WEST SACRAMENTO, Calif. – Continued growth in the equity market, coupled with a bias to U.S. companies, fed a second year of healthy investment returns at the California State Teachers’ Retirement System (CalSTRS), which closed the 2013-14 fiscal year with an 18.66 percent return on its investments.
WEST SACRAMENTO, Calif. – The California State Teachers’ Retirement System (CalSTRS) today announced the election of Corporate Governance Investment Officer Aeisha Mastagni to the Board of Directors of the International Corporate Governance Network (ICGN).
WEST SACRAMENTO, Calif. – The California State Teachers’ Retirement System (CalSTRS) today announced the Monday, June 30, opening of its Irvine Member Service Center. This is the fourth full-service member center, with other service centers in Santa Clara, Glendale and the CalSTRS Headquarters in West Sacramento.
The Governmental Accounting Standards Board issued two new accounting standards that significantly change the way pensions are reported. Statement 67, Financial Reporting for Pension Plans, becomes effective for CalSTRS in fiscal year 2013-14. Statement 68, Accounting and Reporting for Pensions, becomes effective for plan employers in fiscal year 2014-15.
Among the specific issues identified for cost-sharing, multiple-employer plans, such as CalSTRS, is use of a blended discount rate. The new blended rate considers a long-term rate of return on plan assets, which reflects a pension fund’s long-term investment strategy, and a high-quality, non-taxable municipal bond index rate, to account for the potential need to borrow funds to pay pension benefits after net assets have been fully depleted.
Using this new blended discount rate may cause plans that are projected to run out of assets, like CalSTRS, to appear to have an increased unfunded liability. However, although the liability may be reported on a financial balance sheet as a new, significantly higher amount, the actual current shortfall of approximately $74 billion projected by CalSTRS will not change as a result of the new standards.
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