2014 Annual Report

2014 Annual Report
Please feel free to contact us for additional information.
Public Agency Risk Sharing Authority of California
1525 Response Road, Suite 1
Sacramento, California 95815
(800) 400-2642 • www.parsac.org
Accredited with Excellence
Since 1996

2
Our guiding values include
a committment to build and
maintain positive relationships
through open communication,
mutual respect, and trust.
To the Board of Directors,
Once again, it has been a privilege to serve as the President of PARSAC. This was made possible by
the contributions of so many people who are intentional about ensuring that public service remains
a pleasure and not a burden. Indeed, working alongside such a tremendous staff, dedicated and
supportive officers, and the entire Board of Directors from throughout the State of California, it
remains clear that PARSAC is well positioned to proceed into the next fiscal year with great success.
I want to use this opportunity to share my appreciation to each of the members who took an active
role in committee assignments. The committees provide a valuable venue to learn about the details
of the operations; dig deeper into the heart and character of the organization; and develop strong
working relationships that benefit the pool and member agencies alike.
It appears that PARSAC has weathered the fiscal storm faced by our nation, state and individual
communities over the past five years. This was accomplished by reducing expenses and closely
evaluating actuarial assumptions to minimize exposure to the pool, while not crippling our members
financially. This was painful at times, but necessary, as we continue to be committed to fiscal
responsibility.
It used to be that employers could defend highly questionable claims and prevail. As we all know, laws
have been passed over the years, sometimes favorable to the employer, but most often resulted in
cyclical increases in costs. As workers’ compensation costs continue to rise, we must be intentional
about mitigation efforts. As a result, employers must dust off and reconsider their Illness and Injury
Prevention Programs and safety training. The benefit delivery system, which used to be fairly straight
forward, has become increasingly complex. Fortunately, PARSAC members have been able to adapt
and benefit from these changes simply by sharing their experiences and information amongst the
organization.
What we do here matters and it takes the collective interaction of all to ensure we remain the JPA of
choice. Thank you and we look forward to another great year.
Greg Franklin, President
City of Yucaipa
Engaged Members

Public Agency Risk Sharing Authority of California 3
Board of Directors
2013-2014
ALTURAS Heather MacDonnell
Modoc Kenneth Barnes
AMADOR CITY Aaron Brusatori
Amador Janet Spencer
AVALON Betty Jo Garcia *
Los Angeles Michael Krug
BLUE LAKE Adrienne Nielsen
Humboldt John Berchtold *
CALIFORNIA CITY William “Tom” Weil
Kern
CALIMESA Randy Anstine
Riverside Darlene Gerdes
COALINGA Richard Spitler
Napa Gloria Leon
CITRUS HEIGHTS Ronda Rivera †*
Sacramento Amy Van
CLEARLAKE Melissa Swanson †*
Lake Joan Phillipe
COALINGA Rene Ramirez
Fresno Mercedes Garcia
FERNDALE Jay Parrish
Humboldt Deb Austrus
GRASS VALLEY Tim Kiser
Nevada Jeffrey Foltz
HIGHLAND Sam Racadio †
San Bernardino Chuck Dantuono *
MENIFEE Terri Willoughby *
Riverside Robert Johnson
NEVADA CITY Catrina Olson *
Nevada Corey Shaver
PACIFIC GROVE Thomas Frutchey
Monterey Cathy Krysyna
PLACENTIA Troy Butzlaff
Orange Eddie De La Torre
PLACERVILLE Cleve Morris †
El Dorado Dave Warren *
PLYMOUTH Gloria Stoddard
Amador Jeff Gardner
POINT ARENA Hunter Alexander *
Mendocino
RANCHO CUCAMONGA John Gillison †*
San Bernardino Chris Paxton
RANCHO SANTA MARGARITA Mark Taylor*
Orange
RIALTO George Harris *
San Bernardino Paula Mohan
SAN JUAN BAUTISTA Trish Paetz
San Benito Roger Grimsley
SOUTH LAKE TAHOE Janet Emmett *
El Dorado
TEHAMA Carolyn Steffan †*
Tehama Betty Celano
TRINIDAD Gabriel Adams
Humboldt Karen Suiker
TRUCKEE Kim Szczurek
Nevada Chrissy Earnhardt
TWENTYNINE PALMS Ron Peck †*
San Bernardino Joe Guzzetta
WATSONVILLE Nathalie Manning
Santa Cruz Tamara Vides
WHEATLAND Stephen Wright †*
Yuba Rex Miller
WILDOMAR Debbie Lee
Riverside Marsha Swanson
YOUNTVILLE Steve Rogers †*
Napa Kathleen Bradbury
YUCAIPA Greg Franklin †*
San Bernardino Raymond Casey
YUCCA VALLEY Debra Breidenbach-Sterling
San Bernardino Curtis Yakimow

† Executive Committee
* Subcommittee Volunteer

4
A year ago we started on a journey to distill the ‘essential’ PARSAC. While the specific task began
over the last year, the journey started twenty-eight years ago with a small group of visionary leaders
faced with a crisis that needed remedy. PARSAC emerged over a quarter of a century later as one of
the industry’s most successful ventures. Our success is not just due to fiscal stability, but also because
of an engaged membership. PARSAC provides opportunities for engagement in governance, finance,
service development, and coverage. It is the members’ willingness to take time out of their busy lives
to volunteer and contribute in these areas that make this organization great.
For nearly three decades, PARSAC has responded to the evolving needs of our members. Whether
those needs arose from cyclical market swings, social and economic environment, or legislative
reforms, we successfully adapted in that dynamic environment and it compeled us to constantly
improve programs and services. Rather than viewing difficult times as problematic, we see them as
opportunities to reflect on a better way to respond and address issues, in an efficient, more focused
approach.
With the support of a progressive Board of Directors and a dedicated team, we accomplished the
following this past year:
• Developed new guidelines for underwriting and rating non-municipal agencies.
• Developed a state of the industry Lifeguard guide policy manual.
• Developed a Global Harmonized System template for classification of hazardous
chemicals.
• Began development of a bicycle pathway design and management guide.
• Initiated a redesign of the PARSAC website.
• Introduced a subrogation recovery program to recover member funds for third party
damage to public property.
• Introduced a Pharmacy Benefit Management program to provide easier, more cost
effective delivery of medication in the workers’ compensation program.
• Amended the investment policy to achieve better diversification of our portfolio and
increase investment earnings.
• Declared over $2 million in dividends to members.
• Received “Accreditation with Excellence” standard from CAJPA continuously since 1996.
We have achieved a great deal together, and I am proud of our accomplishments. We have never
been, and will not be, content with maintaining the status quo. Rather, we will continue to actively
pursue innovative solutions to accomplish our mission and ensure long term growth and stability.
In closing, I want acknowledge the hard work and commitment of the Executive Committee and
Board of Directors without whose support we would not have made such progress. They have placed
incredible faith in staff that will act as a catalyst for future success.
Joanne G. Rennie, ARM SPHR
General Manager’s Message

Unique Individuals
Diverse Needs
Common Purpose
Broad Coverage
Fiscal Stewardship
Engaged Members
Essential
PARSAC

6
Self-Insured Liability Program
PARSAC provides members with a fiscally stable Liability
Program funded at the 85% confidence level. The Program
is self-funded for the first $1 million and an additional
$34 million of excess coverage is provided through a
combination of pooling, excess insurance, and reinsurance.
Employment Practices Liability (EPL) coverage limit is $35
million through the liability program’s excess coverage
with the first $1 million provided by the Employment
Risk Management Association (ERMA).
The pool funding rate for 2013-14 decreased slightly from
$1.18 to $1.16 due to favorable loss development. The
Program remained well funded above the 90% confidence
level; surplus was $11.5 million at expected.
PARSAC believes in proactive claims management.
Members are encouraged to contact PARSAC for
assistance with incidents before they become claims,
which can reduce the cost of the claim. Cases are
assigned to defense panel counsel according to specialty
to produce the best outcome while ensuring cost control.
Self-Insured Workers’ Compensation Program
PARSAC’s Workers’ Compensation Program began
in 1990. The Program delivers timely medical care
and benefits to employees while providing members
with affordable, financially stable coverage. PARSAC
provides quality care through a dedicated claims unit,
nurse advocate, expedited specialist referral, and
access to selected Centers of Excellence facilities. Our
proactive approach helps members to preserve positive
relationships with their employees.
PARSAC self-funds the first $500,000 with statutory
limits provided through a combination of pooling,
reinsurance, and excess insurance. The philosophy of
fiscal stability continues in this Program, which is funded
at the 75% confidence level.
The pool loss funding rate for 2013-14 increased from
$3.85 to $4.26 due to a combination increasing claims
costs and a reduction in the discount factor from 3% to
2.5% to better reflect investment earnings. The Program
remained well funded above the 90% confidence level;
surplus of $11.9 million at expected.
$150k
$200k
$250k
$350k
$500k
$750k
PARSAC Liability
$1 Million
less Member Retention
CSAC-EIA
$4 Million
excess $1 Million
REINSURANCE
Starr Indemnity & Liability
$10 Million excess $15 Million
Catastrosphic Liability Insurance Plan (CLIP)
Great American Excess & Surplus
ERMA EPL
$1 Million
less Member
Retention
$50k
$100k
PARSAC Member Retentions
$50k
$75k
$100k
$250k
PARSAC EPL
$5k
$10k
$25k
$25k
ERMA Member Retentions
REINSURANCE
Ironshore Indemnity
$150k
$250k
$350k
$50k
$100k
$5k
$10k
$25k
EXCESS INSURANCE
National Union Fire Insurance Company (AIG)
Statutory Limits excess $50 Million
REINSURANCE
Ace American Insurance Co.
LAWCX
$4.5 Million
excess $500,000
PARSAC Workers’ Compensation
$500,000
less Member Retention
$0
PARSAC Member Retentions
Programs and Services

Added Value Services
Consultation:
 Litigation Management
 Proactive Incident and Claim Resolution
 Representation at Mediation and Settlement Conferences
 Preserving Governmental Immunities
 Specialist and Resource Referrals
 Legislative and Regulatory Compliance
 Contractual Risk Transfer
Risk Management:
 Safety & Loss Control Grant Program
 On-Site Risk Assessments
 Post-incident Assistance and Mitigation
 Operational Best Practices Policy Templates
 Lexipol Policies and Daily Training for
Law Enforcement & Fire
Training:
 Video and Print Resource Libraries
 Regional and On-Site Training Programs
 Personalized Risk Management Training
 Web-based OSHA compliant Safety Courses
 Web-based Employment Practices Courses
Group Purchased Programs
PEPIP Property Coverage: All-risk, replacement cost coverage
with limits up to $1 billion for all insurable property and autos.
Additional benefits include boiler and machinery up to $100 million;
new property acquisitions up to $25 million; and new autos up to
$10 million. Optional coverages include course of construction,
earthquake, and flood damage.
Special Events: Protects the member from liability by providing
facility users with cost-effective insurance up to a $5 million limit
per occurrence. Participating members receive up to a $1,000 credit
toward their Liability premium.
Bond Program: Up to $1 million per occurrence with a $2,500
deductible for Public Employee Dishonesty; Forgery or Alteration;
Theft, Disappearance and Destruction; and Computer Fraud.
Ancillary Benefits: Optional employee health benefits such as dental,
vision, life, accidental death & dismemberment, and disability coverage
at competitive prices.
Broad Coverage
We exist to serve our
Members and strive
to do so by enhancing
programs to meet
theirchangingneeds.

