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Meeting of the Board of Directors of the Pension Benefit Guaranty Corporation November 13, 2014

Meeting of the Board of Directors of the Pension Benefit Guaranty Corporation November 13, 2014

Designated Representatives of the Board Members (by telephone)

Phyllis C. Borzi, Assistant Secretary of Labor, Employee Benefits Security
Administration
(Designated Representative of Secretary of Labor Thomas E. Perez)
Matthew Rutherford, Acting Under Secretary of the Treasury for Domestic
Finance
(Designated Representative of Secretary of the Treasury Jacob J. Lew)
Mark Doms, Under Secretary for Economic Affairs
(Designated Representative of Secretary of Commerce Penny Pritzker)

PBGC

Alice Maroni, Acting Director
Ann Orr, Chief of Staff
Judith R. Starr, General Counsel and Secretary to the Board
Patricia Kelly, Chief Financial Officer
Sanford Rich, Chief, Negotiations and Restructuring
Cathy Kronopolous, Acting Chief Benefits Administrator
Edgar Bennett, Acting Chief Management Officer
Michael Rae, Acting Deputy Chief Policy Officer
Theodore Winter, Director, Financial Operations Department
Christopher Bone, Director, Policy, Research and Analysis Department
Walter Luiza, Deputy Director, Financial Operations Department
Bruce Johnson, Financial Operations Department
Anthony Castoro, Accountant, Financial Operations Department
Martin Boehm, Director, Contract, Controls Review Department
Dave Harvey, Deputy Director, Contracts and Controls Review Department
Scott Young, Chief Actuary, Benefits Administration and Payment Department
James Donofrio, Actuary, Office of Negotiations and Restructuring
Sanford McLaurin, Director, Communications, Outreach and Legislative Affairs
Martha Threatt, Deputy Director, Communications, Outreach and Legislative
Affairs
Deva Kyle, Office of Policy and External Affairs

PBGC’s Office of Inspector General

Deborah Stover-Springer, Acting Inspector General
Rashmi Bartlett, Assistant Inspector General for Audit
Joseph Marchowksy, Audit Manager

Other Board Agency Staff (by telephone)

Kendra Kosko, Employee Benefits Law Specialist, Office of Policy and
Research, Employee Benefits Security Administration, Department of Labor
Hilary Duke, Division Chief, Office of Policy and Research, Employee
Benefits Security Administration, Department of Labor
Rick Lattimer, Policy Analyst, Economics and Statistics Administration,
Department of Commerce
Patricia Kao, Acting Director, Office of Financial Institutions Policy,
Department of the Treasury
Sam Valverde, Senior Advisor to the Under Secretary for Domestic Finance,
Department of the Treasury
Philip Quinn, Senior Policy Analyst, Department of the Treasury
Kim Egert, Policy Advisor, Department of the Treasury
Liz Hipple, Policy Advisor, Department of the Treasury

CliftonLarsonAllen (outside audit firm)

Patrick Byer, Principal
George Fallon, Principal (by telephone)
Marlon Perry, Senior Manager
David Harris, IT Senior Manager (by telephone)
Wilson Kayo, Audit Director (by telephone)

 

The Board, through its representatives duly designated pursuant to section 4002.3(b)(1) of the Corporation’s Bylaws, met on November 13, 2014. The Acting Chair, Assistant Secretary of Labor Phyllis C. Borzi, called the meeting to order at 11:30 a.m.

The Acting Chair thanked PBGC management and staff for all their hard work throughout the financial audit, and also thanked the Acting Inspector General and the OIG staff. She explained that the purpose of the meeting was to review and approve transmittal of the Corporation’s fiscal year 2014 financial statements, annual performance report, independent auditors report, and other documentation in conformance with OMB Circular A-11, to the President, the Congress, and the Director of the Office of Management and Budget by November 17, as November 15 falls on a Saturday. Additionally, the report is supplemented by the Chair’s message and the Director’s message. She stated that the Board would approve the PBGC fiscal year 2014 Annual Report required by section 4008 of ERISA once the actuarial analysis required by that section is completed. The Acting Chair noted that, on approval, the report comprising these documents will not be immediately released but will be subject to technical corrections agreed to among the Board Representatives. The minutes of this meeting will be circulated to the Board Members with their approval thereof constituting ratification of the acts of the Board Representatives.

Acting Director Alice Maroni echoed the Acting Chair’s thanks, emphasizing the leadership of Chief Financial Officer Patricia Kelly and Financial Operations Department Director Ted Winter in keeping PBGC staff on task. Ms. Maroni further noted that this year’s audit marks PBGC’s 22d year with an unmodified opinion.

The Acting Chair thanked Ms. Maroni for her leadership and recognized Acting Inspector General Deborah Stover-Springer.

Acting Inspector General Deborah Stover-Springer discussed the audit process and then introduced CliftonLarsonAllen principal Patrick Byer.

Mr. Byer presented the highlights of the independent auditor’s report. The auditors are issuing an unmodified opinion, which is PBGC’s 22d consecutive such opinion. In addition, PBGC has closed the significant deficiency on integration of financial systems. The auditors are again issuing an adverse opinion on internal controls, based on the same three material weaknesses as last year. Although management has worked to address issues raised by the auditors, there remain issues to be addressed. The reporting of an issue regarding fair market value of plan assets in the section on compliance with laws and regulations is also a repeat from last year. In addition, the report adds two new significant deficiencies relating to financial reporting and multiemployer liabilities that are discussed in more detail in the supplemental report. Finally, Mr. Byer acknowledged the cooperation of management throughout the audit.

The Acting Chair thanked PBGC management, the Office of Inspector General, and CliftonLarsonAllen for all their hard work. She then requested a motion to approve, absent any material changes, transmittal of the Corporation’s fiscal year 2014 financial statements, annual performance report, independent auditors report, and other documentation in conformance with OMB Circular A-11, supplemented by the Chair’s message and the Director’s message, to the President, the Congress, and the Office of Management and Budget by November 17. The motion was made, and upon being seconded, passed.

The meeting adjourned at 11:48.

Last updated April 27, 2017