The Florida Retirement System continues to be fully funded. The 2002 actuarial valuation determined that the system's assets continued to exceed its liabilities, with a surplus of $12.936 billion as of July 1, 2002. However, the 2002 actuarial valuation also shows that the growth rate in the system's ratio of assets to liabilities has leveled off and begun a downward trend. The system's ratio of assets to liabilities was 118.09% in Fiscal Year 1999-00, 117.93% in Fiscal Year 2000-01, and 114.96% in Fiscal Year 2001-02.

Buck Consultants, Inc., concluded that the 2002 valuation recommended reasonable contribution rates and was made in accordance with relevant state laws and rules, and actuarial standards. It further concluded that the assumptions and methods used in the 2002 valuation were generally reasonable.

However, it also made several technical recommendations.

• Although improvements have been made since the 2001 valuation, the department's consulting actuary should include a more detailed analysis of the causes of gains and losses to the system's liabilities. This would enable an outside actuary to better assess the factors causing recent gains and losses.
• Retirement rate assumptions should be monitored for appropriateness, especially for younger system members.