8
The U.S. economy grew steadily over the past year, fueled by strength in the labor and housing
markets and consumer spending, the largest contributor to Gross Domestic Product (GDP). As a
result, intermediate-term interest rates trended higher; the yield on the two-year U.S. Treasury Note
rose 0.10% to end Fiscal Year 2013/14 at 0.46%, and the 3-year yield rose 0.22% to 0.87%. Yields on
short-term investments remained anchored by the Federal Funds Rate, which has been between
0 – 0.25% since December 2008.
PARSAC’s investment program performed well during the year in the wake of the slow economic
recovery and the increasing global turmoil, maintaining a conservative investment approach that
focuses on safety first, liquidity and then yield. With the expected continued decline in the supply of
Federal Agency bonds and notes over the next several years, PARSAC recently added two new asset
classes to the investment policy: high quality municipal securities and medium-term corporate notes.
These categories now represent 4% and 14% of the portfolio, respectively. The charts below illustrate
the change in portfolio composition from the prior year.
The portfolio has been actively managed by PFM Asset Management LLC, in compliance with
PARSAC’s investment policy objectives. PFM seeks to add value in a variety of ways: duration
management; adjusting maturities along the yield curve; emphasizing sectors that offer the best value;
and careful issue-level analysis and security selection. The portfolio of almost $35 million recorded a
total return of 1.26% during the year, compared with 0.15% for the prior year. Short-term funds are
held by the California State Treasurer’s Office in the Local Agency Investment Fund (LAIF) and earned
an average of 0.24% during the year. PARSAC earned $410,000 in investment income during Fiscal
Year 2013/14, before factoring gains on sales and unrealized market value losses.
While the next year will present many new challenges for PARSAC -- higher interest rates triggered
by widely anticipated Fed action -- we can be confident that our strong financial base will allow us to
continue turning challenges into opportunities. PARSAC’s investments will continue to provide quality
risk protection at a reasonable cost.
Ronda Rivera, Treasurer
City of Citrus Heights
Treasurer’s Report
June 2013
US Treasuries Federal Agencies California Municipal Obligations Medium Term Corporate Notes Money Market Fund LAIF
June 2014
US Treasuries Federal Agencies California Municipal Obligations Medium Term Corporate Notes Money Market Fund LAIF
USTreasuries
Federal Agencies
California Municipal Obligations
MediumTerm Corporate Notes
Money Market Fund
LAIF

Financial Statements
with Supplementary Information
for the years ended
JUNE 30, 2014 AND 2013
including Independent Auditor’s Report
Fiscal Stewardship
Our conservative approach
ensures long term stability,
competitive rates, and
continued protection of
members’ interests.

10
Board of Directors
Sacramento, California
We have audited the accompanying financial statements of the Public Agency Risk Sharing Authority of California
(PARSAC) as of and for the year ended June 30, 2014 and 2013, and the related notes to the financial statements,
which collectively comprise PARSAC’s basic financial statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with
accounting principles generally accepted in the United States ofAmerica;this includes the design,implementation,and
maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free
from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit
in accordance with auditing standards generally accepted in the United States of America, the standards applicable to
financial audits contained in GovernmentAuditing Standards,issued by the Comptroller General of the United States
and the State Controller’s Minimum Audit Requirements for California Special Districts. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free
from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risk of
material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments,
the auditor considers internal control relevant to PARSAC’s preparation and fair presentation of the financial
statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of PARSAC’s internal control. Accordingly, we express no such opinion.
An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant
accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinion.
Opinion
In our opinion,the financial statements referred to above present fairly,in all material respects,the respective financial
position of PARSAC as of June 30, 2014 and 2013, and the respective changes in financial position and cash flows for
the year then ended in accordance with accounting principles generally accepted in the United States of America, as
well as accounting systems prescribed by the State Controller’s office and state regulations governing special districts.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States ofAmerica require that the management’s discussion
and analysis and claims development information on pages 12 through 16 and 35 through 37 be presented to
supplement the basic financial statements. Such information,although not a part of the basic financial statements,
is required by the Governmental Accounting Standards Board, who considers it to be an essential part of
financial reporting for placing the basic financial statements in an appropriate operational,economic,or historical
context. We have applied certain limited procedures to the required supplementary information in accordance
with auditing standards generally accepted in the United States of America, which consisted of inquiries of
INDEPENDENT AUDITOR’S REPORT

management about the methods of preparing the information and comparing the information for consistency
with management’s response to our inquiries, the basic financial statements, and other knowledge we obtained
during our audit of the basic financial statements. We do not express an opinion or provide any assurance on
the information because the limited procedures do not provide us with sufficient evidence to express an opinion
or provide any assurance.
Other Information
Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively
comprise PARSAC’s basic financial statements. The combining statements are presented for purposes of
additional analysis and are not a required part of the basic financial statements.
The combining statements are the responsibility of management and were derived from and relate directly to the
underlying accounting and other records used to prepare the basic financial statements. Such information has been
subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional
procedures, including comparing and reconciling such information directly to the underlying accounting and other
records used to prepare the basic financial statements or to the basic financial statements themselves, and other
additional procedures in accordance with auditing standards generally accepted in the United States of America.
In our opinion, the combining statements are fairly stated in all material respects in relation to the basic financial
statements as a whole.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 23, 2014 on our
consideration of PARSAC’s internal control over financial reporting and on our tests of its compliance with certain
provisions of laws, regulations and contracts and other matters. The purpose of that report is to describe the scope
of our testing of internal control over financial reporting and compliance and the results of that testing, and not to
provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an
audit performed in accordance with Government Auditing Standards in considering PARSAC’s internal control over
financial reporting and compliance.

12
MANAGEMENT’S DISCUSSION AND ANALYSIS
The management of the Public Agency Risk Sharing Authority of California (PARSAC) is pleased to
present the following discussion and analysis of the financial performance for the fiscal year ended
June 30, 2014 to enhance the information included in the following financial report.
Formed in May 1986, the Public Agency Risk Sharing Authority of California, formerly the California
Municipal Insurance Authority (CMIA), is a state-wide joint powers authority. It provides both self-
insured and group purchase coverage to 35 municipalities throughout California. PARSAC operates
self-insured programs for liability and workers’ compensation, and offers insured programs for
property, boiler and machinery, fidelity bonds, special events and employee benefits. Additionally,
PARSAC provides claims administration, loss control and training for members. PARSAC has invested
in a building in Sacramento that houses its administrative office and a conference center that is
available for meetings and training.
The Authority is governed by a Board of Directors comprised of representatives from each member
agency. The Board of Directors elects its officers: President, Vice President, Treasurer, and Auditor/
Controller. The daily operations are administered by the General Manager who serves as the chief
executive officer. The General Manager is responsible for the administration of the policies as set
forth by the Authority’s organizational documents and the Board of Directors.
FINANCIAL HIGHLIGHTS
• Retrospective Premium Adjustments (RPA) of $ 1 million were declared in both programs,
applicable to Liability Program members participating in the 2003/04 to 2008/09 program
years and Workers’ Compensation Program members participating in the 1990/91 to
2005/06 program years.
• The Grant Program concluded its third year, reimbursing members up to $8,151 annually
for loss control services, equipment and training. The Board approved continuing the
program for another three years.
• The Board approved funding at the 85% and 75% confidence levels, maintaining discount
factors of 1.5% and 2.5% in the Liability and Workers’ Compensation Programs,
respectively.
• Two dividends were received from excess providers, CARMA and ERMA; $1.289 million
from CARMA for 2001/02 to 2005/06 program years; $932,000 from ERMA for 2004/05
to 2008/09 years.
OVERVIEW OF THE FINANCIAL STATEMENTS
The Authority operates as an enterprise fund applying the accrual basis of accounting. Individual
program accounting is maintained in-house and is provided as supplemental information to the
financial statements. The Statement of Net Position provides information about the combined financial
position of PARSAC as of the fiscal years noted. The Statement of Revenues, Expenses, and Changes
in Net Position reports the results of operations. The Statement of Cash Flows is presented to
reflect the operations of PARSAC based strictly on the inflow and outflow of cash. The Notes to the
Financial Statements provide information on accounting policies of the Authority, such as development
of claim liabilities, and retrospective premium adjustment.

June 30, 2014 % June 30, 2013 % June 30, 2012 %
Current Assets $ 3,219,416 8% $ 7,161,607 19% $ 6,637,002 17%
Non-Current Assets 34,799,571 90% 29,665,931 79% 30,950,372 80%
Capital Assets 796,811 2% 854,704 2% 910,707 3%
Total Assets $ 38,815,798 100% $ 37,682,242 100% $ 38,498,081 100%
Current Liabilities $ 6,946,443 40% $ 6,058,818 39% $ 7,872,733 44%
Non-Current Liabilities 10,533,015 60% 9,613,780 61% 9,895,043 56%
Total Liabilities 17,479,458 100% 15,672,598 100% 17,767,776 100%
Net Position:
Invested in Capital
Assets
796,811 4% 854,704 4% 910,707 4%
Unrestricted 20,539,529 96% 21,154,940 96% 19,819,598 96%
Total Net Position 21,336,340 100% 22,009,644 100% 20,730,305 100%
Total Liabilities and Net
Position $ 38,815,798 100% $ 37,682,242 100% $ 38,498,081 100%
CONDENSED FINANCIAL INFORMATION
Statement of
Net Position
Statement of
Revenues,
Expenses, and
Changes in Net
Position
Year Ended
June 30, 2014
Year Ended
June 30, 2013
Year Ended
June 30, 2012
Operating Revenues:
Member Contributions $11,400,010 10,974,682 $10,370,943
Retro Premium Adjust. (RPA) (2,000,000) (1,596,727) 0
Other 2,231,991 617,193 11,564
11,632,001 9,995,148 10,382,507
Operating Expenses:
Claims Expense 6,286,816 2,747,997 5,339,189
Excess Insurance Expense 3,780,577 3,792,563 3,553,110
Program Services Expense 976,571 752,420 589,130
Excess Insurance Refund 382,087 0 0
General Administrative Expense 1,300,834 1,242,911 1,202,806
Total Operating Expenses 12,726,885 8,535,891 10,684,235
Operating Income (Loss) (1,094,884) 1,459,257 (301,728)
Non-Operating Income
and (Expense):
Investment Income 451,404 47,272 409,857
Facility Expense (29,824) (49,848) (51,695)
Total Non-Operating Income
(Expense)
421,580 (2,576) 358,162
Income (Loss)
Before Equity Distribution
(673,304) 1,456,681 56,434
Equity Distribution 0 (177,342) (224,956)
Change in Net Position (673,304) 1,279,339 (168,522)
Net Position, Beginning of Year 22,009,644 20,730,305 20,898,827
Net Position, End of Year $21,336,340 $22,009,644 $20,730,305

