VIRGINIA RETIREMENT SYSTEM TEACHER RETIREMENT PLAN

Transcription

1 VIRGINIA RETIREMENT SYSTEM TEACHER RETIREMENT PLAN GASB No. 68 Schedules With Independent Auditor s Report Thereon For the Fiscal Year Ended June 30, 2017

2 Table of Contents Independent Auditor s Report 3 VRS Teacher Retirement Plan Schedule of Employer Allocations....6 VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer...16 VRS Teacher Retirement Plan Notes to GASB No. 68 Schedules.21 Page 2 of 35

3 July 12, 2018 Board of Trustees Virginia Retirement System 1200 E. Main Street Richmond, VA INDEPENDENT AUDITOR S REPORT Report on the Schedules We have audited the accompanying schedule of employer allocations of the Virginia Retirement System Teacher Retirement Plan as of and for the year ended June 30, 2017, and the related notes. We have also audited the total for all teacher employers of the columns titled net pension liability, total pension expense, total deferred outflows of resources, and total deferred inflows of resources (specified column totals) included in the accompanying schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer of the Virginia Retirement System Teacher Retirement Plan as of and for the year ended June 30, 2017, and the related notes. Management's Responsibility for the Schedules The Virginia Retirement System s management is responsible for the preparation and fair presentation of these schedules in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the schedules that are free from material misstatement, whether due to fraud or error. Auditor's Responsibility Our responsibility is to express opinions on the schedule of employer allocations and the specified column totals included in the schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer based on our audit. We conducted our audit in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the schedule of employer allocations and the specified column totals included in the (804) reports@apa.virginia.gov Page 3 of 35

4 schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the schedule of employer allocations and the specified column totals included in the schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the schedule of employer allocations and the specified column totals included in the schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of the schedule of employer allocations and the specified column totals included in the schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by the Virginia Retirement System management, as well as evaluating the overall presentation of the schedule of employer allocations and the specified column totals included in the schedule of net pension liability and total pension expense and the schedule of deferred outflows and deferred inflows of resources by employer. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions. Opinions In our opinion, the schedules referred to above present fairly, in all material respects, the employer allocations and net pension liability, total pension expense, total deferred outflows of resources, and total deferred inflows of resources, for the total of all of the participating teacher employers for the Virginia Retirement System Teacher Retirement Plan as of and for the year ended June 30, 2017, in accordance with accounting principles generally accepted in the United States of America. Other Matter We have audited, in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States, the financial statements of the Virginia Retirement System as of and for the year ended June 30, 2017, and our report thereon, dated December 15, 2017, expressed an unmodified opinion on those financial statements. Page 4 of 35

5 Restriction on Use Our report is intended solely for the information and use of the Virginia Retirement System management, the Virginia Retirement System Board of Trustees, the Commonwealth Joint Legislative Audit and Review Commission, and the Virginia Retirement System Teacher Retirement Plan employers and their auditors and is not intended to be and should not be used by anyone other than these specified parties. ZLB/clj AUDITOR OF PUBLIC ACCOUNTS Page 5 of 35

6 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Employer Allocations Page 1 of 5 For the Fiscal Year Ended June 30, 2017 Employer Employer Employer Allocation Code Employer Contributions Percentage Accomack County School Board $ 3,910, % Albemarle County Schools 12,777, % Alleghany County School Board 1,695, % Amelia County School Board 1,239, % Amherst County School Board 3,357, % Appomattox County School Board 1,581, % Arlington Public Schools 41,229, % Augusta County School Board 8,350, % Bath County School Board 668, % Bedford County School Board 6,961, % Bland County School Board 562, % Botetourt County Schools 3,907, % Brunswick County Public Schools 1,390, % Buchanan County School Board 2,045, % Buckingham County School Board 1,545, % Campbell County School Board 5,418, % Caroline County School Board 2,956, % Carroll County School Board 3,120, % Charles City County School Board 671, % Charlotte County School Board 1,612, % Chesterfield County School Board 41,893, % Clarke County School Board 1,721, % Craig County School Board 498, % Culpeper County School Board 6,220, % Cumberland County School Board 1,161, % Dickenson County School Board 1,401, % Dinwiddie County School Board 3,369, % Essex County Public Schools 1,170, % Fairfax County School Board 206,588, % Fauquier County School Board 10,507, % Floyd County School Board 1,457, % Fluvanna County Public Schools 3,426, % Page 6 of 35

