At June 30, 2020, the District's proportionate share was 0.5488% for PSRS and 0.4788% for PEERS. For the year ended June 30, 2021, the District recognized a pension expense of $7,935,382 for PSRS and $902,275 for PEERS, its proportionate share of the total pension expense. - 51 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions - Continued At June 30, 2021, the District reported deferred outflows of resources from the following sources related to PSRS and PEERS pension benefits: Deferred outflows of resources PSRS PEERS District Total Balance of deferred outflows due to: Differences between expected and actual experience $ 798,917 $ - $ 798,917 Changes in assumptions 4,026,240 47,337 4,073,577 Net difference between projected and actual earnings on pension plan investments 5,271,338 581,299 5,852,637 Changes in proportion and differences between District contributions and proportionate share of contributions 404,618 - 404,618 Employer contributions subsequent to the measurement date 4,119,081 587,375 4,706,456 Total $ 14,620,194 $ 1,216,011 $ 15,836,205 At June 30, 2021 the District reported deferred inflows of resources from the following sources related to PSRS and PEERS pension benefits: Deferred inflows of resources PSRS PEERS District Total Balance of deferred inflows due to: Differences between expected and actual experience $ 2,009,388 $ 69,392 $ 2,078,780 Changes in proportion and differences between District contributions and proportionate share of contributions 151,588 102,479 254,067 Total $ 2,160,976 $ 171,871 $ 2,332,847 - 52 -

SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions - Continued At June 30, 2021, the District reported deferred outflows of resources from the following sources related to PSRS and PEERS pension benefits: Deferred outflows of resources PSRS PEERS District Total Balance of deferred outflows due to: Differences between expected and actual experience $ 798,917 $ - $ 798,917 Changes in assumptions 4,026,240 47,337 4,073,577 Net difference between projected and actual earnings on pension plan investments 5,271,338 581,299 5,852,637 Changes in proportion and differences between District contributions and proportionate share of contributions 404,618 - 404,618 Employer contributions subsequent to the measurement date 4,119,081 587,375 4,706,456 Total $ 14,620,194 $ 1,216,011 $ 15,836,205 At June 30, 2021 the District reported deferred inflows of resources from the following sources related to PSRS and PEERS pension benefits: Deferred inflows of resources PSRS PEERS District Total Balance of deferred inflows due to: Differences between expected and actual experience $ 2,009,388 $ 69,392 $ 2,078,780 Changes in proportion and differences between District contributions and proportionate share of contributions 151,588 102,479 254,067 Total $ 2,160,976 $ 171,871 $ 2,332,847 - 52 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of Resources Related to Pensions - Continued Amounts reported as deferred outflows of resources resulting from contributions subsequent to the measurement date of June 30, 2020, will be recognized as a reduction to the net pension liability in the year ended June 30, 2022. Other amounts reported as collective deferred (inflows)/outflows of resources are to be recognized in pension expense as follows: Year ending June 30, PSRS PEERS District Total 2022 $ 1,414,793 $ (40,717) $ 1,374,076 2023 3,031,393 113,456 3,144,849 2024 2,460,985 200,365 2,661,350 2025 1,427,445 183,661 1,611,106 2026 5,520 - 5,520 $ 8,340,136 $ 456,765 $ 8,796,901 Actuarial Assumptions Actuarial valuations of the Systems involve assumptions about probability of occurrence of events far into the future in order to estimate the reported amounts. Examples include assumptions about future employment, salary increases, and mortality. Amounts determined regarding the net pension liability are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The Board of Trustees adopts actuarial assumptions, each of which individually represents a reasonable long-term estimate of anticipated experience for the Systems, derived from experience studies conducted every fifth year and from Board policies concerning investments and COLAs. The most recent comprehensive experience studies were completed in June 2016. All economic and demographic assumptions were reviewed and updated, where appropriate, based on the results of the studies and effective with the June 30, 2016 valuation. For the June 30, 2017 valuations, the investment rate of return was reduced from 7.75% to 7.60% and the assumption for the annual COLA was updated in accordance with the funding policies amended by the Board of Trustees at their November 2017 meeting. For the June 30, 2018 valuation, the investment rate of return assumption was further reduced from 7.60% to 7.50%. No additional assumption changes have occurred. Significant actuarial assumption and methods are detailed below. For additional information please refer to the Systems’ Comprehensive Annual Financial Report (CAFR). The next experience studies are scheduled for 2021. - 53 -

For additional information please refer to the Systems’ Comprehensive Annual Financial Report (CAFR). The next experience studies are scheduled for 2021. - 53 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Actuarial Assumptions - Continued Significant actuarial assumptions and other inputs used to measure the total pension liability: Measurement Date: June 30, 2020 Valuation Date: June 30, 2020 Expected Return on Investments: 7.50%, net of investment expenses and including 2.25% inflation Inflation: 2.25% Total Payroll Growth PSRS: 2.75% per annum, consisting of 2.25% inflation, 0.25% real wage growth due to the inclusion of active health care costs in pensionable earnings, and 0.25% of real wage growth due to productivity. Total Payroll Growth PEERS: 3.25% per annum, consisting of 2.25% inflation, 0.50% real wage growth due to the inclusion of active health care costs in pensionable earnings, and 0.50% of real wage growth due to productivity. Future Salary Increases PSRS: 3.00% - 9.50%, depending on service and including 2.25% inflation, 0.25% real wage growth due to the inclusion of active health care costs in pensionable earnings, and 0.25% of real wage growth due to productivity, and real wage growth for merit, promotion and seniority of 0.25% to 6.75%. Future Salary Increases PEERS: 4.00% - 11.00%, depending on service and including 2.25% inflation, 0.50% real wage growth due to the inclusion of active health care costs in pensionable earnings, and 0.50% of real wage growth due to productivity. and real wage growth for merit, promotion and seniority of 0.75% to 7.75%. Cost of Living Increases PSRS & PEERS: The annual COLA assumed in the valuation increases from 1.35% to 1.65% over six years, beginning January 1, 2022. The COLA reflected for January 1, 2021 is 2.00%, in accordance with the actual COLA approved by the Board. This COLA assumption reflects an assumption that general inflation will increase from 1.95% to a normative inflation assumption of 2.25% over six years. It is also based on the current policy of the Board to grant a COLA on each January 1 as follows: - 54 -