14
ANALYSIS OF OVERALL FINANCIAL POSITION
PARSAC continues to be financially stable, meeting Board
approved equity targets and exceeding the actuary’s 90%
confidence level for funding overall. Total assets increased by
3% while net position decreased by 3%. The net position of the
Liability Program increased by $306,000 due to the receipt of
$2.2 million in excess provider dividends offset by increasing
claim costs and $1 million return of funds to members in the
form of a Retrospective Premium Adjustment (RPA) and return
of a portion of excess dividends. The Workers’ Compensation
Program’s net position decreased by $949,000 due to increasing
claim reserves and the issuance of a $1 million RPA.
The Authority’s investment portfolio increased from $30.8 to $34.7 million during the year, and is managed
by investment advisor, PFM Asset Management, LLC with securities held in a custodial account at Union Bank.
The actively managed portfolio consists of fixed income, municipal and medium term corporate securities in
accordance with the Authority’s investment policy and the California Government Code. Short term funds
not immediately needed for the payment of claims and administrative expenses are maintained in the State
of California Local Agency Investment Fund (LAIF), which is administered by the State Treasurer’s Office. At
June 30, 2014, the LAIF balance was approximately $391,000.
Figure 2 above, illustrates the portfolio’s change in maturity distribution from the prior year. The portfolio
duration was concentrated in the two to four year range to maximize yield. Future investment earnings
directly impacts program rates, as this projected income is a part of the funding and future liability calculation.
When investments fall short of projections, additional funding may be required to meet actuarial revenue
estimates. The Authority takes interest rate conditions into consideration when developing annual premiums.
Liability
Program
43%
Workers'
Compensation
Program
54%
Property/Bond
Program
0%
Building Fund
3%
Figure 1 – Total Assets by Program
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
%ofTotalPortfolio
June 30,2013 June 30, 2014
Figure 2 – Portfolio Maturity Distribution at June 30, 2014 and June 30, 2013

ANALYSIS OF OVERALL RESULTS OF OPERATIONS
All members participate in the Liability Program,
which generated the largest portion of revenue at $6.2
million or 51%. That percentage drops to 33% when the
reimbursements from two excess providers of $2.2 million
are not included in the program revenue. The Workers’
Compensation Program follows at $3.9 million, representing
33% of revenue. Investment income, including coupon
earnings of $409,900 and gains on the sale of investments
of $61,500, was offset by market value losses for total
investment income of $451,400.
Overall, operating expenses increased by $4.2 million.
This was mainly due to an increase in the expenses for
claims paid and change in claim liabilities. Additionally,
$382,000 of excess reimbursements were returned to
members. Claims expense and excess insurance make up
about 80% of expenses as shown in the Figure 4. Claims
administration and loss control programs represent 7% of
expenses and general administration is 9% of expenses.
Retrospective Premium Adjustments and Rate
Stabilization Fund
Retrospective Premium Adjustment (RPA) is the original term for equity distributions and assessments. The
calculation of the RPA is based on policies requiring a minimum overall funding level as well as Target Equity
goal equal to five times the pool self-insured retention before funds can be released. Both programs met
the respective equity goals. The Board approved an RPA of $1,000,000 in each self-insured program. The
Liability Program RPA applies to members participating in program years 2003/04 to 2008/09. The Workers’
Compensation Program RPA applies to program years 1990/91 to 2005/06.
Rate Stabilization Funds were established in both the Liability and Workers’ Compensation programs to
help cushion the impact of pool or excess rate increases. This year, the Board approved replenishment of
the Liability Program Rate Stabilization Fund using a portion of an excess reimbursement. In the Workers’
Compensation Program, members received a premium reduction totaling $177,342 from the Board approved
use of Rate Stabilization funds.
Claims Expense
The Authority contracts with Bickmore Risk Services for annual funding and year-end actuarial valuations of the
self-insured Liability and Workers’ Compensation Programs.
On the following page, Figure 5 illustrates the Liability Program Ultimate Loss by Program Year as determined by
the actuary. The ultimate loss represents the total cost of claims expected in a given program year. Components
of ultimate loss are paid and reserved claims, and incurred but not reported (IBNR) reserves. The Liability
Program claim history has been unpredictable, with claim costs ranging from a high of $5.4 million to a low
of $50,000. The actuary set the ultimate cost of claims at an average of $1.7 million over the past five years, a
reduction from $2.5 million reported last year.
Figure 3 – Revenue by Program
Liability
Program
51%
Work Comp
Program
32%
Prop/Bond
Program
13%
Investment
Income
4%
Building Income
0%
Claims Expense
49%Excess
Insurance
30%
Claims
Admin.
4%
Loss Control
Expense
3%
Consultants
1%
Excess Ins.
Refund
3%
GeneralAdmin.
9%
Figure 4 –Total Expense by Category

16
Figure 6 illustrates the Workers’ Compensation Program Ultimate Loss by Program Year as determined
by the actuary. The Program’s history indicates a more consistent pattern than the Liability Program with
program year claims costs in the early years averaging $1 million. Claims costs began increasing six years ago,
nearly tripling the prior annual cost expectations. In the past three years, claims have trended down and the
actuary’s average ultimate cost of claims is $2.1 million per year.
CAPITAL ASSETS
The majority of the Authority’s capital assets are invested in a building located in Sacramento. The building
houses PARSAC’s administrative office and the remaining 3,600 square feet, formerly tenant space, has been
converted into a conference facility for meetings and training. The Authority will endeavor to lease the space
when economic circumstances in the market improve.
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
86/87
87/88
88/89
89/90
90/91
91/92
92/93
93/94
94/95
95/96
96/97
97/98
98/99
99/00
00/01
01/02
02/03
03/04
04/05
05/06
06/07
07/08
08/09
09/10
Paid (less recovery)
Reserves for Reported Claims
Discounted IBNR & Reserve
Figure 5 – Liability Program Ultimate Loss by Program Year
-$1,000,000
$0
$1,000,000
$2,000,000
$3,000,000
$4,000,000
$5,000,000
$6,000,000
86/87
87/88
88/89
89/90
90/91
91/92
92/93
93/94
94/95
95/96
96/97
97/98
98/99
99/00
00/01
01/02
02/03
03/04
04/05
05/06
06/07
07/08
08/09
09/10
10/11
11/12
12/13
13/14
Paid (less recovery) Reserves for Reported Discounted IBNR & ULAE
Figure 6 – Workers’ Compensation Program Ultimate Loss by Program Year
-$500,000
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
$2,500,000
$3,000,000
$3,500,000
$4,000,000
90/91
91/92
92/93
93/94
94/95
95/96
96/97
97/98
98/99
99/00
00/01
01/02
02/03
03/04
04/05
05/06
06/07
07/08
08/09
09/10
10/11
11/12
12/13
13/14
Paid (less recovery) Reserves for Reported Claims Discounted IBNR & ULAE

2014 2013
ASSETS
Current Assets:
Cash and Cash Equivalents $1,065,383 $5,218,396
Interest Receivable 85,947 89,652
Member Receivable 494,587 207,138
Excess Receivable 606,449 254,993
ERMA Dividend Receivable 932,190 0
Prepaid Expenses 34,860 36,290
Net Pension Asset 0 43,606
Investments 0 1,311,532
Total Current Assets 3,219,416 7,161,607
Non-Current Assets:
Investments 34,739,021 29,544,829
Capital Assets 1,691,732 1,702,400
Accumulated Depreciation (894,921) (847,696)
Total Non-Current Assets 35,596,382 30,520,635
Total Assets $38,815,798 $37,682,242
LIABILITIES & NET POSITION
Current Liabilities:
Accounts Payable $ 81,788 $56,424
Accrued Expenses 138,702 120,701
Committee Training Stipend Payable 15,260 17,628
Unearned Contributions 0 184,816
Equity Distribution Payable 0 177,342
Excess Premium Assessments 24,469 48,938
Retrospective Premium Adjustment
Payable
2,513,075 1,375,308
Unpaid Claims and Adjustment Expenses 4,173,149 4,077,661
Total Current Liabilities 6,946,443 6,058,818
Non-Current Liabilities:
Unpaid Claims and Claims Adjustment
Expenses
10,508,546 9,613,780
Total Non-Current Liabilities 10,533,015 9,662,718
Total Liabilities 17,479,458 15,672,598
Net Position:
Invested In Capital Assets 796,811 854,704
Unrestricted 20,539,529 21,154,940
Total Net Position $21,336,340 $22,009,644
STATEMENT OF
NET POSITION
June 30, 2014 and 2013

18
2014 2013
Operating Revenues:
Premium Contributions $11,400,010 $10,974,682
Retrospective Adjustment (2,000,000) (1,596,727)
CARMA Dividend 1,289,022 0
ERMA Dividend 932,190 612,305
Other 10,779 4,888
Total Operating Revenues 11,632,001 9,995,148
Operating Expenses:
Claims Paid 5,296,562 3,692,284
Change In Claims Liabilities 990,254 (944,287)
Excess Insurance 3,780,577 3,792,563
Program Administration 576,370 553,668
Risk Management 400,201 198,752
Professional Fees 144,508 183,115
Salaries 933,905 849,783
Travel and Meetings 73,612 75,769
CARMA Dividend Refunds 382,087 0
Facility Expense 63,791 49,848
Other General and Administrative Expenses 85,018 84,396
Total Operating Expenses 12,726,885 8,535,891
Operating Income (Loss) (1,094,884) 1,459,257
Non-Operating Revenues (Expenses):
Investment Income 451,404 47,272
Facility Expense, Net (29,824) (49,848)
Total Non-Operating Revenues (Expenses) 421,580 (2,576)
Income Before Equity Distribution (673,304) 1,456,681
Equity Distribution 0 (177,342)
Change in Net Position (673,304) 1,279,339
Net Position, Beginning of Year 22,009,644 20,730,305
Net Position, End of Year $21,336,340 $22,009,644
STATEMENT
OF REVENUES,
EXPENSES AND
CHANGES IN NET
POSITION
For the Years Ended
June 30, 2014 and 2013