7 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Employer Allocations Page 2 of 5 For the Fiscal Year Ended June 30, 2017 Employer Employer Employer Allocation Code Employer Contributions Percentage Franklin County Public Schools 5,928, % Frederick County School Board 12,336, % Giles County Schools 1,751, % Gloucester County School Board 4,335, % Goochland County School Board 2,111, % Grayson County School Board 1,289, % Greene County Public Schools 2,466, % Greensville County School Board 1,774, % Halifax County School Board 4,073, % Hanover County School Board 14,428, % Henrico County School Board 37,325, % Henry County Public Schools 5,250, % Highland County Public Schools 277, % Isle of Wight County Schools 4,194, % King George County School Board 3,250, % King & Queen County School Board 640, % King William County School Board 1,706, % Lancaster County Public Schools 1,097, % Lee County School Board 2,656, % Loudoun County School Board 78,008, % Louisa County Public Schools 3,903, % Lunenburg County School Board 1,105, % Madison County School Board 1,435, % Mathews County School Board 952, % Mecklenburg County School Board 3,197, % Middlesex County School Board 1,056, % Montgomery County School Board 7,165, % Nelson County Public Schools 1,641, % New Kent County School Board 2,263, % Northampton County Schools 1,311, % Northumberland County School Board 1,137, % Nottoway County School Board 1,639, % Orange County Public Schools 3,794, % Page 7 of 35

8 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Employer Allocations Page 3 of 5 For the Fiscal Year Ended June 30, 2017 Employer Employer Employer Allocation Code Employer Contributions Percentage Page County Public Schools 2,653, % Patrick County School Board 1,933, % Pittsylvania County School Board 5,969, % Powhatan County School Board 3,462, % Prince Edward County School Board 1,661, % Prince George County School Board 4,667, % Prince William County School Board 74,811, % Pulaski County School Board 3,142, % Rappahannock County School Board 828, % Richmond County School Board 950, % Roanoke County School Board 11,120, % Rockbridge County School Board 2,327, % Rockingham County School Board 9,314, % Russell County School Board 2,606, % Scott County School Board 2,881, % Shenandoah County School Board 4,935, % Smyth County School Board 3,268, % Southampton County School Board 1,853, % Spotsylvania County School Board 18,178, % Stafford County School Board 21,806, % Surry County Schools 1,147, % Sussex County School Board 1,108, % Tazewell County Schools 3,831, % Warren County School Board 4,174, % Washington County School Board 5,122, % Westmoreland County School Board 1,395, % Wise County School Board 3,993, % Wythe County School Board 3,017, % York County School Board 9,689, % Alexandria City School Board 21,023, % Bristol City School Board 1,789, % Buena Vista City Schools 752, % Charlottesville Public Schools 5,466, % Page 8 of 35

9 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Employer Allocations Page 4 of 5 For the Fiscal Year Ended June 30, 2017 Employer Employer Employer Allocation Code Employer Contributions Percentage Danville City Schools 4,510, % Fredericksburg City Schools 3,284, % Hampton City Schools 15,806, % Harrisonburg City School Board 5,374, % Hopewell City School Board 3,552, % Lynchburg Public Schools 8,073, % Newport News Public Schools 23,034, % Norfolk Public Schools 30,730, % Petersburg City Schools 3,245, % Portsmouth School Board 11,424, % Radford City School Board 1,260, % Richmond Public Schools 22,693, % Roanoke City School Board 11,471, % Staunton City Schools 2,451, % Suffolk City School Board 10,645, % Winchester Public Schools 4,205, % Martinsville City Schools 1,676, % Falls Church Public Schools 3,654, % Colonial Heights City Schools 2,696, % Covington City School Board 817, % Fairfax City School Board 13, % Franklin City Public Schools 1,093, % Chesapeake Public Schools 32,755, % Virginia Beach City School Board 57,883, % Manassas Park City Schools 2,966, % Town of West Point School Board 781, % Lexington City School Board 400, % Waynesboro Public Schools 2,598, % Town of Colonial Beach Schools 516, % Galax City Schools 1,029, % Norton City Schools 545, % Manassas City Schools 7,962, % City of Salem Schools 3,172, % Page 9 of 35

10 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Employer Allocations Page 5 of 5 For the Fiscal Year Ended June 30, 2017 Employer Employer Employer Allocation Code Employer Contributions Percentage Williamsburg-James City County School Board 9,826, % Poquoson City Public Schools 1,664, % Valley Vocational Technical Center 285, % Charlottesville/Albemarle Vo-Tech Center 166, % The Pruden Center for Industry and Technology 192, % Jackson River Technical Center 78, % New Horizons Technical Center 1,183, % Northern Neck Regional Vocational Center 160, % Rowanty Vocational Technical Center 108, % Amelia-Nottoway Vocational Center 30, % Northern Neck Regional Special Education Program 113, % Maggie Walker Governor's School for Govt & Intl Studies 634, % Appomattox Region Governor's School 248, % Bridging Communities Regional Career and Tech Center 65, % Total for all Teacher Employers $ 1,137,903, % The accompanying notes are an integral part of the Schedule of Employer Allocations. Page 10 of 35

