05 Audit for FY01-02 - Laserfiche WebLink

Home Browse Search

City of Paris, Texas -- Notes to Financial St&te~ents (Continued) September 30, 2002 IV. Other Information (Continued) F. Risk Management (Continued) estimated historical cost information of the amounts needed to pay prior and current-year claims and to establish a reserve for catastrophe losses. The claims liability is based on the requirements of Governmental Accounting Standards Board Statement NO. 10, which requires that a liability for claims be reported if information prior to the issuance of the financial statements indicates that it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss can be reasonably estimated. For the fiscal years ended September 30, 2002 and 2001, changes on unpaid claims liability are as follows: 2002 2001 Balance at Beginning of Year $ 259,149 $ 307,718 Claims Incurred During the Year 2,273,150 1,638,262 Payments on Claims (2,230,676) (1,686,831) Balance at End of Year $ 301,623 $ 259,149 G. Employee Retirement Systems and Plans The City maintains a non-traditional defined benefit retirement plan for all full-time employees except for firefighters and a single-employer, defined benefit plan for firefighters. 1. Texas Municipal Retirement System Plan Description Provisions The City provides pension benefits for all of its full-time employees (except firefighters) through a non-traditional, joint contributory, hybrid defined benefit plan in the state-wide Texas Municipal Retirement System (TMRS), one of 758 administered by TMRS, an agent multiple-employer public employee retirement system. Benefits depend upon the sum of the employee's contributions to the plan, with interest, and the City-financed monetary credits, with interest. At the date the plan began, the City granted monetary credits for service rendered before the plan began of theoretical amount equal to two times what would have been contributed by the employee, with interest, prior to establishment of the plan. Monetary credits for service since the plan began are 150% of the employee's accumulated contributions. In addition, the City can grant, as often as annually, another type of monetary credit referred to as an updated service credit which is a theoretical amount which, when added to the employee's accumulated contributions and the monetary credits for service since the plan began, would be the total monetary credits and employee contributions accumulated, with interest, if the current employee contribution rate and City matching percent had always been in existence and if the employee's salary had always