2014 2013
Cash Flows from Operating Activities:
Contributions Received $10,123,696 $8,337,047
ERMA Dividend 0 612,305
CARMA Dividend 1,289,022 0
Other Revenues 10,779 0
Salaries and Benefits Paid (872,298) (796,348)
Claims Expense Paid (5,648,018) (3,892,450)
Premiums Paid (3,803,616) (1,710,631)
General and Administrative Expenses Paid (1,257,152) (1,086,577)
CARMA Dividend Refunds (382,087) 0
Net Cash Provided By (Used) Operating Activities (539,674) 1,463,346
Cash Flows from Investing Activities:
Investment Income 344,175 74,039
Investments Purchased (23,002,998) (14,046,863)
Proceeds from Sales and Maturities of Investments 19,231,272 14,097,268
Facilities Expenses Paid (8,446) (25,688)
Net Cash Provided (Used) By Investing Activities (3,435,997) 98,756
Cash Flows from Capital and Related Financing Activities:
Member Equity Distributions (177,342) (224,956)
Purchase of Capital Assets 0 (8,483)
Net Cash Used In Capital and Related Financing Activities (177,342) (233,439)
Net Increase (Decrease) in Cash and Cash Equivalents (4,153,013) 1,328,663
Cash and Cash Equivalents, Beginning of Year 5,218,396 3,889,733
Cash and Cash Equivalents, End of Year $ 1,065,383 $5,218,396
Reconciliation of Net Operating Income (Loss) To Net Cash
Provided By Operating Activities:
Operating Income (Loss) $(1,094,884) $1,459,257
Adjustments To Reconcile Operating Income (Loss) To Net
Cash Provided By Operating Activities:
Depreciation Expense 36,515 40,326
(Increase) Decrease In:
Member Receivable (226,897) 134,894
Excess Receivable (351,456) (200,166)
ERMA Dividend Receivable (932,190)
Prepaid Expenses 1,430 2,032,994
Net Pension Asset 43,606 43,605
Increase (Decrease) In:
Accounts Payable 49,833 18,644
Accrued Expenses 18,001 9,831
Committee Training Stipend Payable (2,368) 1,021
Unearned Contributions (184,816) (2,291,015)
Excess Premium Assessments (24,469) 48,938
Retrospective Premium Adjustment Payable 1,137,767 1,109,304
Claims Liabilities 990,254 (944,287)
Net Cash Provided (Used) By Operating Activities $(539,674) $1,463,346
Supplementary Non-Cash Flow Information
Investing Activities
Decrease in Fair Value of Investments $20,045 $427,470
STATEMENT OF
CASH FLOWS
For the Years Ended
June 30, 2014 and 2013

20
1. ORGANIZATION
General. The Public Agency Risk Sharing Authority of California (PARSAC) is a governmental joint powers
authority pursuant to the Government Code of the State of California, commencing with Section
6500. PARSAC is a statewide agency providing California municipalities with risk management
services including loss control, risk sharing and joint purchase coverage programs.
PARSAC offers self-funded Liability and Workers’ Compensation programs. In addition, PARSAC
offers members access to group purchase insurance programs covering Property, Fidelity Bonds,
Special Events and Employee Benefits.
Liability Program: The Liability Program, implemented in 1986, provides comprehensive general and
automobile liability coverage. PARSAC is self-insured to $1 million and purchases excess coverage
through the California State Association of Counties Excess Insurance Authority (CSAC-EIA).
PARSAC also offers members Employment Practices Liability coverage through the Employment Risk
Management Authority (ERMA).
Workers’ Compensation Program: The Workers’ Compensation Program, implemented in 1990, provides
coverage for employee injuries arising out of and in the course of employment. From 1990 to 2007,
PARSAC was self-insured to $250,000. In 2008, PARSAC increased the self-insured retention from
$250,000 to $500,000. Losses in excess of PARSAC’s limit are covered through the Local Agency
Workers’ Compensation Excess Pool (LAWCX) up to statutory limits.
PARSAC is a California public entity as provided in Internal Revenue Section 115; thus, it is tax-
exempt. The California Office of the Controller, Division of Local Governmental Fiscal Affairs, for the
purpose of filing an Annual Report of Financial Transactions of Special Districts considers PARSAC to
be a “Special District.”
Reporting Entity. The reporting entity includes all activities considered to be part of PARSAC. This includes
financial activity relating to all of the membership years of PARSAC. In determining its reporting
entity, PARSAC considered all governmental units that were members of PARSAC since inception.
The criteria did not require the inclusion of these entities in their financial statements principally
because PARSAC does not exercise oversight responsibility over any members.
Basis of Accounting. The accompanying financial statements are presented on the accrual basis of accounting
in accordance with accounting principles generally accepted in the United States of America. Under
the accrual basis, revenues and the related assets are recognized when earned, and expenses are
recognized when the obligation is incurred. PARSAC applies all applicable FASB pronouncements
in accounting and reporting for its proprietary operations, except where superseded by GASB
pronouncements. Liabilities for reserves for open claims and claims incurred but not reported have
been recorded in PARSAC’s financial statements.
PARSAC maintains separate program accounting for each program’s revenues, expenses and related
reserves. The program funds are considered a Proprietary/Enterprise Fund type.
Fund Accounting. The accounts of PARSAC are organized on the basis of funds, each of which is considered
to be a separate accounting entity. PARSAC’s funds have been combined for the presentation of the
basic financial statements. The operations of each fund are accounted for by providing a separate set
of self- balancing accounts which comprise its assets, liabilities, net position, revenues and expenses.
The general and administrative expenses of PARSAC are allocated 55% to the Liability Program, 40%
to the Workers’ Compensation Program and 5% to the Property Program.
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED JUNE 30, 2014 AND 2013

Cash and Cash Equivalents. For purposes of the statement of cash flows, PARSAC considers all highly liquid
assets with a maturity of three months or less, when purchased, to be cash and cash equivalents.
Receivables. All receivables are reported at their gross value, and where appropriate, are reduced by the
estimated portion that is expected to be uncollectible. As of June 30, 2014 and 2013, the total
accounts receivable portfolio was considered collectible. Interest on investments is recorded in the
year the interest is earned.
Investments and Investment Pools. PARSAC records its investment in Local Agency Investment Fund (LAIF)
and its other investments at fair value. Changes in fair value are reported as non-operating revenue in
the statement of revenues, expenses and changes in net position.
Fair value of investments and LAIF has been determined by the sponsoring government based on
quoted market prices. PARSAC’s investment in LAIF has been valued based on the relative fair value
of the entire external pool to the external pool’s respective amortized cost.
Capital Assets. Capital assets are carried at cost. Assets with an original purchase price over $10,000 are
capitalized at cost. Depreciation and amortization is computed on the straight-line method. The
estimated useful lives used for buildings and improvements is thirty years. The estimated useful life
for furniture and equipment range from three to five years. Software is depreciated over five years.
Accrued Vacation. In accordance with PARSAC’s employee policies, compensated absences for vacation are
accrued at various numbers of hours per month depending on each employee’s years of service. The
liability for compensated absences at June 30, 2014 and 2013 was $102,158 and $84,045, respectively,
and is included in accrued expenses on the statement of net position.
Provision for Unpaid Claims and Claims Adjustment Expenses. PARSAC’s policy is to establish claims liabilities
based on estimates of the ultimate cost of claims that have been reported but not settled, and of
claims that have been incurred but not reported. The length of time for which such costs must be
estimated varies depending on the coverage involved. Estimated amounts of salvage, subrogation and
insurance recoverable on unpaid claims are deducted from the liability for unpaid claims. PARSAC
increases the liability for allocated and unallocated claims adjustment expenses. Because actual claims
costs depend on such complex factors as inflation, changes in doctrine of legal liability and damage
awards, the process used in computing claims liabilities does not necessarily result in an exact amount.
Claims liabilities are recomputed periodically using a variety of actuarial and statistical techniques to
produce current estimates that reflect recent settlements, claim frequency and other economic and
social factors. A provision for inflation in the calculation of estimated future claims costs is implicit in
the calculation because reliance is placed both on actual historical data that reflect past inflation and
on other factors that are considered to be appropriate modifiers of past experience. Adjustments
to claims liabilities are charged or credited to expense in the period in which they are made. The
portion of claims considered currently payable has been actuarially determined.
Net Position. PARSAC adopted a Target Equity policy to ensure adequate overall funding of the pooled
programs. The policy designates that equity may be returned to members when (1) the overall
confidence level exceeds 90%, (2) an additional amount equal to five times the self-insured retention
has been set aside and (3) equity is available to return in eligible years.
The three methods approved for returning equity to members are, (1) the Retrospective Premium
Adjustment (RPA) process; (2) the Liability and Workers’ Compensation Program Rate Stabilization
Fund, and (3) an alternate use of equity approach.

22
• The RPA process reconciles program year revenue and expenses. Claims in the Liability
Program become eligible for an RPA in the fifth year; thus, allowing the claims sufficient time for
development. Workers’ Compensation Program claims first become eligible for an RPA in the
eighth year.
• The Liability Program Rate Stabilization Fund was established in 2009/10 from the savings realized
when PARSAC changed excess programs. The policy limits the fund balance to $500,000 and
allows these funds to be used to offset pool or excess premium rate increases. In May 2012, the
Board approved use of $125,000 to reduce the premium contribution for the 2012/13 year.
• The Workers’ Compensation Program established a Rate Stabilization Fund. The policy limits
the fund balance to $500,000 and allows funds to be used to offset pool or excess premium rate
increases. The Board approved use of $177,342 to apply against the 2013/14 premium increase.
• The Board approved a one-time alternate use of equity allowing members to reduce their
Workers’ Compensation Program premium contribution by $99,956 for the 2012/13 year.
Excess Insurance. PARSAC enters into agreements whereby it obtains excess coverage from other joint
powers authorities or insurance companies. PARSAC does not report excess insured risk as a liability
unless it is probable that a risk will not be covered by excess insurers. Settlements have not exceeded
insurance coverage in each of the past three years.
Revenue Recognition. Premium contributions are recognized as revenue when earned based upon the
coverage period of the related insurance. To the extent that allocated losses exceed premium
contributions previously paid, interest and other income, PARSAC can assess its member’s additional
contributions. Supplemental assessments are recognized as income in the period assessed. Operating
revenues and expenses include all activities necessary to achieve the objectives of PARSAC. Non-
operating revenues and expenses include investment activities, rental income and other non-essential
activity.
Use of Estimates. The preparation of financial statements in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and assumptions.
These estimates and assumptions affect the reported amounts of assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results could differ from these estimates.
Income Taxes. As a governmental agency PARSAC is exempt from both federal income and California state
franchise taxes.
Reclassifications. Certain reclassifications have been made to the prior year balances to conform with the
current year presentation.
New Pronouncements. In June 2012, the GASB approved Statement No. 68, Accounting and Financial
Reporting for Pensions. This Statement requires governments providing defined benefit pension
plans to recognize their long-term obligation for pension benefits as a liability on the statement of
net position and to more comprehensively and comparably measure the annual costs of pension
benefits. This Statement also requires revised and new note disclosures and required supplementary
information (RSI) to be reported by employers. The implementation of this GASB Statement will have
a significant impact on the Authority’s financial statements and is effective for the Authority’s June 30,
2015 financial statements.

