California State Teachers Retirement System

Transcription

1 California State Teachers Retirement System Presentation for annual audit of financial statements Audits and Risk Management Committee April 5, Crowe Horwath LLP 2017 Crowe Horwath LLP

2 With You Today Brenda Torres, CPA Signing Partner Kevin Smith, CPA Client Service Partner Mike Van Duyn, CPA Investment Valuation & Audit Methodology Partner Craig Sullivan, CPA, CISA, QSA IT Risk Partner Alexis Fitzpatrick, CPA On-site Senior Manager 2

3 Crowe Horwath LLP: Building Lasting Value TM Founded in 1942 as Crowe Chizek, Crowe has been providing auditing services for over 74 years. Headquartered in Chicago, Illinois, Crowe is a global firm with locations across the U.S. Approximately 3,500 personnel Crowe ranks as the 8 th largest U.S. public accounting and consulting firm (based on U.S. net revenue) according to the 2017 Accounting Today Top 100 Firms List. Over 400 California public sector projects, including more than 100 CalSTRS contributing entities Four offices and more than 300 personnel in California Commitment to providing deep expertise and experience to maximize client service regardless of geographical location Over 500 public sector audit clients nationwide 3

4 Crowe Horwath LLP: Building Lasting Value TM 4

5 Our Message Alignment of Core Values Deep Industry Expertise Strength of Engagement Team Commitment to Relationship Audit Quality Exceptional Client Service 5

6 The Crowe Vision Deep Specialization Commitment to the Public Sector One Crowe Approach Technology-Driven Solutions CiRT Exceptional Client Experience Commitment to a high level of professional audit quality Assurance Professional Practice Annual Internal File Inspection Triennial External Peer Review Annual PCAOB Inspection Our vision is built on deep specialization, which allows us to deliver value to our clients and people. James Powers Chief Executive Officer Crowe Horwath LLP 6

7 Strength of Crowe s Team 7

8 Reputation & Audit Quality Leadership/Participation in professional standards organizations and regulatory organizations AICPA national ethics committee Ethics committees in relevant states AICPA State and Local Government Expert Panel AICPA Employee Benefit Plan Audit Quality Executive Committee Advisory Partner to the Sustainability Accounting Standards Board (SASB) CPE Advisory Committee American Association of Government Accountants Government Finance Officers Association Public Pension Financial Forum Center for Audit Quality 8

9 How is Crowe Different? Independence and objectivity Effective communication and understanding of the issues Institutional knowledge of CalSTRS Delivering quality and timely audits Aligning deep expertise to CalSTRS org structure 9

10 Our Audit Timing & Approach Acting with PROFESSIONAL SKEPTICISM, INDEPENDENCE, and OBJECTIVITY at all times Audit process managed in phases Issuing reports / deliverables by end of September Findings to the ARM Committee in November 10

11 Our Audit Timeline October 2017 March 2018 Planning End of September 2018 Report Issuance December 2017 September 2018 Execution November 2018 Audits and Risk Management Committee Presentation 11

12 Audit Methodology Phase 1 Audit Strategy Development Phase 2 Account Level Controls Assessment and Testing Phase 3 Perform Audit Procedures Phase 4 Completion, Accumulation of Results and Reporting 12

13 Audit Focus Internal Controls Financially Significant Systems Laws & Regulations Investments Contributions Benefits Paid Total Pension Liability Other Pension Information Other Postemployment Benefit Information 13

14 During the current Contract, Crowe has delivered objective, independent services to CalSTRS Identification of risks, deficiencies and areas for improvement Collaboration on areas of focus and continuous improvement 14

15 How CalSTRS has responded CalSTRS culture has embraced the importance of internal controls CalSTRS has significantly improved its financial reporting cycle CalSTRS successfully implemented Business Direct CalSTRS successfully implemented GASB 67 and was the first public employees retirement system to assist employers with the adoption of GASB

16 Why CalSTRS should choose Crowe Horwath LLP 16

17 Crowe s Value Proposition Six years (plus) of experience performing CalSTRS external audits Proven track record of high quality deliverables on time Familiarity with CalSTRS Financially significant systems Organizational structure Managing expectations and effective communication Teachers Retirement Law Implementation of new pension solution 17

18 Crowe s Value Proposition Improvement in employer reporting and accuracy of active member data due to employer audits (400+) Exceptional client experience Involvement of senior level resources through all phases of the engagement Crowe knows what is takes Deep functional competency and industry specialization Options to effectively address Audit Partner rotation 18

19 Crowe s Reputation & Credentials Demonstrated capability and expertise on time, quality delivery Recognizing your role as stewards of CalSTRS and future generations Financial reporting excellence and integrity Delivering excellence in everything we do 19

20 Thank you In accordance with applicable professional standards, some firm services may not be available to attest clients. This material is for informational purposes only and should not be construed as financial or legal advice. Please seek guidance specific to your organization from qualified advisers in your jurisdiction., an independent member of Crowe Horwath International crowehorwath.com/disclosure 20