Local WRS Employers
Vol. 19, Local D
May 3, 2002
Bulletin Provides 2002 Financial
Disclosure Footnote To Help Employers Complete Annual Financial
Statements and Reports
The Department of Employee Trust Funds (ETF) annually provides
Wisconsin Retirement System (WRS) employers with model language
to use for required WRS footnotes in annual financial statements
The footnote shows where to insert information specific to each
employer. We also enclose a data sheet for each employer, containing
the specific information you should insert into the footnote. The
only information you will need to develop using your own records
is total employer payroll, including non-participating employees.
The unfunded actuarial accrued liability balance is as of December
31, 2001. We have included 2002 prior service contribution rates
if you wish to calculate prior service contributions made during
2002 in order to update this liability.
The footnotes are intended as a model for use by all WRS
employers. You or your auditors may wish to modify the language
for your own purposes.
If you have questions, please contact Nancy Kittleson of the
ETF Office of the Controller at (608) 267-9034.
Model Footnote - Defined Benefit Pension Plan
All eligible (insert employer name) employees
participate in the Wisconsin Retirement System (WRS), a cost-sharing
multiple-employer defined benefit public employee retirement system
(PERS). All permanent employees expected to work over 600 hours
a year (440 hours for teachers) are eligible to participate in the
WRS. Covered employees in the General/Teacher/Educational Support
Personnel category are required by statute to contribute 5.2% of
their salary (3.9% for Executives and Elected Officials, 3.8% for
Protective Occupations with Social Security, and 3.3% for Protective
Occupations without Social Security) to the plan. Employers may
make these contributions to the plan on behalf of employees. Employers
are required to contribute an actuarially determined amount necessary
to fund the remaining projected cost of future benefits.
The payroll for (insert employer name)
employees covered by the WRS for the year ended December 31, 2001
was (insert employer covered earnings);
the employer's total payroll was (insert total
employer payroll). The total required contribution
for the year ended
December 31, 2001 was (insert total contribution),
which consisted of (insert employer required contribution),
or (insert employer percent of covered payroll)
of payroll from the employer and (insert employee required
contribution), or (insert employee percent
of payroll) of payroll from employees. Total contributions
for the years ending December 31, 2000 and 1999 were
(insert 2000 total contributions)
and (insert 1999 total contributions),
respectively, equal to the required contributions for each year.
Employees who retire at or after age 65 (62 for elected officials
and 55 for protective occupation employees) are entitled to receive
a retirement benefit. Employees may retire at age 55 (50 for protective
occupation employees) and receive actuarially reduced benefits.
The factors influencing the benefit are: (1) final average earnings,
(2) years of creditable service, and (3) a formula factor. Final
average earnings is the average of the employee's three highest
years earnings. Employees terminating covered employment before
becoming eligible for a retirement benefit may withdraw their contributions
and, by doing so, forfeit all rights to any subsequent benefit.
For employees beginning participation on or after January 1, 1990
and no longer actively employed on or after April 24, 1998, creditable
service in each of five years is required for eligibility for a
retirement annuity. Participants employed prior to 1990 and on or
after April 24, 1998 are immediately vested.
The WRS also provides death and disability benefits for employees.
Eligibility and the amount of all benefits are determined under
Chapter 40 of Wisconsin Statutes. The WRS issues an annual financial
report that may be obtained by writing to the Department of Employee
Trust Funds, P.O. Box 7931, Madison, WI 53707-7931.