FRANKFORT, KY (KFVS) - The Kentucky State Auditor has released the results on the audit of the Kentucky Retirement Systems (KRS) for Fiscal year 2018.
In the report, Auditor Mike Harmon says there are three areas in need of improvement by KRS.
Those areas outlined in the audit are the following: over-payment by employers to KRS, lack of policies when it comes to the waving of penalties for delinquent payments, and the preparation of financial statements.
According to Auditor Harmon’s report, employers overpaid KRS $2.37 million because the system reportedly did not properly monitor or resolve over-payments on employer invoices.
The report details that the over-payments occurred between Fiscal Years 2012 and 2014.
The audit also shows that employees who overpaid the system were not aware of the mistake.
In the second finding, the audit showed 95 employers had their delinquent penalty payments waived. This amount totaled more than $104,000. It’s unknown if auditors have the power to legally waive late penalties since this process is not reported to the KRS board. Auditors say there are no polices on what qualifies for late payment waivers.
Auditor Harmon says the third area that needs to be addressed by the KRS is the preparation of financial statements. He reports that the system is not following generally accepted accounting principles.
The completion of the audit is not the final step by Harmon’s office.
The financial statement audit of KRS is done every five years as required by law.
To view the full report by the Kentucky State Auditor’s Office click here.