Fla. Admin. Code R. 60T-1.003

Current through Reg. 50, No. 222; November 13, 2024

Section 60T-1.003 - Actuarial Reports

(1) Each plan sponsor shall on its own or through the administrator or trustees of the plan have an actuarial report prepared for each of its defined benefit retirement plans or systems by an enrolled actuary at least every three (3) years commencing from the date of the last actuarial report of the plan or system on October 1, 1980, if no actuarial report has been issued within the three year period prior to October 1, 1979. In addition, actuarial cost determinations recommending the contribution amount, rate or other basis applicable to periods for which an actuarial valuation has not been specifically prepared are to be also provided to the Division within 60 days of receipt by the plan administrator. No actuarial report is required for defined contribution retirement plans or systems. However, the plan sponsor of each defined contribution plan shall provide such information and financial statements, as are necessary to gather, catalog, and maintain complete information on all public employee retirement systems to the Division upon its request.

(2) The results of each actuarial report shall be filed with the plan administrator within 60 days after completion and certification by the actuary and made available for inspection upon request. Also, the system or plan shall provide a copy of each actuarial report to the Division within 60 days of receipt from the actuary.

(3) Actuarial reports shall contain all data required by Section 112.63(1), F.S., which consist of the following:

(a) The values of the present assets, based on market value and "statement value":

Cash

Bonds

Stocks

Other (specify)

Disclose the derivation of the actuarial asset value used in determining the annual funding requirement.

(b) A plan to amortize any unfunded liability pursuant to Section 112.64, F.S.

(c) A schedule illustrating the amortization of unfunded liabilities as they exist on the date of the valuation, on an annual basis for the three years immediately following the current valuation date and the final year of the amortization schedule must be disclosed, as well as a statement as to how the method was derived.

(d) A description of actions taken by the governmental entity to reduce the unfunded liability, especially those taken since the last actuarial report.

(e) A description and explanation of all actuarial assumptions.

(f) A comparative review illustrating the rates of salary increases granted and investment return realized over the three-year period preceding the current actuarial report with the assumptions used. The actual salary increase rate may be determined for the period between the immediately preceding actuarial valuation date and the current valuation date; however, such rate shall be shown on an annualized basis. Rate of actual salary increases shall be determined by using the aggregate of actual salary increases granted, excluding new entrants and terminations. Investment return rates shall be determined for each year and reported on a consistent basis for each year in the three-year period. There should also be an explanation of how the investment return rate was determined.

(g) A statement by the enrolled actuary, in the form of a certification signed and dated by the actuary, as follows:

Statement by Enrolled Actuary "This actuarial valuation and/or cost determination was prepared and completed by me or under my direct supervision, and I acknowledge responsibility for the results. To the best of my knowledge, the results are complete and accurate, and in my opinion, the techniques and assumptions used are reasonable and meet the requirements and intent of Part VII, Chapter 112, Florida Statutes. There is no benefit or expense to be provided by the plan and/or paid from the plan's assets for which liabilities or current costs have not been established or otherwise taken into account in the valuation. All known events or trends which may require a material increase in plan costs or required contribution rates have been taken into account in the valuation."

	_____________________
	Signature
	_____________________
	Date
	_____________________
	Enrollment Number

(4) Actuarial valuation reports shall, at a minimum, disclose such information that another actuary, unfamiliar with the situation, would find the information sufficient to appraise the reports' conclusions and to arrive at reasonably similar results. In order for the Division to determine the completeness, accuracy, and reasonableness of the assumptions, such information shall, at a minimum, include the following items:

(a) The date as of which the valuation was prepared, and the beginning and ending dates of the period for which the recommended contributions are applicable.

(b) The overall valuation results, the adequacy of employer and employee contribution rates in meeting the levels of employee benefits provided in the system and changes, if any, needed in such rates to achieve or preserve a level of funding deemed adequate to enable payment through the indefinite future of the benefit amounts prescribed by the system.

(c) A brief summary of the retirement plan provisions.

(d) The funding method explained in sufficient detail so that another actuary could, using the same method, arrive at similar results.

(e) For actuarial valuation reports which cover more than one employee group, benefit program, and/or more than one plan, and the valuation calculations are made separately, the applicable valuation results shall be disclosed separately.

(f) Disclosure of any benefit and expense to be provided by the plan and/or paid from the plan's assets for which no liabilities or current costs have been established or otherwise provided for, including an explanation of the omission and the cost effect thereof.

(g) Disclosure of any event which the actuary has not taken into account and any trend which, for purposes of the actuarial assumptions used, was not assumed to continue in the future, but only if, to the best of the actuary's knowledge, such event or trend may require a material increase in plan costs or required contribution rates.