11 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense Page 1 of 5 As of and For the Fiscal Year Ended June 30, 2017 (Dollars in Thousands) Net Total Pension Pension Employer Liability Expense Code Employer June 30, 2017 FY Accomack County School Board 42,264 2, Albemarle County Schools 138,093 10, Alleghany County School Board 18, Amelia County School Board 13,394 1, Amherst County School Board 36,284 2, Appomattox County School Board 17,087 1, Arlington Public Schools 445,588 38, Augusta County School Board 90,248 6, Bath County School Board 7, Bedford County School Board 75,240 4, Bland County School Board 6, Botetourt County Schools 42,235 2, Brunswick County Public Schools 15, Buchanan County School Board 22, Buckingham County School Board 16,705 1, Campbell County School Board 58,563 3, Caroline County School Board 31,951 2, Carroll County School Board 33,728 2, Charles City County School Board 7, Charlotte County School Board 17, Chesterfield County School Board 452,768 35, Clarke County School Board 18,603 1, Craig County School Board 5, Culpeper County School Board 67,223 4, Cumberland County School Board 12,551 1, Dickenson County School Board 15, Dinwiddie County School Board 36,413 3, Essex County Public Schools 12, Fairfax County School Board 2,232, , Fauquier County School Board 113,561 7, Floyd County School Board 15,747 1, Fluvanna County Public Schools 37,033 2,206 Page 11 of 35

12 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense Page 2 of 5 As of and For the Fiscal Year Ended June 30, 2017 (Dollars in Thousands) Net Total Pension Pension Employer Liability Expense Code Employer June 30, 2017 FY Franklin County Public Schools 64,075 4, Frederick County School Board 133,333 11, Giles County Schools 18,930 1, Gloucester County School Board 46,860 3, Goochland County School Board 22,821 1, Grayson County School Board 13, Greene County Public Schools 26,657 2, Greensville County School Board 19,184 1, Halifax County School Board 44,023 2, Hanover County School Board 155,936 10, Henrico County School Board 403,402 27, Henry County Public Schools 56,742 3, Highland County Public Schools 2, Isle of Wight County Schools 45,337 2, King George County School Board 35,131 3, King & Queen County School Board 6, King William County School Board 18,441 1, Lancaster County Public Schools 11, Lee County School Board 28,707 1, Loudoun County School Board 843,087 84, Louisa County Public Schools 42,184 3, Lunenburg County School Board 11, Madison County School Board 15, Mathews County School Board 10, Mecklenburg County School Board 34,556 1, Middlesex County School Board 11, Montgomery County School Board 77,443 6, Nelson County Public Schools 17,741 1, New Kent County School Board 24,460 1, Northampton County Schools 14, Northumberland County School Board 12,292 1, Nottoway County School Board 17,720 1,123 Page 12 of 35

13 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense Page 3 of 5 As of and For the Fiscal Year Ended June 30, 2017 (Dollars in Thousands) Net Total Pension Pension Employer Liability Expense Code Employer June 30, 2017 FY Orange County Public Schools 41,008 2, Page County Public Schools 28,673 1, Patrick County School Board 20,894 1, Pittsylvania County School Board 64,515 4, Powhatan County School Board 37,423 2, Prince Edward County School Board 17, Prince George County School Board 50,445 3, Prince William County School Board 808,531 65, Pulaski County School Board 33,960 1, Rappahannock County School Board 8, Richmond County School Board 10, Roanoke County School Board 120,182 8, Rockbridge County School Board 25,153 1, Rockingham County School Board 100,671 7, Russell County School Board 28,167 1, Scott County School Board 31,140 2, Shenandoah County School Board 53,339 3, Smyth County School Board 35,321 1, Southampton County School Board 20,036 1, Spotsylvania County School Board 196,464 12, Stafford County School Board 235,676 16, Surry County Schools 12, Sussex County School Board 11, Tazewell County Schools 41,411 2, Warren County School Board 45,117 2, Washington County School Board 55,366 2, Westmoreland County School Board 15,086 1, Wise County School Board 43,158 2, Wythe County School Board 32,609 1, York County School Board 104,715 8, Alexandria City School Board 227,215 17, Bristol City School Board 19,341 1,086 Page 13 of 35

