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More evidence that CalPERS’s private equity problem is about CalPERS, not private equity

Last week I wrote about how the California Public Employees’ Retirement System claimed it is unable to track the incentive fees (i.e., carried interest) that it pays to its outside private equity fund managers. My basic message was that either CalPERS officials weren’t telling the truth, or that the nation’s largest public pension system has experienced a massive breakdown in financial controls.

While we continue to wait for a reasonable explanation from CalPERS, a reader points out that not all public pensions suffer from a similar dearth of calculators.

His example was the Texas County & District Retirement System, which invests around 12% of its $25 billion into private equity. In the pension’s comprehensive annual financial report, it explicitly breaks out the amount paid in carried interest to its private equity managers. See below:

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So much for the CalPERS argument that this is a “private equity industry issue” rather than a CalPERS issue…

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