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Media Advisory: Nov. 21, 2008
BWC Receives Clean Financial Audit, Updates Board of Directors on Investment Portfolio
COLUMBUS – A financial audit of the Ohio Bureau of Workers’ Compensation (BWC) released yesterday by
the Auditor of State reports no material findings. BWC updated the Board of Directors today on the audit,
and provided another report on the agency’s investments and performance of its portfolio during the recent
challenges to the investment markets.
The annual financial audit of BWC included a review of financial statements and an internal control
audit. BWC financial statements received an unqualified opinion; the internal control audit found no
instances of non-compliance and no material weaknesses.
“BWC has instituted significant changes in policies and procedures to restore public trust and bring
efficiency back to Ohio’s workers’ compensation system,” said BWC Administrator Marsha Ryan. “For more
than a year, our professional Board of Directors has played an important role in guiding the establishment
of these policies, which are resulting in dramatically improved operational performance, as well as
increased transparency and accountability.”
BWC also led a discussion with board members about the standing of BWC investments. Unaudited figures for
all BWC invested funds combined currently stand at approximately $15.5 billion, and the estimated
unaudited portfolio return for the calendar year to date is approximately -13%. The relatively
conservative investment portfolio is currently comprised of approximately 86-percent bonds and 12-percent
equities.
“Our conservative portfolio and long-term investment strategy mitigate risk and allow us to respond to
economic shifts,” said Ryan. “Our investment professionals maintain close watch on the markets each day
and are doing an excellent job of minimizing the impact of the volatile market as much as possible. We’ve
also been updating our constituencies regularly on the strength of our investments and the ample level of
reserves that allow BWC to continue taking care of Ohio’s injured workers without disruption.”
The board also approved rule changes to set rates for each industry group within Ohio’s Public Employer
Taxing Districts (PECs). In October, the board approved a five-percent decrease in premium rates for PECs,
which represent approximately 3,900 Ohio cities, counties, townships, villages, schools and special districts.
Rates for individual PEC entities differ based on their own claims history. Some will see slight increases
while others will see decreases, but the total overall change will be a decrease of five percent from
the current year. The decrease follows a five-percent overall rate decrease for private employers and
a 10-percent overall rate decrease for Ohio state agencies, universities and university hospitals.
In other business, the board adopted governance guidelines as recommended by its Governance Committee.
Governance guidelines are updated annually and identify the Board’s purpose, composition, responsibilities
and procedures. The governance guidelines serve as an important tool for the board in executing it’s duties
on behalf of Ohio’s workers’ compensation system. Separately, each of the board’s four committees adopted
committee charters, outlining their purpose and responsibilities. The actuarial, audit, investment and
governance committees oversee the board’s operations.
The next Board of Directors meeting will be Thursday, December 18 in Room 3, Level 2 of the William Green
Building, located at 30 W. Spring St., Columbus.
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Maria Smith
614-728-8045 or 614-205-5709
mariasmith@bwc.state.oh.us
Melissa Vince
614-466-2956 or 614-202-2329
melissa.vince@bwc.state.oh.us
Ohio Bureau of Workers’ Compensation Board of Directors
Chairman William Lhota, SI Employers | Charles Bryan, Actuary | David Caldwell, Employee
Organizations | Alison Falls, Investment & Securities | Thomas Pitts, Employees | Kenneth
Haffey, CPA | James Harris, Employee Organizations | James Hummel, Large Employers | Jim
Matesich, Small Employers | Larry Price, Public | Robert Smith, Investment & Securities
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