14 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense Page 4 of 5 As of and For the Fiscal Year Ended June 30, 2017 (Dollars in Thousands) Net Total Pension Pension Employer Liability Expense Code Employer June 30, 2017 FY Buena Vista City Schools 8, Charlottesville Public Schools 59,082 4, Danville City Schools 48,745 1, Fredericksburg City Schools 35,499 3, Hampton City Schools 170,830 10, Harrisonburg City School Board 58,087 4, Hopewell City School Board 38,398 2, Lynchburg Public Schools 87,249 7, Newport News Public Schools 248,946 16, Norfolk Public Schools 332,116 19, Petersburg City Schools 35,072 2, Portsmouth School Board 123,472 6, Radford City School Board 13, Richmond Public Schools 245,257 16, Roanoke City School Board 123,985 10, Staunton City Schools 26,496 1, Suffolk City School Board 115,052 7, Winchester Public Schools 45,450 3, Martinsville City Schools 18,117 1, Falls Church Public Schools 39,492 4, Colonial Heights City Schools 29,138 1, Covington City School Board 8, Fairfax City School Board Franklin City Public Schools 11, Chesapeake Public Schools 354,010 24, Virginia Beach City School Board 625,579 41, Manassas Park City Schools 32,060 3, Town of West Point School Board 8, Lexington City School Board 4, Waynesboro Public Schools 28,083 1, Town of Colonial Beach Schools 5, Galax City Schools 11, Page 14 of 35

15 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Net Pension Liability and Total Pension Expense Page 5 of 5 As of and For the Fiscal Year Ended June 30, 2017 (Dollars in Thousands) Net Total Pension Pension Employer Liability Expense Code Employer June 30, 2017 FY Norton City Schools 5, Manassas City Schools 86,057 6, City of Salem Schools 34,284 1, Williamsburg-James City County School Board 106,201 7, Poquoson City Public Schools 17,993 1, Valley Vocational Technical Center 3, Charlottesville/Albemarle Vo-Tech Center 1, The Pruden Center for Industry and Technology 2, Jackson River Technical Center 849 (77) New Horizons Technical Center 12, Northern Neck Regional Vocational Center 1, Rowanty Vocational Technical Center 1, Amelia-Nottoway Vocational Center Northern Neck Regional Special Education Program 1,231 (1) Maggie Walker Governor's School for Govt & Intl Studies 6, Appomattox Region Governor's School 2, Bridging Communities Regional Career and Tech Center Total for all Teacher Employers $ 12,297,975 $ 906,386 The accompanying notes are an integral part of the Schedule of Net Pension Liability and Total Pension Expense. Page 15 of 35

16 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer Page 1 of 5 As of June 30, 2017 (Dollars in Thousands) Deferred Outflows of Resources Deferred Inflows of Resources Net Net Difference Difference Between Between Projected Projected Differences and Actual Total Differences and Actual Total Between Investment Deferred Between Investment Deferred Expected Earnings on Changes in Outflows Expected Earnings on Changes in Inflows Employer and Actual Pension Plan Change of Proportionate of and Actual Pension Plan Change of Proportionate of Code Employer Experience Investments Assumptions Share Resources Experience Investments Assumptions Share Resources Accomack County School Board $ - $ - $ 617 $ 451 $ 1,068 $ 2,994 $ 1,535 $ - $ 960 $ 5, Albemarle County Schools - - 2,015 2,004 4,019 9,778 5, , Alleghany County School Board , ,192 4, Amelia County School Board , Amherst County School Board ,569 1,318-2,136 6, Appomattox County School Board , , Arlington Public Schools - - 6,502 18,487 24,989 31,552 16, , Augusta County School Board - - 1,317 1,559 2,876 6,390 3,279-1,922 11, Bath County School Board , Bedford County School Board - - 1,098 1,512 2,610 5,328 2,734-4,703 12, Bland County School Board , Botetourt County Schools ,099 2,990 1,534-1,517 6, Brunswick County Public Schools , ,243 2, Buchanan County School Board , ,155 5, Buckingham County School Board , , Campbell County School Board ,228 4,147 2,128-3,811 10, Caroline County School Board ,050 2,262 1, , Carroll County School Board ,432 2,388 1, , Charles City County School Board , Charlotte County School Board , ,124 2, Chesterfield County School Board - - 6,607 7,300 13,907 32,060 16,449-3,073 51, Clarke County School Board , , Craig County School Board , Culpeper County School Board ,060 2,041 4,760 2,442-1,617 8, Cumberland County School Board , Dickenson County School Board , ,933 3, Dinwiddie County School Board ,214 1,745 2,578 1, , Essex County Public Schools , Fairfax County School Board ,589 41,792 74, ,113 81,117-16, , Fauquier County School Board - - 1,657-1,657 8,041 4,126-3,700 15, Floyd County School Board , ,572 Page 16 of 35

