expenses.
(f) The report must contain an itemized exhibit describing the investment expenses of the
plan, including, but not limited to, the following items, classified on a consistent basis from year
to year, and with any further meaningful detail:
(1) internal investment-related expenses; and
(2) external investment-related expenses.
(g) Any additional statements or exhibits or more detailed or subdivided itemization of a
disclosure item that will enable the management of the fund to portray a true interpretation of the
fund's financial condition must be included in the additional statements or exhibits.
    Subd. 4a. Financial report for police or firefighters relief association. For any police or
firefighter's relief association referred to in subdivision 2, clause (12), a financial report duly filed
and meeting the requirements of section 69.051 must be deemed to have met the requirements of
subdivision 4.
    Subd. 5.[Repealed, 1984 c 383 s 5]
History: 1965 c 359 s 1; 1969 c 249 s 1; 1971 c 7 s 1-3; 1971 c 197 s 4; 1971 c 281 s 1,2;
1975 c 192 s 1,2; 1978 c 563 s 6-8; 1979 c 50 s 49; 1981 c 37 s 2; 1981 c 224 s 168; 1981 c 298 s
11; 1984 c 564 s 42; 1Sp1985 c 7 s 26; 1986 c 359 s 26; 1987 c 259 s 52-54; 1987 c 372 art 1 s
19; 1991 c 269 art 3 s 2; 1995 c 141 art 3 s 20; 1997 c 233 art 1 s 56; 1999 c 222 art 2 s 16; 2002
c 392 art 11 s 2-6; 1Sp2005 c 8 art 3 s 6; 2006 c 271 art 3 s 47; 2006 c 277 art 3 s 31