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Annual Report 2004

TO RETIREMENT ASSOCIATION MEMBERS

I am pleased to provide you with the Annual Report of the Stanislaus County Employees Retirement Association (StanCERA) for the fiscal year ended June 30, 2004.

StanCERA remains very healthy despite several years of down financial markets. Investments for the year returned 16.4% and outperformed the policy benchmark by 1%. Total asset of the fund were $1.104 billion.  Current year earnings in excess of the actuarial assumed rate (4% posted semi-annually, or 8.16% per year) were used to reduce the undistributed losses from prior years.

Interest of .125% semi-annually was credited to all members\' accounts.  Despite the lower than expected returns for two of the past three years, StanCERA expects an 8% average annual return over the long term.

The fund provided $48 million is retirement benefits during the year consisting of $41 million in regular retirement benefits and $7 million in supplemental, non-vested benefits. The supplemental benefits provided a substantial offset for the cost of health insurance for our retired members and their beneficiaries during the year. Administrative expenses amounted to $1.3 million or .11% of assets.

StanCERA\'s independent auditor, Brown Armstrong, has audited the financial statements and provided an opinion that the financial statements present fairly, in all material respects, the financial position of StanCERA for the years ended June 30, 2004 and 2003, and the results of its operations for the years then ended in accordance with generally accepted accounting principals. A complete Comprehensive Annual Financial Report (CAFR) can be located on StanCERA\'s website: www.stancera.org.

Sincerely,

Tom Watson, Acting Retirement Administrator
Stanislaus County Employees\' Retirement Association

INVESTMENTS
BONDS
MARKET VALUE
U.S. Government
$252,945,362
Corporate Bonds
$128,826,229
TOTAL BONDS
$381,771,591
 STOCKS  
Technology
$96,406,148
Capital Goods & Services
$10,827,389
Energy
$23,391,375
Materials & Services
$137,063,688
Consumer
$100,562,745
Financial
$63,831,893
Transportation
$16,357,572
Utilities
$29,779,645
S&P 500
$56,783,592
Real Estate Stock

$594,887

Miscellaneous Common Stock
$1,334,308
   
Total Domestic Stocks
International (Putnam)
TOTAL STOCKS
$536,933,242
$163,111,177
$700,044,419


STATEMENT OF PLAN NET ASSETS JUNE 30, 2004


   
FAIR VALUE
 
 
 
DEFINED BENEFIT PENSION PLAN
POST EMPLOYMENT HEALTH BENEFIT
 
 
TOTAL      
       
ASSETS      
Cash and Cash Equivalents
$  30,038,545
$  2,924,869
$  32,963,414
       
RECEIVABLES:      
Interest & Dividends
   2,762,060
   268,944
  3,031,004
Securities Transactions
3,798,090
369,823
4,167,913
Contributions
1,665,515
162,173
1,827,688
 
TOTAL RECEIVABLES
8,225,665
800,940
9,026,605
       
FIXED ASSETS:      
Capitalized Software

440,501

--

440,501

       
INVESTMENTS
(At Fair Value):
     
Bonds
348,529,175
33,242,416
381,771,591
Stocks
639,088,686
60,955,733
700,044,419
Real Estate

2,477,403

--

2,477,403

Collateral on Loaned Securities
146,657,871
--
146,657,871
       
TOTAL Investments
Total Assets
1,136,753,135
$1,175,457,846
94,198,149
$97,923,958
1,230,951,284
$1,273,381,804

LIABILITIES
PAYABLES:

Accrued Expenses

--

--

--

Accounts Payable
Collateral on Loaned
Securities

TOTAL PAYABLES

23,116,371
146,657,871

169,774,242

              --               --

       --

23,116,371
146,657,871

169,774,242

NET ASSETS HELD IN TRUST FOR BENEFITS.
$1,005,683,604
$97,923,958
$1,103,607,562

 

STATEMENT OF CHANGES IN PLAN NET ASSETS FOR THE YEAR ENDED JUNE 30, 2004

   
Fair Value
 
 
DEFINED
BENEFIT
PENSION
       PLAN      
POST
EMPLOYMENT
HEALTH
   BENEFITS  
      TOTAL     
Additions:      
Contributions:
Employer
 
$17,113,973
 
$      ---

$17,113,973

Plan members
$18,941,508
    _______---
$18,941,508
Total contributions
$36,055,481
     ______ ---
$36,055,481
Investment Income (Loss)      
Net appreciation (depreciation)in fair value of assets

$131,310,915

 ---

$131,310,915
Interest & Dividends
$26,276,509
---
$26,276,509
Total Investment Income (Loss)
$157,587,424
               ---
$157,587,424
Less Investment Expenses

(2,847,706)

 
(2,847,706)
Net Investment Income (Loss)
154,739,718
 
154,739,718

Securities Lending Activities

Securities Lending Income
Less Securities Lending Expense
Net Securities Lending Income

$2,428,825
(2,013,166)
415,659

$           --  
$           --  

$           --  

$2,428,825
(2,013,166)
415,659

Miscellaneous Income
114,058
       -
114,058
  Total Additions
191,324,916

 

       ---
191,324,916

 

Deductions:  

 

 
Benefits Payments
$40,999,778
$       -     
$40,999,778
Insurance Stubsidies
       -     
6,926,401
6,926,401
Member Refunds
1,326,769
       -     
1,326,769
Administrative expenses
1,194,775
106,562
1,301,337
Other
       -     
       -     
       -     
Total Deductions
$39,591,389
$6,552,496
$46,143,885

 

 
 
 
Net increase (decrease)
$147,803,594
(7,032,963)
$140,770,631
Transfer of plan assets
(106,563)

106,563

       ---
       

Net assets held in trust for pension and health benefits: (at market value)

Beginning of year

End of year - market value

 
 
 
 
 
$857,986,573

$1,005,683,604

 

 

$104,850,359

$97,923,958

 
 
 
 
 
$962,836,932

$1,103,607,562