17 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer Page 2 of 5 As of June 30, 2017 (Dollars in Thousands) Deferred Outflows of Resources Deferred Inflows of Resources Net Net Difference Difference Between Between Projected Projected Differences and Actual Total Differences and Actual Total Between Investment Deferred Between Investment Deferred Expected Earnings on Changes in Outflows Expected Earnings on Changes in Inflows Employer and Actual Pension Plan Change of Proportionate of and Actual Pension Plan Change of Proportionate of Code Employer Experience Investments Assumptions Share Resources Experience Investments Assumptions Share Resources Fluvanna County Public Schools ,039 2,622 1,345-1,759 5, Franklin County Public Schools ,077 2,012 4,537 2, , Frederick County School Board - - 1,946 5,073 7,019 9,441 4,844-2,128 16, Giles County Schools , , Gloucester County School Board ,161 1,845 3,318 1,702-1,324 6, Goochland County School Board , , Grayson County School Board ,538 3, Greene County Public Schools ,359 1, , Greensville County School Board , ,225 3, Halifax County School Board ,009 3,117 1,599-2,320 7, Hanover County School Board - - 2, ,825 11,043 5,665-2,571 19, Henrico County School Board - - 5,887 1,891 7,778 28,565 14,656-5,724 48, Henry County Public Schools ,018 2,061-1,232 7, Highland County Public Schools Isle of Wight County Schools ,211 1,647-2,468 7, King George County School Board ,916 3,429 2,489 1, , King & Queen County School Board , King William County School Board , , Lancaster County Public Schools , Lee County School Board ,032 1,043-1,316 4, Loudoun County School Board ,303 68,435 80,738 59,697 30, , Louisa County Public Schools ,164 2,987 1, , Lunenburg County School Board ,396 2, Madison County School Board , , Mathews County School Board , Mecklenburg County School Board ,447 1,255-2,607 6, Middlesex County School Board , Montgomery County School Board - - 1,130 1,540 2,670 5,483 2, , Nelson County Public Schools , , New Kent County School Board , , Northampton County Schools , ,389 Page 17 of 35

18 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer Page 3 of 5 As of June 30, 2017 (Dollars in Thousands) Deferred Outflows of Resources Deferred Inflows of Resources Net Net Difference Difference Between Between Projected Projected Differences and Actual Total Differences and Actual Total Between Investment Deferred Between Investment Deferred Expected Earnings on Changes in Outflows Expected Earnings on Changes in Inflows Employer and Actual Pension Plan Change of Proportionate of and Actual Pension Plan Change of Proportionate of Code Employer Experience Investments Assumptions Share Resources Experience Investments Assumptions Share Resources Northumberland County School Board , Nottoway County School Board , , Orange County Public Schools ,306 2,904 1,490-1,398 5, Page County Public Schools ,029 1,042-1,250 4, Patrick County School Board , , Pittsylvania County School Board ,914 4,568 2, , Powhatan County School Board ,650 1, , Prince Edward County School Board , ,442 4, Prince George County School Board ,000 1,736 3,572 1,833-2,027 7, Prince William County School Board ,799 19,507 31,306 57,252 29, , Pulaski County School Board ,404 1,234-2,148 5, Rappahannock County School Board , Richmond County School Board , Roanoke County School Board - - 1,754 3,314 5,068 8,510 4,366-2,945 15, Rockbridge County School Board , , Rockingham County School Board - - 1,469 1,045 2,514 7,128 3,657-1,068 11, Russell County School Board ,995 1,023-1,049 4, Scott County School Board ,205 1, , Shenandoah County School Board ,710 3,776 1,938-1,348 7, Smyth County School Board ,501 1,283-3,280 7, Southampton County School Board , ,063 3, Spotsylvania County School Board - - 2, ,425 13,911 7,138-5,728 26, Stafford County School Board - - 3,439 4,654 8,093 16,688 8,562-5,218 30, Surry County Schools , Sussex County School Board , Tazewell County Schools ,932 1,504-2,708 7, Warren County School Board ,194 1,639-1,259 6, Washington County School Board ,921 2,011-2,936 8, Westmoreland County School Board ,179 1, , Wise County School Board ,004 3,056 1,568-4,545 9, Wythe County School Board ,309 1,185-1,352 4,846 Page 18 of 35