2. CASH AND CASH EQUIVALENTS
Cash and cash equivalents as of June 30, 2014 and 2013 consisted of the following:
2014 2013
Cash and Cash Equivalents:
Cash on Hand $ 34 $ 99
Cash in Bank 557,859 1,132,612
LAIF 391,327 3,930,766
Money Market Accounts 116,163 154,919
Total Cash and Cash Equivalents $1,065,383 $ 5,218,396
Custodial Credit Risk. Custodial credit risk for deposits is the risk that, in the event of the failure of a
depository financial institution, a government will not be able to recover its deposits or will not be
able to recover collateral securities that are in the possession of an outside party. The custodial
credit risk for investments is the risk that, in the event of the failure of the counterparty (e.g., broker-
dealer) to a transaction, a government will not be able to recover the value of its investment or
collateral securities that are in the possession of another party. None of PARSAC’s investments were
subject to custodial credit risk. Custodial credit risk does not apply to a local government’s indirect
investment in securities through the use of mutual funds or government investment pools (such as
LAIF). The California Government Code and PARSAC’s investment policy do not contain legal or
policy requirements that would limit the exposure to custodial credit risk for deposits or investments,
other than the following provision of deposits: The California Government Code requires that a
financial institution secure deposits made by state or local governmental units by pledging securities
in an undivided collateral pool held by a depository regulated under state law (unless so waived by
the governmental unit). The market value of the pledged securities in the collateral pool must equal
at least 110% of the total amount deposited by the public agencies. California law also allows financial
institutions to secure public entity deposits by pledging first trust deed mortgage notes having a value
of 150% of the secured public deposits.
As of June 30, 2014 and 2013, none of PARSAC’s deposits with financial institutions in excess of
federal depository insurance limits were held in uncollateralized accounts.
Local Agency Investment Fund. PARSAC places certain funds with the State of California’s Local Agency
Investment Fund (LAIF). PARSAC is a voluntary participant in LAIF, which is regulated by California
Government Code Section 16429 under the oversight of the Treasurer of the State of California and
the Pooled Money Investment Board. The State Treasurer’s Office pools these funds with those of
other governmental agencies in the State and invests the cash. The fair value of PARSAC’s investment
in this pool is reported in the accompanying financial statements based upon PARSAC’s pro-rata share
of the fair value provided by LAIF for the entire LAIF portfolio (in relation to the amortized costs of
that portfolio). The monies held in the pooled investment funds are not subject to categorization by
risk category. The balance available for withdrawal is based on the accounting records maintained by
LAIF, which are recorded on an amortized cost basis.

24
3. INVESTMENTS
At June 30, 2014 and 2013, investments are reported at fair value and consisted of the following:
2014 2013
Federal Agency Bonds and Notes $11,490,995 $15,479,463
U.S. Treasury Notes 17,060,285 14,117,812
Municipal Obligations 1,267,748 1,259,086
Corporate Notes 4,919,993 0
Total Investments 34,739,021 30,856,361
Investments maturing within one year 0 1,311,532
Long-term investments $34,739,021 $29,544,829
Disclosures Relating to Interest Risk Rate. Interest rate risk is the risk that changes in market interest
rates will adversely affect the fair value of an investment. Generally, the longer the maturity of an
investment, the greater the sensitivity of its fair value to changes in market interest rates. One of
the ways that PARSAC manages its exposure to interest rate risk is by purchasing a combination of
shorter term and longer term investments and by timing cash flows from maturities so that a portion
of the portfolio is maturing or coming close to maturity evenly over time as necessary to provide the
cash flow and liquidity needed for operations.
Information about the sensitivity of the fair values of PARSAC’s investments to market interest rate
fluctuations is provided by the following table that shows the distribution of PARSAC’s investments by
maturity at June 30, 2014 and 2013:
June 30, 2014 Remaining Maturity (in Months)
Investment Type Amount
12 Months
Or Less
13 to 24
Months
25 to 60
Months
Federal Agency Bonds and
Notes:
FHLMC $ 4,849,920 $ $ 1,815,118 $ 3,034,802
FNMA 5,258,899 901,530 4,357,369
FHLB 1,382,165 700,091 682,074
U.S.Treasury Notes 17,060,302 8,114,594 8,945,708
Corporate Notes 4,919,987 4,919,987
Total $ 34,739,021 $ $ 11,531,333 $ 23,207,688

June 30, 2013 Remaining Maturity (in Months)
Investment Type Amount
12 Months
Or Less
13 to 24
Months
25 to 60
Months
Notes:
FHLMC $ 5,187,794 $ $ 1,453,989 $ 3,733,805
FNMA 8,980,137 746,214 8,233,923
FHLB 1,311,532 1,311,532
U.S.Treasury Notes 14,117,812 6,210,649 7,907,163
Total $ 30,856,361 $ 1,311,532 $ 8,410,852 $ 21,133,977
Investments with Fair Values Highly Sensitive to Interest Rate Fluctuations. PARSAC’s portfolio includes the
following investments that are highly sensitive to interest rate fluctuations (to a greater degree than
already indicated in the information provided above).
Highly Sensitive Investments Fair Value at Year End
Federal Agency Securities $1,382,165
These securities are subject to early payment in a period of declining interest rates. The resultant
reduction in expected total cash flows affects the fair value of these securities and makes the fair value
of these securities highly sensitive to changes in interest rates.
Disclosures Relating to Credit Risk. Generally, credit risk is the risk that an issuer of an investment will not
fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a
nationally recognized statistical rating organization. Presented below is the actual Standard and Poor’s
rating as of June 30, 2014 and 2013 for each investment type:
June 30, 2014 Rating as ofYear-End
Investment Type Amount A AA AAA
Federal Agency Bonds
and Notes:
FHLMC $ 4,849,920 $ $ 4,849,920 $
FNMA 5,258,899 5,258,899
FHLB 1,382,165 1,382,165
U.S.Treasury Notes 17,060,302 17,060,302
Corporate Notes 4,919,987 873,458 3,120,562 925,967
Total $ 34,739,021 $ 873,458 $ 31,671,848 $ 2,193,715

26
June 30, 2013 Rating as ofYear-End
Investment Type Amount AA AAA
Notes:
FHLMC $ 5,187,794 5,187,794
FNMA 8,980,137 8,980,137
FHLB 1,311,532 1,311,532
U.S.Treasury Notes 14,117,812 14,117,812
Total $ 30,856,361 $ 29,597,275 $ 1,259,086
Concentration of Credit Risk. At June 30, 2014 and 2013, PARSAC had the following investments that
represent more than five percent of PARSAC’s net investments:
2014 2013
U.S.Treasury Notes 49% 46%
FHLMC 14% 17%
FNMA 15% 29%
4. CAPITAL ASSETS
PARSAC’s capital asset activity for the year ended June 30, 2014 is as follows:
Beginning
Balance Additions
Retirements/
Adjustments
Ending
Balance
Capital Assets Not Being Depreciated
Land $ 515,861 $ $ $ 515,861
Total Capital Assets Not Being Depreciated 515,861 515,861
Capital Assets Being Depreciated
Building 807,042 807,042
Building Improvements 203,585 203,585
Equipment 135,412 (10,675) 124,737
Vehicles 40,500 40,500
Total Capital Assets Being Depreciated 1,186,539 (10,675) 1,175,864
Less Accumulated Depreciation For
Building 519,910 40,488 560,398
Building Improvements 187,880 2,267 190,147
Equipment 117,631 7,039 (10,675) 113,995
Vehicles 22,275 8,099 30,374
Total Accumulated Depreciation 847,696 57,893 (10,675) 894,914
Total Capital Assets Being Depreciated Net 338,843 (57,893) 280,950
Total Capital Assets, Net $ 854,704 $ (57,893) $ 0 $ 796,811

Depreciation expense was charged to the various programs as follows:
Liability $ $20,083
Workers’ Compensation 14,606
Building 21,379
Property 1,825
$ $57,893
PARSAC’s capital asset activity for the year ended June 30, 2013 is as follows:
Beginning
Balance Additions
Retirements/
Adjustments
Ending
Balance
Capital Assets Not Being Depreciated
Land $ 515,861 $ $ 515,861
Total Capital Assets Not Being Depreciated 515,861 515,861
Capital Assets Being Depreciated
Building 805,562 1,480 807,042
Building Improvements 203,585 203,585
Equipment 128,409 7,003 135,412
Vehicles 40,500 40,500
Total Capital Assets Being Depreciated 1,178,056 8,483 1,186,539
Less Accumulated Depreciation For
Building 473,859 46,051 519,910
Building Improvements 185,612 2,268 187,880
Equipment 109,564 8,067 117,631
Vehicles
14,175
8,100
22,275
Total Accumulated Depreciation 783,210 64,486 847,696
Total Capital Assets Being Depreciated Net 394,846 (56,003) 338,843
Total Capital Assets, Net $ 910,707 $ (56,003) $ 854,704
Depreciation expense was charged to the various programs as follows:
Liability $ 22,179
Workers’ Compensation 16,131
Building 24,160
Property 2,016
$ 64,486

28
5. FACILITY EXPENSES
PARSAC purchased an 8,700 square foot building in Sacramento in 1995. Of the 7,200 useable square feet,
PARSAC occupies approximately 3,576 square feet and historically leased out the balance. Due to the
continued downward trend in the Sacramento commercial leasing market, approximately 3,639 square feet
of unoccupied tenant space was converted to a conference facility. The space is available for training and
committee meetings. PARSAC will endeavor to lease the space when economic circumstances improve.
The tenant space was vacant during the fiscal years 2014 and 2013. For the periods ended June 30, 2014 and
2013, the facility expenses were $93,615 and $99,696, respectively. For the 2013/2014 year, 50% of budgeted
facility expenses totaling $63,791 were allocated to the programs in the same proportion as general and
administrative expenses. For the 2012/2013 year, 50% of facility expenses were allocated to the programs in
the same proportion as general and administrative expenses.
6. RETROSPECTIVE PREMIUM ADJUSTMENTS
PARSAC’s Joint Powers Agreement requires periodic evaluation of each programs’ equity. The process is
referred to as a Retrospective Premium Adjustment (RPA). For the year ended June 30, 2014, the Board
approved RPA’s of $1,000,000 in both the Liability and Workers’ Compensation programs.
For the year ended June 30, 2013, the Board approved RPA’s in the Liability and Workers’ Compensation
programs of $1,029,144 and $567,583, respectively.
7. NET POSITION
Net Position is the excess of all the Authority’s assets and deferred outflows over all its liabilities, and
deferred inflows. Net Position is divided into three categories as follows:
Investment in Capital Assets describes the portion of net position which is represented by the current net
book value of the Authority’s capital assets, less the outstanding balance of any debt issue to finance these
assets, if any.
Restricted describes the portion of net position which is restricted as to use by the terms and conditions of
agreements with outside parties, governmental regulations, laws, or other restrictions which the Authority
cannot unilaterally alter. These principally include facility capacity fees received for use on capital projects,
fees charged for the provision of future water resources and debt service reserve funds. Unrestricted
describes the portion of net position which is not restricted as to use. PARSAC’s net position as of June 30,
2014 and 2013 consists of the following:
2014 2013
Invested in Capital Assets $ 796,811 $ 854,704
Unrestricted, Designated for:
Errors and Omission 100,000 100,000
Capital Replacement 168,839 144,589
Grant Program 105,572 282,624
Rate Stabilization 822,658 873,225
Target Equity 7,500,000 7,500,000
Undesignated Balance 11,742,460 12,254,502
Contingency Fund 100,000 0
Unrestricted Total 20,539,529 21,154,940
Net Position $ 21,336,340 $ 22,009,644