(h) Disclosure, for each plan year, of the derivation of the current unfunded actuarial accrued liability from the amount established as of the immediately preceding valuation date. (Unfunded actuarial accrued liabilities are amortized by nonemployee contributions in excess of normal cost and interest requirements.) The disclosure shall, minimally, include the following:

1.	Total unfunded actuarial accrued liability for the immediately prior actuarial valuation date (state date)	$______
2.	Plan sponsor normal cost for this plan year	$______
3.	Interest accrued on 1. and 2.	$______
4.	Plan sponsor contributions for this plan year (including amounts expected to be paid)	$______
5.	Interest on 4.	$______
6.	Changes due to a. + b. + c. + d	$______
a.	assumptions	$______
b.	funding method	$______
c.	plan amendments	$______
d.	actuarial gain/loss	$______
7.	Total current unfunded actuarial accrued liability 1. + 2. + 3. - 4. - 5. + 6.	$______

(i) Demographic and financial statistics on the members (active, terminated with rights to deferred benefits, and retired and beneficiaries) in the retirement system including but not limited to an age and service distribution table for active members. This section shall provide a reconciliation between current data and data in the most recent state approved valuation of the active, terminated with rights to deferred benefits, and retired membership (and beneficiaries). (A projection of emerging liabilities/cash flow needs for the next 10-15 years would be beneficial.)

(j) An annual reconciliation of the plan's assets from the balance determined as of the immediately preceding valuation date to the balance as of the current valuation date. If the reconciliation is done on a basis other than that used for annual funding requirements, the reconciliation shall show the dollar relationship to actuarial value of assets as used in determining the annual funding requirements. The reconciliation should show separately, at a minimum:

Contributions by source

Interest and dividends

Realized gains (losses)

Increase (decrease) in unrealized appreciation, if applicable (net)

Pension payments

Contribution refunds

Expenses

Other receipts (identify)

Other disbursements (identify)

(k) The amount of active members accumulated contributions (with interest, if provided by plan).

(l) A comparative summary of principal valuation results, essentially in the following format:

COMPARATIVE SUMMARY OF PRINCIPAL VALUATION RESULTS
(Not a required format - to be used as a guide only)
		Actuarial Valuation Prepared as of
1.	Participant Data	Current Date	Prior Date
	Active members	#_________	#_________
	Total annual payroll	$_________	$_________
	Retired members and beneficiaries (other than disabled)	#_________	#_________
	Total annualized benefit	$_________	$_________
	Disabled members receiving benefits	#_________	#_________
	Total annualized benefit	$_________	$_________
	Terminated vested members	#_________	#_________
	Total annualized benefit	$_________	$_________
2.	Assets	$_________	$_________
	Actuarial value of assets	$_________	$_________
	Market value of assets		$_________
3.	Liabilities
	Present value of all future expected benefit payments:
	Active members	$_________	$_________
	Retirement benefits	$_________	$_________
	Vesting benefits	$_________	$_________
	Disability benefits	$_________	$_________
	Death benefits	$_________	$_________
	Return of contribution	$_________	$_________
	Total	$_________	$_________
	Terminated vested members	$_________	$_________
	Retired members and beneficiaries:
	Retired (other than disabled) and beneficiaries	$_________	$_________
	Disabled members	$_________	$_________
	Total	$_________	$_________
	Total present value of all future expected benefit	$_________	$_________
	Payments	$_________	$_________
	Liabilities due and unpaid	$_________	$_________
	*Actuarial accrued liability	$_________	$_________
	*Unfunded actuarial
	*Refers to liabilities not funded by future normal cost contributions. Show amount, date and amortization period at establishment, and current amount of each such liability not amortized
4.	Actuarial present value of accrued benefits (to be determined in accordance with a. and b. below)
	Statement of actuarial present value of all accrued benefits
	Vested accrued benefits	$_________	$_________
	Inactive members and beneficiaries	$_________	$_________
	Active members (includes nonforfeitable accumulated member contributions in the amount of _____)	$_________	$_________
	Total value of all vested accrued benefits	$_________	$_________
	Non-vested accrued benefits	$_________	$_________
	Total actuarial present value of all accrued benefits	$_________	$_________
	Statement of changes in total actuarial present value of all accrued benefits	$_________	$_________
	Actuarial present value of accrued benefits at beginning of year	$_________	$_________
	Increase (decrease) during year attributable to (where applicable):
	Plan amendment	$_________	$_________
	Changes in actuarial assumptions	$_________	$_________
	Increase for interest and probability of payment due to decrease in discount period and benefits accrued	$_________	$_________
	Benefits paid	$_________	$_________
	Other changes (identify and state amount)	$_________	$_________
	Net increase (decrease)	$_________	$_________
	Actuarial present value of accrued benefits at end of year	$_________	$_________

a. Accrued benefits are those future promised benefits that are determined in accordance with the plan's provisions based on the service members have rendered to the actuarial valuation date. Accrued benefits are those payable under all applicable plan circumstances - retirement, death, disability, and termination of employment - to the extent they are deemed attributable to member service rendered to the valuation date. Benefits to be provided by insured contracts for which the plan sponsor has no future liability and which are excluded from plan assets are to be excluded from plan benefits.