19 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer Page 4 of 5 As of June 30, 2017 (Dollars in Thousands) Deferred Outflows of Resources Deferred Inflows of Resources Net Net Difference Difference Between Between Projected Projected Differences and Actual Total Differences and Actual Total Between Investment Deferred Between Investment Deferred Expected Earnings on Changes in Outflows Expected Earnings on Changes in Inflows Employer and Actual Pension Plan Change of Proportionate of and Actual Pension Plan Change of Proportionate of Code Employer Experience Investments Assumptions Share Resources Experience Investments Assumptions Share Resources York County School Board - - 1,528 3,019 4,547 7,415 3,804-2,105 13, Alexandria City School Board - - 3,316 6,295 9,611 16,089 8,255-2,529 26, Bristol City School Board , ,086 3, Buena Vista City Schools , Charlottesville Public Schools ,112 1,974 4,184 2, , Danville City Schools ,451 1,771-5,652 10, Fredericksburg City Schools ,226 1,744 2,513 1, , Hampton City Schools - - 2, ,350 12,097 6,206-8,326 26, Harrisonburg City School Board ,720 3,568 4,113 2, , Hopewell City School Board ,008 1,568 2,718 1,395-1,118 5, Lynchburg Public Schools - - 1,273 2,830 4,103 6,177 3,170-2,145 11, Newport News Public Schools - - 3, ,666 17,628 9,044-5,772 32, Norfolk Public Schools - - 4,846-4,846 23,517 12,066-17,117 52, Petersburg City Schools ,142 2,483 1,274-3,305 7, Portsmouth School Board - - 1,802-1,802 8,743 4,486-7,653 20, Radford City School Board , Richmond Public Schools - - 3,579 6,401 9,980 17,366 8,910-11,790 38, Roanoke City School Board - - 1,809 2,256 4,065 8,779 4, , Staunton City Schools , , Suffolk City School Board - - 1,679 2,364 4,043 8,147 4,180-3,533 15, Winchester Public Schools ,477 3,218 1, , Martinsville City Schools , ,787 3, Falls Church Public Schools ,896 3,472 2,796 1, , Colonial Heights City Schools ,063 1,059-1,604 4, Covington City School Board , Fairfax City School Board Franklin City Public Schools , Chesapeake Public Schools - - 5,166 2,693 7,859 25,068 12,861-8,248 46, Virginia Beach City School Board - - 9,129 1,917 11,046 44,297 22,728-14,696 81, Manassas Park City Schools ,891 3,359 2,270 1,165-2,004 5, Town of West Point School Board ,055 Page 19 of 35

20 Virginia Retirement System VRS Teacher Retirement Plan Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer Page 5 of 5 As of June 30, 2017 (Dollars in Thousands) Deferred Outflows of Resources Deferred Inflows of Resources Net Net Difference Difference Between Between Projected Projected Differences and Actual Total Differences and Actual Total Between Investment Deferred Between Investment Deferred Expected Earnings on Changes in Outflows Expected Earnings on Changes in Inflows Employer and Actual Pension Plan Change of Proportionate of and Actual Pension Plan Change of Proportionate of Code Employer Experience Investments Assumptions Share Resources Experience Investments Assumptions Share Resources Lexington City School Board Waynesboro Public Schools ,989 1, , Town of Colonial Beach Schools Galax City Schools , Norton City Schools , Manassas City Schools - - 1,256 1,784 3,040 6,094 3,126-2,797 12, City of Salem Schools ,427 1,246-1,572 5, Williamsburg-James City County School Board - - 1,550 1,197 2,747 7,520 3,858-1,725 13, Poquoson City Public Schools , , Valley Vocational Technical Center Charlottesville/Albemarle Vo-Tech Center The Pruden Center for Industry and Technology Jackson River Technical Center New Horizons Technical Center , Northern Neck Regional Vocational Center Rowanty Vocational Technical Center Amelia-Nottoway Vocational Center Northern Neck Regional Special Education Program Maggie Walker Governor's School for Govt & Intl Studies Appomattox Region Governor's School Bridging Communities Regional Career and Tech Center Total for all Teacher Employers $ - $ - $ 179,461 $ 255,906 $ 435,367 $ 870,809 $ 446,790 $ - $ 255,906 $ 1,573,505 The accompanying notes are an integral part of the Schedule of Deferred Outflows and Deferred Inflows of Resources by Employer. Page 20 of 35

