News: 2003 03 March

In December 2002, the Pension and Welfare Funds of the Retail, Wholesale and Department Store Union ("RWDSU") retained IFS as their retainer investment consultant. The Funds total approximately $370 million in asset value.

The International Brotherhood of Teamsters recently hired IFS to evaluate and advise it regarding certain aspects of the investment program of the Central States Pension Fund. IFS is addressing the "asset side" of the program and Watson Wyatt is addressing the "liability side."

In mid October 2002, the Office of the Treasurer of New Jersey announced the selection of IFS to perform an Operational Review of the State's Division of Investments. The Division is responsible for internal asset management of the State's approximately $60 billion in public pension fund assets. The study will evaluate how the New Jersey Division of Investments compares to best practices in terms of its overall investment organization and program.

In March 2003, the Pennsylvania Public School Employees Retirement System and the Pennsylvania State Employees Retirement System - with combined assets approximating $50 billion - selected IFS to evaluate their respective investment programs and practices. The two projects will proceed in tandem and are expected to be completed in early 2004.

In December 2002, IFS presented its final report to the Board of Trustees of the New Hampshire Retirement System regarding various aspects of that System's day-to-day operations and investment program. This Operational Review examined 12 different task areas. We compared the New Hampshire System's investment practices, policies, staffing and internal controls to "best practices" and recommended many specific adjustments, designed to facilitate its operating processes, enhance risk management and improve the organization.

In late 2000, after months of study, IFS recommended to the Iowa Governor's Task Force on Structure and Governance significant changes to the Iowa Public Employees' Retirement System, including establishing it as an entity distinct from the State's Department of Personnel. In December 2002, Iowa's Governor Vilsack announced the selection of the System's first executive director, replacing the Department of Personnel's Director as the System's chief executive.

In March 2003, IFS completed and presented its full-blown Operational Review of the investment program and practices of the $11 billion Alaska State Pension Investment Board.

During the first quarter of 2003, IFS completed its Operational Review of the investment program of the Apogent Retirement Security Plan. Apogent is a publicly-traded company, based in Portsmouth New Hampshire.

FundFire.com, the on-line journal regarding institutional investing, recently previewed consultants' expectations for 2003, including those of IFS. "Managers to See Change in '03" was reported in the December 24 edition.

Pensions & Investments carried a major story in its March 3 issue (page 3) on the continuing trend among pension funds towards Operational Reviews, aka "fiduciary audits."

The Governmental Pension Fund of Thailand - with assets of approximately $4 billion (U.S.) and over 1 million members - is the country's largest retirement system and represents roughly 10% of the value of the entire Stock Exchange of Thailand. Seeking to institute "global best practices" at its own organization as well as influence the country's larger financial services sector, the Fund's Board and upper management convened a conference on "World Class Fiduciary Practices" in September 2002. The two leading speakers were Samuel (Skip) Halpern of IFS - who spoke on "Fiduciary Responsibilities in Investing" - and Dr. William Crist, then President of CalPERS - on Corporate Governance. Mr. Halpern also conferred with the GPF Board and upper and mid-level staff regarding their investment program and practices.

IFS hired a new junior analyst in its Washington, D.C. office. Stacy Sullivan comes to us from Cambridge Associates where she has been responsible for performance measurement and portfolio analysis for approximately two years.

IFS has hired on a full-time basis two other senior personnel who had previously worked on a part-time basis.

Steven Harding - a CPA and formerly Internal Auditor for the New York State Comptroller's oversight of the New York Common Retirement Fund - will continue concentrating on the firm's Operational Review work.

Peter Giammarinaro - a CPA, CMA and CFP comes to IFS with broad business experience, most recently as International Controller with Bowne Global Solutions - will serve as the firm's Controller, continuing his focus on the firm's internal finances and administration. Both Steve and Peter are based in our Newark, New Jersey office. This brings the firm's total number of employees to 25.