b. All determinations are to be on a consistent basis. Any change is to be disclosed, together with an explanation. The exhibit entries for the actuarial valuation date as of which a change is made shall show the entries on a before and after change basis.

5.	Pension cost (specify applicable funding period)
	Normal cost (show cost for each benefit if so calculated and amount for administrative expenses, if applicable)	$_________	$_______
	Payment to amortize unfunded liability	$_________	$_______
	Expected plan sponsor contribution (including normal cost, amortization payment and interest, as applicable)	$_________	$_______
	As % of payroll	__________%	________%
	Amount to be contributed by members	$_________	$_______
	As % of payroll	__________%	________%
6.	Past contributions For each plan year since last report:
	Required plan sponsor contribution	$_________	$_________
	Required member contribution	$_________	$_________
	Actual contributions made by:
	Plan's sponsor	$_________	$_________
	Members	$_________	$_________
	Other (e.g., Chapters 175 or 185, F.S.)	$_________	$_________
7.	Net actuarial gain (loss) (if applicable)	$_________	$_________
8.	Other disclosures (where applicable)	$_________	$_________
	Present value of active member:
	Future salaries at attained age	$_________	$_________
	at entry age	$_________	$_________
	Future contributions at attained age	$_________	$_________
	at entry age	$_________	$_________
	Present value of future	$_________	$_________
	contributions from other sources (identify)	$_________	$_________
	Present value of future expected benefit payments for active members at entry age	$_________	$_________

(5) The actuarial cost methods utilized for establishing the amount of the annual actuarial normal cost to support the promised benefits shall only be those methods approved in the Employee Retirement Income Security Act of 1974, and as permitted under regulations prescribed by the Secretary of the Treasury.

The funding method utilized for the actuarial report and the resulting recommendation for contributions required to fund the retirement plan shall minimally provide a contribution sufficient to meet the normal cost and to amortize the unfunded liability, if any, in accordance with Section 112.64, F.S.

(6) Actuarial assumptions selected for the actuarial valuation report should reflect the actuary's best judgment of future events. They should take into account the actual experience of the covered group. The actuary should consider the impact of inflation on appropriate assumptions. The preferred approach in selecting actuarial assumptions is the use of explicit assumptions which more nearly represent the actuary's best estimates of anticipated plan experience under each assumption. Actuarial assumptions which consistently generate experience gains or losses are prima facie indications of unreasonable actuarial assumptions.

(7) Whenever an actuarial valuation is based on actuarial assumptions or cost methods different from those used in the preceding valuation, the current valuation must clearly indicate the effect on projected liabilities and costs resulting from the new assumptions and/or funding methods.

(8) Administrative expenses paid from the funds being accumulated to support the promised benefits shall be paid on a current basis in addition to the annual funding costs otherwise determined.

(9) Annual funding costs or cost contribution rates determined as of a valuation date but to be paid at a later date or applicable to a period beginning at a later date are to be appropriately adjusted to reflect the intervening time interval. The adjustment shall provide for, but not be limited to, adjustments to account for interest and/or salary increase, as appropriate.

(10) Recommended changes in contributions or contribution rates determined as of a valuation date shall be effective not later than the first of the next fiscal year following the valuation date.

(11) Unless otherwise indicated or contrary to Chapter 112, F.S., all actuarial procedures and determinations are to be in accordance with commonly accepted procedures and determinations. Internal Revenue Service publications should be used as the standard.

Fla. Admin. Code Ann. R. 60T-1.003

Rulemaking Authority 112.665(1) FS. Law Implemented 112.63 FS.

New 5-6-81, Amended 9-19-83, 8-15-84, Formerly 22D-1.03, Amended 11-14-91, Formerly 22D-1.003, Amended 2-23-95, Amended by Florida Register Volume 41, Number 126, June 30, 2015 effective 7/16/2015.

New 5-6-81, Amended 9-19-83, 8-15-84, Formerly 22D-1.03, Amended 11-14-91, Formerly 22D-1.003, Amended 2-23-95, 7-16-15.