21 Virginia Retirement System VRS Teacher Retirement Plan Notes to GASB No. 68 Schedules For The Fiscal Year Ended June 30, 2017 Note 1. Summary of Significant Accounting Policies Description of the Entity The Virginia Retirement System (the System) is an independent agency of the Commonwealth of Virginia. The System administers four separate pension trust funds the Virginia Retirement System (VRS), the State Police Officers Retirement System (SPORS), the Virginia Law Officers Retirement System (VaLORS), and the Judicial Retirement System (JRS). The VRS Teacher Retirement Plan is part of the VRS Trust Fund. Administration and Management The Board of Trustees (the Board) is responsible for the general administration and operation of the defined benefit pension plans and the other employee benefit plans. The Board has full power to invest and reinvest the trust funds of the System through the adoption of investment policies and guidelines that fulfill the Board s investment objective to maximize long-term investment returns while targeting an acceptable level of risk. The Board consists of nine members. Five members are appointed by the Governor and four members are appointed by the Joint Rules Committee of the General Assembly subject to confirmation by the General Assembly. The Board appoints a Director to serve as the Chief Administrative Officer of the System and a Chief Investment Officer to direct, manage, and administer the investment of the System s funds. The System issues a Comprehensive Annual Financial Report (CAFR) containing the financial statements and required supplementary information for all of the System s pension and other employee benefit trust funds. The CAFR is publically available through the About VRS link on the VRS website at or a copy may be obtained by submitting a request to the VRS Chief Financial Officer, PO Box 2500, Richmond, VA The pension and other employee benefit trust funds administered by the VRS are classified as fiduciary funds and are included in the basic financial statements of the Commonwealth of Virginia. Pensions For purposes of measuring the net pension liability, deferred outflows of resources and deferred inflows of resources related to pensions, and pension expense, information about the fiduciary net position of the Virginia Retirement System (VRS) Teacher Retirement Plan and the additions to/deductions from the VRS Teacher Retirement Plan s net fiduciary position have been determined on the same basis as they were reported by VRS. For this purpose, benefit payments (including refunds of employee contributions) are Page 21 of 35

22 recognized when due and payable in accordance with the benefit terms. Investments are reported at fair value. Note 2. General Information about the Pension Plan Plan Description All full-time, salaried permanent (professional) employees of public school divisions are automatically covered by the VRS Teacher Retirement Plan upon employment. This plan is administered by the Virginia Retirement System (the System) along with plans for other employer groups in the Commonwealth of Virginia. The VRS Teacher Retirement Plan is a multiple-employer cost-sharing plan. Members earn one month of service credit for each month they are employed and for which they and their employer pay contributions to VRS. Members are eligible to purchase prior service, based on specific criteria a defined in the Code of Virginia, as amended. Eligible prior service that may be purchased includes prior public service, active military service, certain periods of leave, and previously refunded service. The System administers three different benefit structures for covered employees in the VRS Teacher Retirement Plan Plan 1, Plan 2, and, Hybrid. Each of these benefit structures has different eligibility criteria. The specific information for each plan, and the eligibility for covered groups within each plan are set out in the table below: RETIREMENT PLAN PROVISIONS BY PLAN STRUCTURE HYBRID PLAN 1 PLAN 2 RETIREMENT PLAN About Plan 1 Plan 1 is a defined benefit plan. The retirement benefit is based on a member s age, creditable service and average final compensation at retirement using a formula. About Plan 2 Plan 2 is a defined benefit plan. The retirement benefit is based on a member s age, creditable service and average final compensation at retirement using a formula. About the Hybrid Retirement Plan The Hybrid Retirement Plan combines the features of a defined benefit plan and a defined contribution plan The defined benefit is based on a member s age, creditable service and average final compensation at retirement using a formula. The benefit from the defined contribution component of the plan depends on the member and employer contributions made to the plan and the Page 22 of 35

23 investment performance of those contributions. In addition to the monthly benefit payment payable from the defined benefit plan at retirement, a member may start receiving distributions from the balance in the defined contribution account, reflecting the contributions, investment gains or losses, and any required fees. Eligible Members Employees are in Plan 1 if their membership date is before July 1, 2010, and they were vested as of January 1, 2013 and they have not taken a refund. Hybrid Opt-In Election VRS Plan 1 members were allowed to make an irrevocable decision to opt into the Hybrid Retirement Plan during a special election window held January 1 through April 30, The Hybrid Retirement Plan s effective date for eligible Plan 1 members who opted in was July 1, If eligible deferred members returned to work during the election window, they were also eligible to opt into the Hybrid Retirement Plan. Eligible Members Employees are in Plan 2 if their membership date is on or after July 1, 2010, or their membership date is before July 1, 2010, and they were not vested as of January 1, Hybrid Opt-In Election Eligible Plan 2 members were allowed to make an irrevocable decision to opt into the Hybrid Retirement Plan during a special election window held January 1 through April 30, The Hybrid Retirement Plan s effective date for eligible Plan 2 members who opted in was July 1, If eligible deferred members returned to work during the election window, they were also eligible to opt into the Hybrid Retirement Plan. Eligible Members Employees are in the Hybrid Retirement Plan if their membership date is on or after January 1, This includes: School division employees Members in Plan 1 or Plan 2 who elected to opt into the plan during the election window held January 1-April 30, 2014; the plan s effective date for opt-in members was July 1, 2014 Page 23 of 35

