Illinois Teachers' Retirement System 2002 Audit

REPORT DIGEST
TEACHERS’ RETIREMENT SYSTEM

COMPLIANCE AUDIT

For the Year Ended:

June 30, 2002

Summary of Findings:

Total this audit 0
Total last audit 2
Repeated from last audit 0

Release Date:
March 13, 2003

State of Illinois

Office of the Auditor General

WILLIAM G. HOLLAND

AUDITOR GENERAL

Iles Park Plaza
740 E. Ash Street
Springfield, IL 62703
(217) 782-6046
To obtain a copy of the Report contact:
Office of the Auditor General
Attn: Records Manager
Iles Park Plaza
740 E. Ash Street
Springfield, IL 62703

(217)782-6046 or TDD (217) 524-4646
This Report Digest is also available on
the worldwide web at
http://www.state.il.us/auditor

INTRODUCTION

This digest covers our compliance audit of the System for the year ended June 30, 2002. A financial audit covering the year ending June 30, 2002 was issued separately.

There were no material findings of noncompliance disclosed during our audit tests. We commend the System for maintaining effective internal controls.

_____________________________________

WILLIAM G. HOLLAND, Auditor General

WGH:RPU:pp

SPECIAL ASSISTANT AUDITORS

McGladrey & Pullen LLP were our special assistant auditors for this audit.

{Financial Data and Activity Measures are summarized on the reverse page.}

TEACHERS' RETIREMENT SYSTEM OF ILLINOIS
INFORMATION FROM FINANCIAL AND COMPLIANCE AUDITS
YEAR ENDED JUNE 30, 2002

OPERATING STATEMENT ANALYSIS	FY 2002	FY 2001
Revenues: Contributions - Members Contributions - State of Illinois Contributions - School Districts Total Contributions Investment Income - Appreciation in Fair Value Investment Income - Income From Investments Total Investment Income (Loss) Investment Expense Total Revenues Expenses: Total Benefits Other Expenses Total Expenses Deficiency of Revenue over Expenses	$ 681,151,770 814,739,766 92,618,146 $ 1,588,509,682 (1,461,163,444) 868,721,601 (592,441,843) (131,545,202) $ 864,522,637 $ 1,759,748,668 54,135,340 $ 1,813,884,008 $ (949,361,371)	$ 643,563,304 724,007,792 97,617,613 $ 1,465,188,709 (1,860,498,992) 1,061,629,965 (798,869,027) (216,386,210) $ 449,933,472 $ 1,566,793,231 48,906,765 $ 1,615,699,996 $(1,165,766,524)
INVESTMENT PORTFOLIO ANALYSIS - Fair Value	JUNE 30, 2002	JUNE 30, 2001
Total Government Obligations Total Corporate Obligations International Notes Preferred Stock (U.S. & International Combined) Common Stock - U.S. Common Stock - International Short Term Investments Real Estate Investments Private Equity Foreign Currency Total Investment Portfolio	$ 4,202,383,716 2,572,684,208 2,020,171,317 100,963,556 6,732,052,482 3,293,632,161 1,435,410,212 2,202,925,998 594,153,359 23,955,458 $23,178,332,467	$ 3,895,484,138 3,125,058,898 1,797,319,661 112,594,835 6,301,664,623 4,601,292,055 1,238,861,490 2,424,554,513 689,740,876 26,752,464 $24,213,323,553
ADMINISTRATIVE EXPENSES	FY 2002	FY 2001
Personal Services Professional Services Postage Machine Repair and Rental Other Contractual Services Commodities Occupancy Expense Provision for Depreciation Loss on Disposal of Equipment Total Administrative Expenses	$ 9,328,695 1,434,574 390,748 473,750 657,504 396,268 174,040 631,520 294 $13,487,393	$ 9,195,997 844,265 414,273 409,675 769,075 270,924 168,563 561,158 6,665 $12,640,595
SELECTED ACCOUNT BALANCES	JUNE 30, 2002	JUNE 30, 2001
Cash Receivables Accrued Investment Income Receivable Investments Collateral from Securities Lending Prepaid Expenses Property and Equipment Total Assets Total Liabilities Net Assets Held in Trust for Pension Benefits Actuarial Accrued Liability Unfunded Actuarial Accrued Liability	$ 6,039,088 159,375,923 233,414,394 22,944,918,073 1,897,635,461 410,160 3,113,533 $ 25,244,906,632 2,878,621,920 $ 22,366,284,712 43,047,674,000 $(20,681,389,288)	$ 7,889,353 198,872,583 202,756,810 24,010,566,743 2,288,995,477 968,066 3,658,427 $ 26,713,707,459 3,398,061,376 $ 23,315,646,083 39,166,697,000 $(15,851,050,917)
SUPPLEMENTARY INFORMATION	FY 2002	FY 2001
Total investment manager fees Total time weighted return on investments Average Number of System Employees Number of Retirement Annuitants Total Brokerage Commissions Paid	$65,274,190 (3.2)% 167 59,360 $13,659,145	$67,109,156 (4.2)% 171 56,549 $13,690,437
EXECUTIVE DIRECTOR(S)
During Audit Period : Kimberly Pollitt, Acting , April 1, 2001 to August 8, 2001; Jon Bauman, effective August 9, 2001 Currently: Jon Bauman