§ 45-21-43. Accounts and records — Reserve accounts.
(a) An adequate system of accounts and records is established and maintained for the system
that fully reflects the requirements of this chapter. All assets of the system are
credited according to the purposes for which they are held in the following designated
reserve accounts:
(1) Members' contribution reserve.
(i) The amounts contributed by the members are credited to this reserve. An individual
account is maintained for each member. Member contributions made pursuant to § 45-21-41.1 are credited to a separate fund within a member's individual account so that the
amounts contributed prior to the effective date for the pickup of member contributions
may be distinguished from the amount contributed on or after the date on which the
municipality begins to pick up member contributions.
(ii) Upon the granting of a retirement allowance, the total accumulated contributions of
the member concerned are transferred from this reserve to the retirement reserve.
Refunds and death benefit payments representing members' contributions are charged
to this reserve.
(2) Employer's accumulation reserve.
(i) The amounts contributed by the municipalities for the various purposes of this section
are credited to this reserve. Upon the granting of a retirement allowance, annuity,
or benefit, an amount representing the excess of the actuarial value over the total
contributions of the member is transferred from this reserve to the retirement reserve.
That portion of the death benefit provided from municipality contributions is charged
to this reserve.
(ii) Upon request by a municipality, to transfer monies from this reserve to any one or
more of the municipality's other retirement units within the municipal employee retirement
system which has unfunded liability, the retirement board shall request a private
letter ruling from the Internal Revenue Service and upon receipt of a favorable ruling,
shall transfer the funds consistent with the private letter ruling.
(3) Retirement reserve. Upon the granting of a retirement allowance, the accumulated contributions of the
member and an amount representing the excess of the actuarial value of the allowance
over the accumulated contributions, are transferred to this reserve from the members'
contribution reserve and the employer's accumulation reserve, respectively.
(b) All payments on account of any retirement allowance or any benefit to a beneficiary
of a member are charged to this reserve.
(c) Any excess amount in this reserve, over the actuarial liabilities of the reserve,
as determined by actuarial valuation, is transferred at the close of each year to
the employer's accumulation reserve to be used to reduce the municipality's contribution
upon a rate redetermination as established by the periodic actuarial valuation provided
in this section. Any deficiency in this reserve is removed by a transfer from the
employer's accumulation reserve.
(d) All income from investments, including gains from investment transactions, is credited
to this reserve. All losses on investments are charged to this reserve.