This COLA assumption reflects an assumption that general inflation will increase from 1.95% to a normative inflation assumption of 2.25% over six years. It is also based on the current policy of the Board to grant a COLA on each January 1 as follows: - 54 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Actuarial Assumptions - Continued If the June to June change in the CPI-U is less than 2% for one or more consecutive one-year periods, a COLA increase of 2% will be granted when the cumulative increase is equal to or greater than 2%, at which point the cumulative increase in the CPI-U will be reset to zero. For the following year, the starting CPI-U will be based on the June value immediately preceding the January 1 at which the 2% cost-of-living increase is granted. If the June to June change in the CPI-U is greater than or equal to 2%, but less than 5%, a COLA increase of 2% will be granted. If the June to June change in the CPI-U is greater than or equal to 5%, a COLA increase of 5% will be granted. If the CPI decreases, no COLA is provided. The COLA applies to service retirements and beneficiary annuities. The COLA does not apply to the benefits for in-service death payable to spouses (where the spouse is over age 60), and does not apply to the spouse with children pre-retirement death benefit, the dependent children pre- retirement death benefit, or the dependent parent death benefit. The total lifetime COLA cannot exceed 80% of the original benefit. PSRS members receive a COLA on the second January after retirement, while PEERS members receive a COLA on the fourth January after retirement. Mortality Assumptions  Actives PSRS: RP 2006 White Collar Employee Mortality Table, multiplied by an adjustment factor of 0.75 at all ages for both males and females, with static projection using the 2014 SSA Improvement Scale to 2028.  Actives PEERS: RP 2006 Total Dataset Employee Mortality Table, multiplied by an adjustment factor of 0.75 at all ages for both males and females, with static projection using the 2014 SSA Improvement Scale to 2028.  Non-Disabled Retirees, Beneficiaries, and Survivors PSRS: RP 2006 White Collar Mortality Tables with plan-specific experience adjustments and static projection to 2028 using the 2014 SSA Improvement Scale.  Non-Disabled Retirees, Beneficiaries, and Survivors PEERS: RP 2006 Total Dataset Mortality Table with plan-specific experience adjustments and static projection to 2028 using the 2014 SSA Improvement Scale. - 55 -

PSRS members receive a COLA on the second January after retirement, while PEERS members receive a COLA on the fourth January after retirement. Mortality Assumptions  Actives PSRS: RP 2006 White Collar Employee Mortality Table, multiplied by an adjustment factor of 0.75 at all ages for both males and females, with static projection using the 2014 SSA Improvement Scale to 2028.  Actives PEERS: RP 2006 Total Dataset Employee Mortality Table, multiplied by an adjustment factor of 0.75 at all ages for both males and females, with static projection using the 2014 SSA Improvement Scale to 2028.  Non-Disabled Retirees, Beneficiaries, and Survivors PSRS: RP 2006 White Collar Mortality Tables with plan-specific experience adjustments and static projection to 2028 using the 2014 SSA Improvement Scale.  Non-Disabled Retirees, Beneficiaries, and Survivors PEERS: RP 2006 Total Dataset Mortality Table with plan-specific experience adjustments and static projection to 2028 using the 2014 SSA Improvement Scale. - 55 - SCHOOL DISTRICT OF CLAYTON NOTES TO THE FINANCIAL STATEMENTS June 30, 2021 NOTE G – RETIREMENT PLANS - CONTINUED Actuarial Assumptions - Continued  Disabled Retirees PSRS & PEERS: RP 2006 Disabled Retiree Mortality Tables with static projection to 2028 using the 2014 SSA Improvement Scale. Changes in Actuarial Assumptions and Methods There have been no assumption changes since the June 30, 2018 valuations. Fiduciary Net Position: The Systems issue a publicly available financial report (CAFR) that can be obtained at www.psrs-peers.org. Expected Rate of Return The long-term expected rate of return on investments was determined in accordance with Actuarial Standard of Practice (ASOP) No. 27, Selection of Economic Assumptions for Measuring Pension Obligations. ASOP No. 27 provides guidance on the selection of an appropriate assumed rate of return. The long-term expected rate of return on the Systems’ investments was determined using a building-block method in which best-estimate ranges of expected future real rates of returns (expected returns, net of investment expense and inflation) are developed for each major asset class. These ranges are combined to produce the long-term expected rate of return by weighting the expected future real rates of return by the target asset allocation percentage and by adding expected inflation. Best estimates of arithmetic real rates of return for each major asset class included in the Systems’ target allocation as of June 30, 2020 are summarized below. - 56 -