Amendment+1+-+PERS+RIO+-+2025-2027.pdf

STATE OF NORTH DAKOTA

OFFICE OF THE STATE AUDITOR

600 E BOULEVARD DEPT 117

BISMARCK, ND 58505

SOLICITATION AMENDMENT #1

April 4, 2025

Solicitation Number: 117-25-04 Title: 2025, 2026, and 2027 Financial Statement Audits – PERS & RIO

Deadline for Receipt of Proposals: April 23, 2025, by 5PM CT Solicitation Issued: March 19, 2025

Section #1.4, RFP Schedule established a Deadline for Submission of Questions and Requests for Clarification. The responses, including any necessary amendments are as follows:

Questions: Responses:

Is UHY LLP invited to participate in this solicitation?

Yes

What improvements would you like to see in the audit process?

NDPERS – we don’t have concerns with the audit process. Overall, we had a solid timeline of expectations from both parties, and we were able to meet these objectives successfully.

RIO – None

For census data testing, approximately how many employers are in scope in a single fiscal year for the following plans:

- North Dakota Teachers Fund for Retirement

- North Dakota Public Employees Retirements System

- ND PERS – Retiree Health Insurance Credit Fund

NDPERS:

Main – 24,875 actives, 14,119 retirees, and 17,898 deferred members.

Judges – 58 actives, 44 retires, 4 deferred

Public Safety – 1,776 actives, 177 retirees, and 821 deferred

Highway Patrol – 165 actives, 119 retirees, 57 deferred

Job Service – 1 active, 109 retirees, 0 deferred

RHIC – 15,853 active, 14,131 retiree, and 14,835 deferred

North Dakota Teachers Fund for Retirement currently has 204 employers

For RIO, approximately how many investment positions are held subject to fair value leveling disclosure?

15,000

For RIO, approximately how many investment funds are subject to NAV measurement?

For NDPERS, approximately how many mutual fund positions are held in the defined contribution retirement fund and deferred compensation plan?

There is a target date series, 3 passive core funds, 7 active core funds, and one real estate fund that our Board has fiduciary oversight of.

For NDPERS, approximately how many commingled domestic fixed income investment positions are held by the Uniform Group Insurance Program?

This is not applicable to NDPERS, but RIO has:

Approximately 750 positions

For NDPERS, approximately how many investments subject to NAV measurement are held in the Retiree Health Insurance Credit Fund and Retirement Plan for Employees of Job Services North Dakota?

This is not applicable to NDPERS, but RIO has:

Approximately 10 for JOB Service Approximately 5 for Job Service

Approximately how many hours does UHY dedicate to RIO and NDPERS?

The proposal from 2024 had 900 hours to each of PERS and RIO.

Were there any issues with the current auditor? No Issues

Were there any adjustments proposed by the auditors for FY 2024 or FY 2023?

No

When did the interim fieldwork occur? How many auditors were out in the field during final fieldwork? For how many days?

NDPERS:

Interim fieldwork typically begins late May/early June for the July – March timeframe. We had 2-3 auditors on site for one week, and the rest of the work was done remotely.

RIO:

Interim field work the most previous fiscal year happened in June but has happened as early as may in previous years. 2 auditors were out for final fieldwork for 5 days.

Were there any major audit issues identified for 2024? Any anticipated ones for 2025?

No audit issues in 2024 and none anticipated for 2025

What part of the audit process would NDPERS and RIO like to improve over the past audits?

None

If a new auditor is awarded the contract, what transition issues would be of concern?

NDPERS – just the breadth of benefits and services that our office administers. In addition to numerous pensions plans, our office administers a 457 plan, 401(a) Defined Contribution plan, Flex Compensation program, and a wide array of insurance programs (health, EAP, dental, vision. Life, vision)

RIO:

No concerns.

What controls are in place to monitor and record calls and distributions for real estate and private equity investments?

All calls and distributions for real estate and private equity investments require 2 people to process. All notifications are received in our info email and then it takes 2 people to input the call/distribution and one to approve it. We also have an external consultant how monitors our private market accounts.

What reconciliation procedures are performed between the different investment managers and custodian and how often?

NDPERS:

We balance to RIO’s statements monthly, as well as our 457 and 401(a) Defined Contribution providers.

RIO:

We reconcile our investment managers to our custodian on a monthly basis.

Are there going to be any changes to the system that would significantly change its investment vehicles or benefits provided? If so, what are they?

NDPERS:

No

RIO:

We just launched our internal investment initiative on 4/1/25. This allows us to internally invest a portion of the portfolio instead of all external manager, which we have previously done.

How long does each entity keep their books open for any true up of fair value of the alternative investments?

NDPERS – we typically receive investment information from RIO in October to book our final entries

RIO:

We plan to close June 30th reporting no later than the end of July.

How many employers were selected for census testing in the prior two (2) years for each cost sharing plan?

NDPERS:

Main – 15 in 2023 and 10 in 2024 Judges – 1 in 2023 and 0 in 2024 Public Safety – 3 in 2023 and 4 in 2024 Highway Patrol – 1 in 2023 and 0 in 2024 Job Service – 1 in 2023 and 0 in 2024

RIO:

22 employers were selected in each FY24 and

FY23

When are GASB 67 and 68 reports available from the actuaries?

RIO:

The GASB 67 and GASB 68 draft reports are due to us on October 15 from the actuaries.

The reports are completed by RIO by the middle of December to be audited.

NDPERS:

Typically, mid-December. We also have GASB 74 and 75 reports for other post-employment benefits as well.

Were there any errors noted in the census testing performed in the prior two (2) years?

No

Is there a preferred timeframe of when the census testing would be performed?

NDPERS:

We would prefer to start the census testing in August to give employers adequate time to compile the requested information and respond to reconciliation differences.

RIO:

No

When are the draft of the financial statements and ACFR available for review by the auditors?

The State’s ACFR is not reviewed by the contracted auditors. The final report for RIO is due to the SAO and RIO by November 15th of each fiscal year. The final report for NDPERS is due to the SAO and NDPERS by November 22nd of each fiscal year.

How soon after year end would auditors be able to begin fieldwork?

As soon as the auditor is available

Questions regarding this amendment must be submitted in writing to the Procurement Officer.

James Carroll Procurement Officer E-mail: jpcarroll@nd.gov Telephone: 701-328-2278 TTY Users call: 7-1-1