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NOTE 2 — DEPOSITS AND I WESTMEM <br />A. Components. bf Deposits and.lilivestmiWi <br />Cash and investments at year-end consistbfthe followiiing: <br />Depgsits <br />736,093 <br />Investments <br />563,575 <br />Total <br />S 1,293,668 <br />.B: Deposits. <br />lit attcordattce with Minnesota Statutes, the City maintains deposits at financial institutions which are <br />authorized by -:the City Council, including checking accounts and:eertif cates of deposit. <br />The*following is. considered the -most significant risk associated with deposits;. <br />Custodial. Credit Risk —*In the case of deposits, this is the risk. that in the event of a bank failure, the <br />City's deposits may be lost. <br />Minnesota Statutes require that All deposits be protected by federal deposit insurance, corporate surety <br />bond, or. collateral. The market value of collateral pledged must equal l 10 percent of the deposits not. <br />covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes <br />treasury bills, notes; and bonds; issues. of U.S. government agencies;. general obligations. rated "V or <br />better; revenue obligations. rated "AA" or. better; irrevocable standard letters of credit issued.by. the <br />Federal Home Loan Bank; .and certificates of deposit. Minnesota Statutes. require. that securities <br />pledged as collateral. be held 'in .safekeeping in a restricted account at the Federal Reserve. Bank or in <br />an account at a trust department of a commercial bank or other financial institution that is *not owned <br />or .controlled by the financial institution: furnishing the collateral... The Cityhas no additional deposit <br />policies addressing custodiit).creditrisk. <br />At year-end, the carrying amount of the City's deposits was.4730,093, while the balance on the bank. <br />records was $954,268: At D64errlber 31,. 2021, all deposits were fully covered by federal deposit <br />insurance,.surety bonds;-oi by collateral field by the-City's;agent in the City's*name. <br />C. Investments <br />The City has the -following investments at year. -end: <br />Fair Value <br />credit Risk Measurements Interest :Risk — hlaturily Duration in: Ycars <br />_,. InvcurnentTytte Ratine . .Aaencv Usingi ..Less.Th2n.1. 1 to.5 6 to 10 Total <br />Municipal Fonds <br />Nesobabte ccrtiricatcs of deposit <br />Total investments <br />NIR —.Not Rated <br />NIA -Not Applicable. <br />AA Moody's Level <br />NIR NIA Level2 <br />-25- <br />- $ - S 159,056 3 1391056 <br />40,277 S 364,242 $ — 4044519 <br />