Roles and Responsibilities
A number of parties are responsible for ensuring that the Pension Fund is maintained in a financially sound way that will provide pension earnings for members over the long term. They include:
Board of Trustees
The Board of Trustees has overall responsibility for the Pension Fund, including supervision of the administration services provider, the investment managers and others. The Board is also responsible for the approval of the annual audited financial statements. The Board is made up of:
- four trustees elected by Local Union 488,
- three independent trustees nominated by a Nominating Committee consisting of a representative of the CLRa and the Local Union 488’s Business Manager. One of the independent trustees is the independent chairman. The recommendations of the Nominating Committee must be approved by the Board of Trustees.
A 2/3rds majority is required for the approval of any resolutions of the Board of Trustees. The duties and responsibilities of the Trustees are set out in the Pension Trust Agreement and the Health and Welfare Trust Agreement.
The Board’s Audit Committee meets with the administration services provider and the external auditors to review the financial statements and examine other auditing and accounting matters. The committee examines the quality of the financial statement disclosure, the accounting principles applied and any significant judgments affecting the financial statements. The audited financial statements in this report have been approved by the Audit Committee and the Board of Trustees.
Administration Services Provider
The administration services provider operates the Pension Fund and Pension Plan day-to-day, and is responsible for preparing financial statements, in accordance with the accounting principles generally accepted in Canada. The administration services provider develops and maintains high-quality systems for internal accounting and administrative control. These systems are designed to provide reasonable assurance that transactions are properly authorized, reliable financial records are maintained, financial information is accurate and reliable, and assets are appropriately accounted for and adequately safeguarded.
The actuary is appointed by the Board of Trustees and carries out an annual valuation of the Pension Plan’s actuarial liabilities in accordance with accepted principles. This process involves analyzing the benefits to be provided under the Pension Plan, including any increases to benefits. The actuary uses assumptions about future economic conditions (such as inflation and investment return), demographic factors (such as mortality rates and retirement age) and other factors.
The external auditors are also appointed by the Board of Trustees. Their responsibility, the scope of their examination and their opinion is set out in the Auditors’ Report. The external auditors have full and unrestricted access to staff of the administration services provider and the Audit Committee to discuss any findings related to the integrity of the financial reporting and the adequacy of internal control systems on which they rely for the purposes of their audit. The external auditors rely on the work of the actuary for the actuarial liabilities disclosed in the notes to the financial statements.
The custodian holds the Pension Fund’s assets and executes trades under the direction of the Pension Fund’s investment managers. The custodian is appointed by the Board of Trustees.
The investment managers each direct a portfolio of assets on behalf of the Pension Fund, within guidelines set by the Board of Trustees through the Statement of Investment Policy and Procedures. The investment managers are appointed by the Board of Trustees.