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PERAC Memo #9 - 1998: Year-End 1997 Pooled Fund Investment Reporting Requirements

Year-End 1997 Pooled Fund Investment Reporting Requirements

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Summary

PERAC Memo #9/1998 reminds boards that all investments—whether separately managed or pooled (mutual funds, commingled funds, group trusts, real estate/venture capital funds, etc.)—must comply with G.L. c. 32 and 840 CMR. Boards must submit, or ensure their pooled fund managers submit, a year-end (12/31/97) report for each pooled fund investment detailing underlying assets, portfolio turnover rate, expense ratio, and rate of return (specifying net or gross); a fund's standard annual report typically satisfies this requirement. Boards should also retain a copy of this data to verify manager compliance with regulations, the vendor contract, and the board's Statement of Investment Objectives (Form 18-1).

Full Text

PERAC MEMO #9/1998 M E M O R A N D U M TO:All Retirement Boards FROM:Joseph I. Martin, Deputy Executive Director DATE:February 10, 1998 Please be advised that all investments of the board, separately managed or in a pooled fund, must comply with G.L. c. 32 and PERAC Regulations (840 CMR). Pooled funds are investment vehicles such as mutual funds, commingled funds, group trusts, real estate funds, limited partnership funds, and venture capital funds. In this regard, each board must submit or request that pooled fund managers (if any) submit to PERAC a year-end report (12-31-97) for each of the board’s pooled fund investments that provides the following information:

  1. A detailed listing of all the underlying assets in the portfolio including cash and short-term investments as of 12-31-97.
  2. Portfolio turnover rate for the period 1-1-97 through 12-31-97.
  3. Ratio of portfolio expenses to assets for the period 1-1-97 through 12-31-97.
  4. Portfolio rate of return for the period 1-1-97 to 12-31-97 (indicate whether return(s) provided is net or gross). Please be advised that this requested information is generally included in the annual report of a pooled fund and the submission of this report to PERAC should satisfy the requirements of this request. It is acceptable to submit the report that includes twelve (12) months of fund data for the period closest to 12-31-97 if the fund’s year-end is not 12-31-97 and the annual report is not available for this period. The board should also obtain a copy of this information to confirm that the manager is investing pursuant to the regulations, G.L. c. 32, the vendor’s contract, and the Statement of Investment Objectives (Form 18-1). Thank you in advance for your cooperation in this matter. If you have any questions, please call Vicky Marcorelle, at 727-9380 ext. 643.