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<br />CITY OF ARDEN HILLS, MINNESOTA <br />NOTES TO THE FINANCIAL STATEMENTS <br />DECEMBER 3] <br /> <br />. Note 3: DETAILED NOTES ON ALL FUl\'DS <br /> <br />Cash balances of the City's funds are combined (pooled) dilllves' <br />au~orized by Minnesota statu:es. Each fund's portion ojihis"4'lo~l; 1,r <br />as cash and cash eqUJvalents. . For purposes of IdennfYij1g llie s 0 <br />categorized as follows: <br /> <br /> <br />xtA. 1...,ailRmvestments <br />is ~edt4t e :.lti~l s tements <br />e /p;b1~~ the ~ces e <br /> <br />Deposits <br /> <br />In accordance with Minnesota statutes and as authorized by the Council, the City maintains deposits at those <br />depository banks, all of which are members of the Federal Reserve System. <br /> <br />Minnesota statutes require that all City deposits be protected by insurance, surety bond or collateral; The market <br />value of collateral pledged must equal 110 percent of the deposits not covered by insurance or bonds (140 percent in <br />the case of mortgage notes pledged). <br /> <br />Authorized collateral includes the legal investments described below, as well as certain fIrst mortgage notes, and <br />certain other State or local government obligations. Minnesota statutes require that secnrities pledged as collateral <br />be held in safekeeping by the City or in a fInancial institution other than that furnishing the collateral; <br /> <br />At year end, the City has deposits with a bank and a book value of$3,291,7]3. Of the bank balance, $2,243,000 was <br />covered by federal depository insurance. The remaining balance of$I,048,713 was covered by collateral held by the <br />City's agent in the City's name. <br /> <br />Investments <br /> <br />. <br /> <br />Investments are carried at fair value. Investment and dividend income are recognized as revenue when earned. <br /> <br />Types of Investments <br /> <br />Credit <br />Qualiryl <br />Ratiogs (1) <br /> <br />Segmented <br />Time <br />Distribution (2) <br /> <br />Fair Value <br />and <br />Carrying <br />Amount <br /> <br />Nonpooled investments <br />Government Securities <br /> <br />N1A <br />N/A <br /> <br />1 to 3 years <br />more than 3 years <br /> <br />$ 807,345 <br />2,656,410 <br /> <br />Total Government Securities <br /> <br />3,463,755 <br /> <br />Treasury strips <br /> <br />NIA <br /> <br />more than 3 years <br /> <br />724,879 <br /> <br />Total nonpooled investments <br /> <br />4,188,634 <br /> <br />Pooled investments <br />Minnesota Municipal Monet Market Fund <br /> <br />P-l <br /> <br />less than 6 months <br /> <br />3,251,4] 4 <br /> <br />Broker money market <br /> <br />N/A <br /> <br />less than 6 months <br /> <br />597,742 <br />3,849,]56 <br />$ 8,037,790 <br /> <br />Total pooled investments <br /> <br />Total investments <br /> <br />. <br /> <br />1. <br />2. <br />N/A <br /> <br />Ratiogs are provided by Moody's where applicable to indicate associated credit risk. <br />Interest rate risk is disclosed using the segmented time distribntion method. <br />Indicated not applicable or available. <br /> <br />-30- <br />