8. UNPAID CLAIMS AND CLAIM ADJUSTMENT EXPENSES
As discussed in Note 1, PARSAC establishes a liability for both reported and unreported insured events,
which includes estimates of both future payments of losses and related claim adjustment expenses, both
allocated and unallocated. The following represents changes in those aggregate liabilities during the years
ended June 30, 2014 and 2013.
2014 2013
Unpaid claims and claims adjustment expenses,
beginning of fiscal year $ 13,691,441 $ 14,635,728
Incurred claims and claims adjustment expenses:
Provision for covered events of the current fiscal
year 3,882,102 3,900,101
Change in provision for covered events of prior fiscal
years 2,404,714 (1,152,104)
Total incurred claims and claims adjustment expense 6,286,816 2,747,997
Payments:
Claims and claims adjustment expenses attributable
to covered events of the current fiscal year 512,691 508,897
Claims and claims adjustment expenses attributable
to covered events of prior fiscal years 4,783,871 3,183,387
Total Payments 5,296,562 3,692,284
Total unpaid claims and claims adjustment expenses,
end of fiscal year $ 14,681,695 $ 13,691,441
The components of the unpaid claims and claim adjustment expenses as of June 30, 2014 and 2013 were as
follows:
2014 2013
Claims Reserves $ 7,935,598 $ 7,501,573
Claims incurred but not reported (IBNR) 5,590,835 5,331,292
Unallocated loss adjustment expenses (ULAE) 1,155,262 858,576
$ 14,681,695 $ 13,691,441
The current and long-term portions of claims liabilities were $4,173,149 and $10,508,546, respectively, as of
June 30, 2014 and were $4,077,661 and $9,613,780, as of June 30, 2013. At June 30, 2014 and 2013, the liability
was reported at the present value using an expected future investment yield assumption of 2.5% for both
years presented, for the Workers’ Compensation Program and 1.5% for both years presented, for the Liability
Program. The total undiscounted liability as of June 30, 2014 and 2013 was $16,305,147 and $15,115,603,
respectively.
9. EMPLOYEE RETIREMENT SYSTEM
Qualified employees are covered under an agent multi-employer defined benefit pension plan maintained by
an agency of the State of California. PARSAC’s employees are members of the California Public Employees’
Retirement System (CalPERS).

30
Plan Description. PARSAC’s defined benefit pension plan (the “Plan”) provides retirement and disability
benefits, annual cost-of-living adjustments, and death benefits to Plan members and beneficiaries.
The Plan is part of the Public Agency portion of the California Public Employees Retirement System
(CalPERS), an agent multiple-employer plan administered by CalPERS, which acts as a common
investment and administrative agent for participating public employers within the State of California.
A menu of benefit provisions as well as other requirements are established by State statutes within
the Public Employees’ Retirement Law. The Plan selects optional benefit provisions from the benefit
menu by contract with CalPERS and adopts those benefits through Board approval. CalPERS issues a
separate comprehensive annual financial report. Copies of the CalPERS’ annual financial report may
be obtained from the CalPERS Executive Office at 400 P Street; Sacramento, California 95814.
Funding Policy. PARSAC contributes 6% of the required 8% of the active plan members’ annual salary, for
the employees’ portion of retirement contributions. The employees contribute the remaining 2%.
PARSAC is required to contribute the actuarially determined remaining amounts necessary to fund
the benefits for its members. The actuarial methods and assumptions used are those adopted by the
CalPERS Board of Administration. The required employer contribution rate for the year ended June
30, 2014 was 16.541%. The contribution requirements of the plan are established by state statute and
may be amended by CalPERS.
Annual Pension Costs. For the year ended June 30, 2014, PARSAC’s annual pension cost was $167,804 and
PARSAC contributed $124,198. The required contribution was determined as part of the June 30,
2012 actuarial valuation. A summary of the principle assumptions and methods used to determine the
annual required contribution is shown below.
Valuation Date June 30, 2012
Actual cost method Entry age normal cost method
Amortization method Level percent of payroll
Average remaining period 19 years as of the valuation date
Asset Valuation Method 15 Year Smoothed Market
Actuarial Assumptions:
Investment Rate of Return 7.50% (net of administrative expenses)
Projected Salary Increases 3.30% to 14.20% depending on Age,
Service and Type of Employment
Inflation 2.75%
Payroll Growth 3.00%
Individual Salary Growth A merit scaled varying by duration of
employment coupled with an assumed
annual inflation growth of 2.75% and an
annual production growth of 0.25%
PARSAC’s plan had less than 100 active members as of the June 30, 2012 actuarial valuation. As a
result, PARSAC’s members are required to participate in a larger risk pool Miscellaneous 2.5% at 55
Risk Pool.

The excess of the total actuarial accrued liability over the actuarial value of plan assets is called the
unfunded actuarial accrued liability. Funding requirements are determined by adding the normal cost
and an amortization of the unfunded liability as a level percentage of assumed future payrolls. All
changes in liability due to changes in actuarial assumptions, or changes in actuarial methodology are
amortized separately over a 20-year period. All new gains or losses are tracked and amortized over
a rolling 30-year period. If a pool’s accrued liability exceeds the actuarial value of assets, the annual
contribution with respect to the total unfunded liability may not be less than the amount produced by
a 30-year amortization of the unfunded liability.
Trend Information for CalPERS Miscellaneous
2.5% at 55 Pool
Fiscal Year
Ending
June 30
Annual
Pension Cost
(APC)
Percentage
of APC
Contributed
Net Pension
Obligation
(Asset)
2012 $160,777 73% $(87,211)
2013 $165,116 74% $(43,606)
2014 $167,804 74% 0
10. OTHER POSTEMPLOYMENT BENEFITS
PARSAC provides post-retirement health care benefits for employees who satisfy the requirements for
retirement under CalPERS (attained age 50 with 5 years of service). PARSAC currently pays 100% of the
medical premium and 80% of the dependent’s premium for active and retired employees.
PARSAC’s annual other post-employment benefit (OPEB) cost (expense) is calculated based on the annual
required contribution of the employer (ARC), an amount actuarially determined in accordance with the
parameters of GASB Cod. Sec. P50.108.109. The ARC represents a level of funding that, if paid on an ongoing
basis, is projected to cover normal costs each year and amortize any unfunded actuarial liabilities (or funding
excess) over a period not to exceed thirty years.
The following table shows the components of PARSAC’s annual OPEB cost for the year, the amount actually
contributed to the plan, and changes in PARSAC’s net OPEB obligation:
Annual required contribution $ 60,492
Adjustment to annual required contribution -
Annual OPEB cost
Contributions made 60,492
Change in net OPEB obligation 0
Net OPEB obligation – beginning of year 0
Net OPEB obligation – end of year $ 0

32
PARSAC’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB
obligation for the three years ended June 30, 2014 was as follows:
Fiscal Year
Ended
Annual
OPEB Cost
Percentage of
Annual OPEB Cost
Contributed
Net OPEB
Asset
June 30, 2012 $57,469 100% $ -
June 30, 2013 $59,716 100% $ -
June 30, 2014 $60,492 100% $ -
As of July 1, 2011, the most recent actuarial valuation date, the actuarial accrued liability for benefits was
$631,136, and the actuarial value of assets was $328,764, resulting in an unfunded actuarial accrued liability
(UAAL) of $302,372. The covered payroll (annual payroll of active employees covered by the Plan) was
$546,384, and the ratio of the UAAL to the covered payroll was 55.3%.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions
about the probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of
the plan and the annual required contributions of the employer are subject to continual revision as actual
results are compared with past expectations and new estimates are made about the future. The schedule of
funding progress, shown above, presents multiyear trend information about whether the actuarial value of
plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits.
Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as
understood by the employer and the plan members) and include the types of benefits provided at the time of
each valuation and the historical pattern of sharing the benefit costs between the employer and plan members
to that point. The actuarial methods and assumptions used include techniques that are designed to reduce
the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent
with the long-term perspective of the calculations.
In the July 1, 2011 actuarial valuation, the entry age normal cost method was used. The actuarial assumptions
include a 7.50 percent investment rate (net of administrative expenses), which is a blended rate of the
expected long-term investment returns on plan assets and on the employer’s own investments calculated
based on the funded level of the plan on the valuation date, and an annual healthcare cost trend rate of 9
percent initially, reduced by decrements to an ultimate rate of 4.5 percent after 8 years. Both rates include a
3.25 percent inflation assumption. The actuarial value of assets was determined using techniques that spread
the effects of short-term volatility in the market value of investments over a five-year period. The UAAL
is being amortized as a level percentage of projected payroll on an open basis. The remaining amortization
period at June 30, 2014, was 26 years.
11. JOINT POWERS AGREEMENT
PARSAC participates in joint ventures under several Joint Powers Agreements (JPA) with Local Agency
Workers’ Compensation Excess JPA (LAWCX), Employment Risk Management Authority (ERMA) and
California State Association of Counties Excess Insurance Authority (CSAC-EIA). The relationship is such
that LAWCX, ERMA and CSAC-EIA are not component units of PARSAC for financial reporting purposes.

