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2014 Approved Budget
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2014 Approved Budget
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City of Roseville — 2014 Budget <br />Where possible, prepayment funds for long -term debt service shall be invested to ensure a rate of return <br />at least equal to the interest being paid on the bonds. <br />Delegation of Authority <br />The Finance Director is designated as investment officer of the City and is responsible for investment <br />decisions and activities, under the direction of the City Manager. <br />Pr»r1Pno.P <br />The standard of prudence to be applied by the investment officer shall be the "prudent investor" rule. <br />This rule states, "Investments shall be made with judgment and care, under circumstances then <br />prevailing, which persons of prudence, discretion and intelligence exercise in the management of their <br />own affairs, not for speculation, but for investment, considering the probable safety of their capital as <br />well as the probable income to be derived." The prudent investor rule shall be applied in the context of <br />managing the overall portfolio. <br />The investment officer, acting in accordance with written procedures and exercising due diligence, shall <br />not be held personally responsible for a specific security's credit risk or market price changes, provided <br />that these deviations are reported immediately and that appropriate action is taken to control adverse <br />developments. <br />Monitoring and Adjusting the Portfolio <br />The investment officer will routinely monitor the contents of the portfolio, the available markets and the <br />relative values of competing instruments and will adjust the portfolio accordingly. <br />Internal Controls <br />The Finance Director shall establish a system of internal controls, which shall be reviewed annually by <br />an independent auditor. The controls shall be designed to prevent loss of public funds due to fraud, <br />error, misrepresentation, unanticipated market changes, or imprudent actions. Investments shall be done <br />on a pooled funds basis with interest allocated on a cash balance method. Those internal controls shall <br />consist of competitive bids on investments, and division of duties among the staff. <br />❑ Investments made by investment officer <br />❑ Records maintenance by a finance staff member other than investment officer <br />❑ Review and reconciliation by the assistant finance director <br />Portfolio Management <br />Under the Council- adopted Fiscal Policies, it shall be the City's procedure to restrict investments to only <br />Repurchase Agreements with national or state chartered banks, U.S. Treasury and U.S. Government <br />Agencies, Guaranteed Investment Contracts, and Bankers Acceptances. All investments shall carry a <br />minimum credit rating of 'AA'. An exception to these restrictions is permitted with regard to the <br />investment of proceeds received from the 2011 and 2012 bonds due to extenuating economic <br />circumstances and their effect on financial institutions. Repurchase Agreements associated with the <br />bonds can be placed with any bank, bank holding company, savings and loan association, trust company <br />or other financial institution including the trustee or any of its affiliates. The financial institution shall <br />carry a credit rating of `A' or better, and is required to pledge collateral from national or state chartered <br />banks. <br />122 <br />
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