24 Retirement Contributions Employees contribute 5% of their compensation each month to their member contribution account through a pre-tax salary reduction. Member contributions are taxdeferred until they are withdrawn as part of a retirement benefit or as a refund. The employer makes a separate actuarially determined contribution to VRS for all covered employees. VRS invests both member and employer contributions to provide funding for the future benefit payment. Retirement Contributions Employees contribute 5% of their compensation each month to their member contribution account through a pre-tax salary reduction. Retirement Contributions A member s retirement benefit is funded through mandatory and voluntary contributions made by the member and the employer to both the defined benefit and the defined contribution components of the plan. Mandatory contributions are based on a percentage of the employee s creditable compensation and are required from both the member and the employer. Additionally, members may choose to make voluntary contributions to the defined contribution component of the plan, and the employer is required to match those voluntary contributions according to specified percentages. Creditable Service Creditable service includes active service. Members earn creditable service for each month they are employed in a covered position. It also may include credit for prior service the member has purchased or additional creditable service the member was granted. A member s total creditable service is one of the factors used to determine their eligibility for retirement and to calculate their retirement benefit. It also may count toward eligibility for the health insurance credit in retirement, if the employer offers the health insurance credit. Creditable Service Same as Plan 1. Creditable Service Defined Benefit Component: Under the defined benefit component of the plan, creditable service includes active service. Members earn creditable service for each month they are employed in a covered position. It also may include credit for prior service the member has purchased or additional creditable service the member was granted. A member s total creditable service is one of the factors used to determine their eligibility for retirement and to calculate their retirement benefit. It also may count toward eligibility for the health insurance credit in retirement, Page 24 of 35

25 if the employer offers the health insurance credit. Defined Contributions Component: Under the defined contribution component, creditable service is used to determine vesting for the employer contribution portion of the plan. Vesting Vesting is the minimum length of service a member needs to qualify for a future retirement benefit. Members become vested when they have at least five years (60 months) of creditable service. Vesting means members are eligible to qualify for retirement if they meet the age and service requirements for their plan. Members also must be vested to receive a full refund of their member contribution account balance if they leave employment and request a refund. Members are always 100% vested in the contributions that they make. Vesting Same as Plan 1. Vesting Defined Benefit Component: Defined benefit vesting is the minimum length of service a member needs to qualify for a future retirement benefit. Members are vested under the defined benefit component of the Hybrid Retirement Plan when they reach five years (60 months) of creditable service. Plan 1 or Plan 2 members with at least five years (60 months) of creditable service who opted into the Hybrid Retirement Plan remain vested in the defined benefit component. Defined Contributions Component: Defined contribution vesting refers to the minimum length of service a member needs to be eligible to withdraw the employer contributions from the defined contribution component of the plan. Members are always 100% vested in the contributions that they make. Upon retirement or leaving covered employment, a Page 25 of 35

26 member is eligible to withdraw a percentage of employer contributions to the defined contribution component of the plan, based on service. After two years, a member is 50% vested and may withdraw 50% of employer contributions. After three years, a member is 75% vested and may withdraw 75% of employer contributions. After four or more years, a member is 100% vested and may withdraw 100% of employer contributions. Distribution is not required by law until age 70½. Calculating the Benefit The Basic Benefit is calculated based on a formula using the member s average final compensation, a retirement multiplier and total service credit at retirement. It is one of the benefit payout options available to a member at retirement. An early retirement reduction factor is applied to the Basic Benefit if the member retires with a reduced retirement benefit or selects a benefit payout option other than the Basic Benefit. Calculating the Benefit See definition under Plan 1. Calculating the Benefit Defined Benefit Component: See definition under Plan 1 Defined Contribution Component: The benefit is based on contributions made by the member and any matching contributions made by the employer, plus net investment earnings on those contributions. Average Final Compensation A member s average final compensation is the average of the 36 consecutive months of Average Final Compensation A member s average final compensation is the average of their 60 consecutive months of Average Final Compensation Same as Plan 2. It is used in the retirement formula for the Page 26 of 35