ERMA arranges for and provides up to $975,000 employment practices liability coverage in excess of the
self-insured retention while CSAC-EIA provides $34 million excess liability insurance coverage (including
employment practices) above PARSAC’s $1 million retention. LAWCX provides excess workers’
compensation insurance coverage for losses in excess of $500,000 up to statutory limits.
ERMA, CSAC-EIA and LAWCX are governed by Boards with member agency representation. Their
respective Boards control the operations, including selection of management and approval of operating
budgets, independent of any influence by the member agencies beyond their representation on the board.
Each member agency pays a premium commensurate with the level of coverage requested and shares
surpluses and deficits proportionate to their participation. Complete financial statements of ERMA, CSAC-
EIA and LAWCX may be obtained from each agency, respectively.
LAWCX CSAC-EIA ERMA
Purpose To self-insure and
pool excess workers’
compensation losses
To provide coverage relating to
workers' compensation, general
liability, medical malpractice,
property and employee medical plans
To provide
employment liability
coverage to California
public entities
Participants 22 municipalities, 10 joint
powers authorities, and
one special district
54 counties and 238 public entities
including cities, school districts,
special districts and other joint
powers authorities
10 joint powers
authorities
Governing
Board
Consisting of one
member from each
participating agency
Consisting of one member from each
participating member county and
seven members elected by the public
entity membership.
Consisting of one
member from each
participating agency
Payments for
the Current
Year
$587,538 $702,196 $990,825
Condensed Financial Information
LAWCX
June 30, 2013*
CSAC-EIA
June 30, 2013*
ERMA
June 30, 2013*
Total Assets $ 71,812,040 $ 588,152,525 $ 29,267,797
Total Liabilities $ 45,119,273 $ 469,537,129 $ 9,521,772
Net Assets 26,692,767 118,615,396 19,746,025
Total Liabilities and Net Assets $ 71,812,040 $ 588,152,525 $ 29,267,797
Revenues $ 10,541,824 $ 538,870,150 $ 6,404,961
Expenses 9,999,089 525,806,574 3,883,681
Change in Net Assets $ 542,735 $ 13,063,576 $ 2,521,280
* Most recent information available.
12. CONTINGENCIES
PARSAC is subject to legal proceedings and claims which arise in the ordinary course of business. In the
opinion of management, the amount of ultimate liability with respect to these actions will not materially affect
the financial position or results of operations of PARSAC.

34
PUBLIC EMPLOYEES RETIREMENT SYSTEM
SCHEDULE OF FUNDING PROGRESS
Valuation
Date
Entry Age
Normal Accrued
Liability
Actuarial Value
of Assets
Unfunded
Actuarial
Accrued
Liability
(UAAL)
Funded
Status
Annual
Covered
Payroll
UAAL
as a
Percentage
of Payroll
2010 $1,972,910,641 $1,603,482,152 $369,428,489 81.3% $352,637,380 104.8%
2011 $2,135,350,204 $1,724,200,585 $411,149,619 80.8% $350,121,750 117.4%
2012 $2,254,622,362 $1,837,489,422 $417,132,940 81.5% $339,228,272 123.0%
PERS information presented above was the most current available at the time of publication.
OTHER POSTEMPLOYMENT BENEFITS (OPEB)
SCHEDULE OF FUNDING PROGRESS
Fiscal
Year
Ended
Actuarial
Valuation
Date
Actuarial
Value of
Assets
Actuarial
Accrued
Liability
(AAL)
Unfunded
Actuarial
Accrued
Liability
(UAAL)
Funded
Ratio
Covered
Payroll
UAAL as a
Percentage
of Covered
Payroll
6/30/2012 1/1/2011 $112,739 $524,411 $411,672 21.5% $489,274 84.1%
6/30/2013 1/1/2011 $231,974 $576,828 $344,854 40.2% $505,175 68.3%
6/30/2014 1/1/2011 $328,764 $631,136 $302,372 52.1% $546,384 55.3%
REQUIRED SUPPLEMENTARY INFORMATION

The following tables illustrate how PARSAC’s earned revenue (net of reinsurance) and
investment income compare to related costs of loss (net of loss assumed by reinsurers)
and other expenses assumed by the Program for its most current ten year period. The
claims development information is presented on an undiscounted basis; however, all claims
liabilities reported in the basic financial statements are on a discounted basis.
The rows of the tables are defined as follows:
(1) This line shows the total of each fiscal year’s earned deposit premiums and
cumulative investment income less ceded (excess insurance cost) to arrive at net
earned contribution.
(2) This line shows each fiscal year’s other operating costs of the Program including
overhead and loss adjustment expenses not allocable to individual claims.
(3) This line shows the cumulative Retrospective Premium Adjustment attributed to
the program year.
(4) This line shows the Program’s gross incurred losses and allocated loss adjustment
expense, losses assumed by reinsurers, and net incurred losses and loss
adjustment expense (both paid and accrued) as originally reported at the end of
the year in which the event that triggered coverage occurred (called program
year).
(5) This section of rows shows the cumulative net amounts paid as of the end of
successive years for each program year.
(6) This line shows the latest reestimated amount of losses assumed by reinsurers for
each program year.
(7) This section of rows shows how each program year’s net amount of losses
increased or decreased as of the end of successive years. (This annual
reestimation results from new information received on known losses, reevaluation
of existing information on known losses, and emergence of new losses not
previously known.)
(8) This line compares the latest reestimated net incurred losses amount to the
amount originally established (line 3) and shows whether this latest estimate of
losses is greater or less than originally thought. As data for individual program
years mature, the correlation between original estimates and reestimated amounts
is commonly used to evaluate the accuracy of net incurred losses currently
recognized in less mature program years. The columns of the table show data for
successive program years.
CLAIMS
DEVELOPMENT
INFORMATION
June 30, 2014
SUPPLEMENTARY INFORMATION

36
2004/20052005/20062006/20072007/20082008/20092009/20102010/20112011/20122012/20132013/2014
1RequiredContribution,
InterestandCeded:
EarnedContribution$4,544,426$5,045,646$5,626,651$6,857,856$6,765,098$6,151,209$5,611,397$5,170,965$5,018,835$5,444,995
InvestmentIncome292,980600,230743,162518,971266,716183,23647,23747,42912,46046,006
Ceded2,163,4962,178,7872,288,2782,639,1072,252,2362,150,7012,076,8351,826,0291,763,6531,693,021
NetEarned$2,673,910$3,467,089$4,081,535$4,737,720$4,779,578$4,183,834$3,581,799$3,392,365$3,267,642$3,797,980
2UnallocatedExpenses$810,181$714,835$689,304$663,185$829,663$823,872$951,412$912,830$1,032,129$1,193,577
3CumulativeRetrospective
PremiumAdjustment
(2,801,792)579,766612,62240,725
4EstimatedIncurredClaims
andExpense
EndofYear$3,103,4963,268,787$3,561,278$4,496,107$4,011,927$3,819,701$4,206,904$3,322,691$3,055,557$2,995,750
Ceded2,163,4962,178,7872,288,2782,639,1072,252,2362,150,7012,076,8351,826,0291,763,6531,693,021
NetIncurred$940,000$1,090,000$1,273,000$1,857,000$1,759,691$1,669,000$2,130,069$1,496,662$1,291,904$1,302,729
5CumulativePaid
EndofProgramYear$43,800$38,806$15,000$75,161$(3,466)$10,188$376,100$76,244$58,331$6,239
OneYearLater$95,217$255,562$187,394$195,344$70,055$107,203$1,742,107$113,202$968,393
TwoYearsLater$1,680,652$669,343$363,105$1,532,285$381,948$243,228$2,553,601$331,565
ThreeYearsLater$3,518,938$1,210,427$390,566$3,319,428$747,638$420,070$4,108,727
FourYearsLater$5,406,858$1,287,936$1,113,062$3,523,205$695,347$674,124
FiveYearsLater$5,422,657$1,436,847$1,108,643$3,708,156$814,976
SixYearsLater$5,422,657$1,585,675$1,108,643$3,748,430
SevenYearsLater$5,422,657$1,584,175$1,138,643
EightYearsLater$5,422,657$1,677,375
NineYearsLater$5,460,073
6ReestimatedCededClaims
andExpenses
$3,231,113$452,526$253,798$895,447$575,777$393,874$5,533,967$12,892$367,830
7ReestimatedNetIncurred
ClaimsandExpenses:
EndofProgramYear$940,000$1,090,000$1,273,000$1,857,000$1,759,691$1,669,000$2,130,069$1,496,662$1,291,904$1,302,729
OneYearLater$1,454,000$1,828,671$1,925,000$3,579,520$2,267,000$1,622,434$4,504,407$1,010,115$2,232,323
TwoYearsLater$2,990,591$1,871,000$1,426,997$3,879,000$2,211,303$1,218,786$4,355,597$1,252,773
ThreeYearsLater$6,083,000$1,752,671$1,029,000$3,831,192$1,528,503$970,136$4,537,713
FourYearsLater$5,995,968$1,588,000$1,202,735$3,859,545$1,105,910$932,997
FiveYearsLater$5,423,000$1,862,036$1,146,815$3,779,651$776,688
SixYearsLater$5,469,477$1,637,144$1,139,102$3,773,707
SevenYearsLater$5,422,657$1,611,507$1,123,643
NineYearsLater$5,456,294
8
Increase(Decrease)in
EstimatedIncurredClaims
ExpensefromEndof
ProgramYear$4,516,294$484,111$(149,357)$1,916,707$(983,003)$(736,003)$2,407,644$(243,889)$940,419$-
CLAIMS DEVELOPMENT INFORMATION
Liability Program - June 30, 2014

2004/20052005/20062006/20072007/20082008/20092009/20102010/20112011/20122012/20132013/2014
1RequiredContribution,
InterestandCeded:
Earned$3,616,579$4,262,748$4,568,679$4,449,455$4,139,075$4,236,980$4,018,631$4,019,138$4,374,293$4,616,107
InvestmentIncome460,682435,762506,211370,979191,655116,92280,90735,67045,5134,810
Ceded665,436962,808992,973492,928585,087533,133466,973504,676569,381587,538
NetEarned$3,411,825$3,735,702$4,081,917$4,327,506$3,745,643$3,820,769$3,632,565$3,550,132$3,850,425$4,033,379
2UnallocatedExpenses$426,334$458,326$508,782$637,600$696,170$701,539$697,023$774,346$861,269$1,024,128
3CumulativeRetrospective
PremiumAdjustment
$479,302
4EstimatedIncurredClaims
andExpenses
EndofYear$2,638,436$2,696,808$2,824,973$2,913,928$3,105,087$3,047,133$3,116,913$2,947,775$3,177,578$3,166,911
Ceded665,436962,808992,973492,928585,087533,133466,973504,676569,381587,538
NetIncurred$1,973,000$1,734,000$1,832,000$2,421,000$2,520,000$2,514,000$2,649,940$2,443,099$2,608,197$2,579.373
5CumulativePaid
EndofProgramYear$133,146$122,134$209,397$188,276$317,371$219,656$327,068$259,023$450,566$506,452
OneYearLater$319,556$418,870$335,394$418,318$583,584$933,685$1,021,428$568,269$575,029
TwoYearsLater$431,970$600,144$433,593$656,480$990,616$1,701,452$1,600,764$704,749
ThreeYearsLater$516,764$668,837$443,898$872,320$1,411,666$2,225,615$2,063,292
FourYearsLater$655,523$762,489$446,361$974,602$1,584,153$2,446,438
FiveYearsLater$655,667$910,942$449,231$1,117,677$1,957,976
SixYearsLater$669,062$899,127$454,407$1,202,194
SevenYearsLater$679,877$899,778$455,391
EightYearsLater$698,434$1,013,933
NineYearsLater$71,445
6ReestimatedCededClaims
andExpenses
$225,408$512,224$36,373$1,172,705$133,948$2,149,332
7ReestimatedNetIncurred
ClaimsandExpenses:
EndofProgramYear$1,973,000$1,734,000$1,832,000$2,421,000$2,520,000$2,154,000$2,649,940$2,443,099$2,608,197$2,579,373
OneYearLater$1,570,000$1,783,000$1,691,000$1,944,000$1,832,000$3,000,918$2,896,938$2,023,709$1,973,948
TwoYearsLater$1,245,000$1,420,000$1,111,000$1,735,000$2,058,826$3,054,650$3,127,162$2,027,324
ThreeYearsLater$1,203,000$1,359,000$896,000$1,847,066$2,331,346$3,133,259$3,988,341
FourYearsLater$982,000$1,213,000$795,754$1,785,062$2,793,574$3,057,743
FiveYearsLater$884,000$1,178,825$618,218$1,750,385$3,112,457
SixYearsLater$1,049,911$1,163,883$600,656$1,818,892
SevenYearsLater$1,039,898$1,175,358$565,368
NineYearsLater$962,161
8
Increase(Decrease)in
EstimatedIncurredClaims
ExpensefromEndof
ProgramYear$(1,010,839)$(460,174)$(1,266,632)$(602,108)$592,457$543,743$1,338,401$(415,775)$(634,249)$-
CLAIMS DEVELOPMENT INFORMATION
Workers’ Compensation Program - June 30, 2014

