California teachers' retirement accounts could face further audits

In a recent announcement, the California Controller has indicated his office is broadening a review of public employee retirement accounts. He stated that his office needed further time to complete the audits so they can review all the targeted accounts. These retirement accounts are of state employees who have allegedly been receiving unauthorized raises as they approach retirement age, which has increased their benefit payments.

The audit was originally commenced in Nov. 2011. It was initially believed the full audit would take about 2 months. However, the Controller has determined that, due to the allegations that employees were receiving inflated payments, that more time would be needed.

It has been reported that the state of California has been unable to cover all of the expenses associated with pensions, and that the amount covered dropped from 75 percent in 2010 to 69 percent in 2011. These costs have caused the price of hiring employees in the state to rise significantly. As a result, California Governor Jerry Brown has proposed several laws that would work to ensure that the retirement payments reflect a more accurate representation of employees' wages at the end of their employment career.

Audits of California financial accounts are a common occurrence. These reviews are a mechanism through which government and private agencies can ensure that the proper compensation and financial reporting is being conducted. Although these audits can be taxiing on a business or organization, they do not need to be as stressful as they might originally appear to be. By enacting a plan on how to organize the financial documents so that the audit can be accomplished as efficiently as possible, businesses and individuals can ensure that the time and expenses associated with the audit are minimized, all while ensuring a fair and accurate accounting takes place.

Source: Bloomberg, "California Widens Audit of Pension Abuse, Controller Says," James Nash, Aug. 24, 2012

No Comments

Leave a comment
Comment Information

Contact the Law Office of Williams & Associates

For more information about our tax law services, or to discuss your tax matter, call our Sacramento office at (916) 488-8501 or toll free at (800) 684-7147. You may also send us an inquiry via email.

Contact the Firm

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Office Location:

3600 American River Drive, Suite 135
Sacramento, CA 95864

Toll Free: 800-684-7147
Phone: 916-488-8501
Fax: 916-488-8196
Sacramento Law Office Map