38
2014 2013
Unpaid Claims and Claims Adjustment Expenses,
Beginning of Fiscal Year $ 4,796,053 $ 6,578,887
Incurred Claims and Claims Adjustment
Expenses:
Provision for Covered Events of
Current Fiscal Year 1,302,729 1,291,904
Change in Provision for Covered Events of
Prior Fiscal Years 727,987 (1,613,526)
Total Incurred Claims and
Claims Adjustment Expense 2,030,716 (321,622)
Payments:
Claims and Claims Adjustment Expenses
Attributable to Covered Events of
Current Fiscal Year 6,239 58,331
Prior Fiscal Years 2,235,839 1,402,881
Total Payments 2,242,078 1,461,212
Total Unpaid Claims and Claims Adjustment
Expenses, End of Fiscal Year $ 4,584,691 $ 4,796,053
The components of the unpaid claims and claim adjustment expenses as of June 30,
2014 and 2013 were as follows:
2014 2013
Claims Reserves $ 2,398,873 $ 2,304,289
Claims Incurred But Not Reported (IBNR) 1,731,128 2,168,598
Unallocated Loss Adjustment Expenses (ULAE) 454,690 323,166
$ 4,584,691 $ 4,796,053
RECONCILIATION
OF CLAIMS
LIABILITIES BY TYPE
OF CONTRACT
Liability Program
For the Years Ended
June 30, 2014 and 2013

2014 2013
Unpaid Claims and Claims Adjustment Expenses,
Beginning of Fiscal Year $ 8,895,388 $ 8,056,841
Incurred Claims and Claims Adjustment
Expenses:
Provision for Covered Events of
Current Fiscal Year 2,579,373 2,608,197
Change in Provision for Covered Events of
Prior Fiscal Years 1,676,727 461,422
Total Incurred Claims and Claims Adjustment
Expense 4,256,100 3,069,619
Payments:
Current Fiscal Year 506,452 450,566
Prior Fiscal Years 2,548,032 1,780,506
Total Payments 3,054,484 2,231,072
Total Unpaid Claims and Claims Adjustment
Expenses, End of Fiscal Year $ 10,097,004 $ 8,895,388
The components of the unpaid claims and claim adjustment expenses as of June 30,
2014 and 2013 were as follows:
2014 2013
Claims Reserves $ 5,536,725 $ 5,197,284
Claims Incurred But Not Reported (IBNR) 3,859,707 3,162,694
Unallocated Loss Adjustment Expenses (ULAE) 700,572 535,410
$ 10,097,004 $ 8,895,388
RECONCILIATION
OF CLAIMS
LIABILITIES BY TYPE
OF CONTRACT
Workers’
Compensation Program
For the Years Ended
June 30, 2014 and 2013

40
Liability
Workers’
Comp.
Property/
Bond
Building
2014
Total
ASSETS
Current Assets:
Cash and Cash Equivalents $ 383,304 $ 663,879 $ 13,148 $ 5,052 $ 1,065,383
Interest Receivable 38,676 47,271 85,947
Member Receivable 328 433,708 60,551 494,587
Excess Receivable 606,449 606,449
ERMA Dividend Receivable 932,190 932,190
Due From Other Funds 72,661 48,441 121,102
Prepaid Expenses 345 251 34,264 34,860
Total Current Assets 1,427,504 1,799,999 107,963 5,052 3,340,518
Non-Current Assets:
Investments 15,410,197 19,106,461 222,363 34,739,021
Capital Assets, Net 10,436 10,436 775,939 796,811
Total Non-Current
Assets
15,420,633 19,116,897 60,550 998,302 35,596,382
Total Assets 16,848,137 20,916,896 168,513 1,003,354 38,936,900
LIABILITIES & NET POSITION
Current Liabilities:
Accounts Payable 24,630 55,612 767 779 81,788
Accrued Expenses 76,286 55,481 6,935 138,702
Committee Training Stipend
Payable
8,393 6,104 763 15,260
Due to Other Funds 121,102 121,102
Retrospective Premium
Adjustment Payable
1,314,915 1,198,160 2,513,075
Unpaid Claims and Adjustment
Expenses
1,798,204 2,374,945 4,173,149
Total Current
Liabilities
3,222,428 3,714,771 129,567 779 7,067,545
Non-Current Liabilities:
Unpaid Claims and Claims
Adjustment Expenses
2,786,487 7,722,059 10,508,546
Total Non-Current
Liabilities
2,786,487 7,746,528 10,533,015
Total Liabilities 6,008,915 11,461,299 129,567 779 17,600,560
Net Position:
Invested in Capital Assets 10,436 10,436 775,939 796,811
Unrestricted 10,828,786 9,445,161 38,946 226,636 20,539,529
Total Net Position $10,839,222 $ 9,455,597 $ 38,946 $ 1,002,575 $ 21,336,340
COMBINING
STATEMENT OF NET
POSITION
June 30, 2014

Liability
Workers’
Comp.
Property/
Bond
Building
2014
Total
Operating Revenues:
Premium Contributions $ 4,985,808 $ 4,855,533 $ 1,558,669 $ $11,400,010
Retrospective Adjustment (1,000,000) (1,000,000) (2,000,000)
CARMA Dividend 1,289,022 1,289,022
ERMA Dividend 932,190 932,190
Other 7,948 2,820 11 10,779
Total Operating Revenues 6,214,968 3,858,353 1,558,680 11,632,001
Operating Expenses:
Claims Paid 3,054,484 2,242,078 5,296,562
Change in Claims Liabilities (211,362) 1,201,616 990,254
Excess Insurance 1,693,021 587,538 1,500,018 3,780,577
Program Administration 245,267 331,103 576,370
Risk Management 233,324 166,877 400,201
Professional Fees 78,999 63,635 1,874 144,508
Salaries 513,648 373,562 46,695 933,905
Travel and Meetings 40,502 29,421 3,689 73,612
CARMA Dividend Refunds 382,087 382,087
Facility Expense 35,085 25,516 3,190 63,791
Other General and
Administrative Expenses
46,751 34,015 4,252 85,018
Total Operating Expenses 6,111,806 5,055,361 1,559,718 12,726,885
Operating Income (Loss) 103,162 (1,197,008) (1,038) (1,094,884)
Non-Operating Revenues (Expenses):
Investment Income 203,132 248,272 451,404
Facility Expense, Net (29,824) (29,824)
Total Non-Operating
Revenues (Expenses)
203,132 248,272 (29,824) 421,580
Change in Net Position 306,294 (948,736) (1,038) (29,824) (673,304)
Net Position, Beginning ofYear 10,532,928 10,404,333 39,984 1,032,399 22,009,644
Net Position, End ofYear $10,839,222 $ 9,455,597 $ 38,946 $ 1,002,575 $21,336,340
COMBINING
STATEMENT
OF REVENUES,
EXPENSES AND
CHANGES IN NET
POSITION
For The Year Ended
June 30, 2014

42
INDEPENDENT AUDITOR’S REPORT ON
INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER
MATTERS BASED ON AN AUDIT OF FINANCIAL
STATEMENTS PERFORMED IN ACCORDANCE
WITH GOVERNMENT AUDITING STANDARDS
Board of Directors and Members
Sacramento, California
We have audited in accordance with the auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards issued by the
Comptroller General of the United States, the financial statements of Public Agency Risk Sharing Authority
of California (PARSAC) as of and for the year ended June 30, 2014, and the related notes to the financial
statements, which collectively comprise PARSAC’s basic financial statements, and have issued our report
thereon dated October 23, 2014.
Internal Control Over Financial Reporting
In planning and performing our audit of the financial statements, we considered PARSAC’s internal control
over financial reporting (internal control) to determine the audit procedures that are appropriate in the
circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose
of expressing an opinion on the effectiveness of PARSAC’s internal control. Accordingly, we do not express an
opinion on the effectiveness of PARSAC’s internal control.
A deficiency in internal control exists when the design or operation of a control does not allow management
or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct
misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in
internal control such that there is a reasonable possibility that a material misstatement of PARSAC’s financial
statements will not be prevented, or detected and corrected on a timely basis. A significant deficiency is a
deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet
important enough to merit attention by those charged with governance.
Our consideration of internal control was for the limited purpose described in the first paragraph of this
section and was not designed to identify all deficiencies in internal control that might be material weaknesses
or, significant deficiencies. Given these limitations, during our audit, we did not identify any deficiencies in
internal control that we consider to be material weaknesses. However, material weaknesses may exist that
have not been identified.
Compliance and other Matters
As part of obtaining reasonable assurance about whether PARSAC’s financial statements are free of material
misstatement, we performed tests of its compliance with certain provisions of laws, regulations and contracts,
noncompliance with which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an objective of our
audit and, accordingly we do not express such an opinion. The results of our tests disclosed no instances of
noncompliance that are required to be reported under Government Auditing Standards.
Purpose of this Report
The purpose of this report is solely to describe the scope of our testing of internal control and compliance and
the results of that testing, and not to provide an opinion on the effectiveness of PARSAC’s internal control or
on compliance. This report is an integral part of an audit performed in accordance with Government Auditing
Standards in considering PARSAC’s internal control and compliance. Accordingly, this communication is not
suitable for any other purpose.

2014 Annual Report

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2014 Annual Report