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Investment Reporting 2015 Conference of the County Investment Academy Edward A. Dion El Paso County Auditor

Learning Objectives • • • • • •

Investment Reporting Overview Investment Reporting Requirements GASB 31 Reporting for Investments Effective Investment Reporting Benchmarking the Investment Portfolio Suggested Components of an Investment Report • PFIA Compliance Checklist

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General Overview • Fiduciary Responsibility • Accountable Reporting that is  Timely and concise • Focus on your audience • Readability and understandable • Focus on key points of what is  important • Glossary of terms

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Investment Reporting Requirements • Written report no less than quarterly….within a  reasonable time after the end of the period. • Describe overall position as of report date • Jointly prepared and signed by all involved • Summarized by each pooled fund and state Beg MktV,  Additions, Changes, End MktV and Accrued Interest • BKV and MktV of each separately invested asset at the  beginning and end of reporting period by type of asset  and fund type invested

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Investment Reporting Req.‐Cont. • Must state the maturity date of each separately  invested asset that has a maturity date. • Must reflect the account, fund or pooled group from  which investment was acquired • Must include a statement to the effect the  investment portfolio is in compliance as it relates to  (1) the investment policy strategy which defines your  government’s risk tolerance and (2) provisions of the  Public Funds Investment Act.

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Investment Reporting Req.-Cont. •

•

Must include if investing in OTHER THAN money market mutual funds, investment pools or accounts offered by its depository bank in the form of certificates of deposit, or money market accounts or similar accounts Reports shall be formally reviewed at least annually by an independent auditor, and shall be reported to the governing body by that auditor.

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GASB 31 Reporting for Investments •

•

GASB 31 requires reporting investments at fair  value for investments with a remaining  maturity at time of purchase of one year or  more. (Examples:, Agencies, MMMF, Repos)  Revenue is recognized as unrealized gains and  as an expense losses on certain types of  investments with a maturity of more than one  year at time of purchase or “Mark to Market”.  (Previously reported at amortized cost) 

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GASB 31 Reporting for Invest.‐Cont. • Investments which may still be reported  at COST include Savings accounts, Non‐ negotiable CDs and Shares with the  Short Term Investment Pool (STIP).

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GASB 31 Reporting for Invest.‐Cont. Revenue Recognition and Reporting •Under the amortized cost method investment earnings  represent the true interest received minus the prorated  amortization or accretion. •The GASB FV standard consists of two parts: (1) The investment income ‐ accrued  interest from  the coupon in the reporting  period (2) plus or minus the change in the fair value  from  the beginning of the period.)

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GASB 31 Reporting for Invest.‐Cont. •

•

Components of Investment Income: • Interest income • Amortization of Premium  or Accretion of Discount • Realized gains (losses) • Change in fair value FV changes impact income and are reported in the financial  operating statements as follows: • Report all together as “investment income” • Separate and report “interest income” and everything  else as “Change in fair value”

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GASB 31 Reporting for Invest.‐Cont. •

Mark to Market Reporting • Regular disclosure is vital to furthering taxpayer and  market confidence in local government investment  practices. • GASB requires year end reporting investments at fair  value which is also required by state, local, accounting,  and rating agencies. • (GFOA) recommends determining the market value on at  least a quarterly basis. • Values should be obtained from a reputable and  independent source (not the one who sold you the  security).

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Effective Investment Reporting • • •

• • •

Table of contents Transmittal letter‐summarize salient points Utilize graphs, charts or tables (in color if possible)  For example: Distribution of asset types or a  schedule of maturity ranges might be helpful. Focus on simple, clean and uncluttered format  that is easy to read A one page snapshot should be your goal Include all required information in the report plus  any that would better inform the governing body  (i.e. WAM, NAV, WAY, PY, average YTM, etc.) 13

Effective Investment Reporting‐Cont. •

•

•

Before distribution be sure to proof report for  possible typos or mistakes and be sure it reconciles  with the general ledger financials. PFIA does not require a report of performance, but  governing bodies typically focus on it so it is  important to have an indicator.  Whatever position you take in assessing  performance, investment officers should know the  performance of their portfolio, but they may choose  to report an average YTM since it will more closely  represent the return in the long run. 14

Benchmarking the Investment Portfolio.

• • •

The Portfolio Benchmark likely the most significant area of  focus How do you benchmark your investment portfolio? Stewards of the Public purse and fiduciary capacity points to ensuring investments are suitable and consistent with your investment policies.

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Benchmarking the Investment Portfolio. • Performance measure‐align both investment  policy and objectives (Preservation and safety  of principal, Liquidity, Diversification and  Yield) • A benchmark provides the governing body a  measure to relate to its investment return • It provides information of what a comparable  return is and would expect your portfolio to  be fairly close to that number.

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Benchmarking the Invest. Portfolio.‐Cont. • If portfolio far exceeds the benchmark, it  might indicate too much risk. • The governing body would need to  possibly re‐evaluate: • Authorized investments or strategies • Choose a different benchmark‐one  more  appropriate that most closely  resembles the portfolio in weighted  average maturity and asset type. 17

Benchmarking the Invest. Portfolio.‐Cont. • A benchmark should be familiar and verifiable‐ usually a comparable U.S. Treasury is used.

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Benchmarking the Invest. Portfolio‐Cont. •

• •

Benchmarking Performance‐should focus on Compliance  with Investment Policies and Objectives and factors such  as (Liquidity, Interest Rate Risk and Market Rate of  Return) Each government must determine a means of evaluating  portfolio performance criteria.  Suitability Standard-Questions you should ask yourself regarding your government’s investment portfolio: • Do we have sufficient liquidity to pay our obligations: (Liquidity Risk) • Do we have appropriate interest rate risk? (Low Yield, Moderate Yield or High Yield) 19

Benchmarking the Invest. Portfolio‐Cont. Self-Evaluating Suitability Cont. • Do we have a diversified portfolio?  • Do we have a portfolio of legal investments, and • Do we have an appropriate market rate of  return? • It is suggested to move from a total‐return market  benchmark to a market benchmark modified to  capture your unique investment objectives. • Fiduciary mandate‐Preserve principal and protect  taxpayer dollars while achieving a reasonable rate  of return for the government.

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Suggested Components of an Investment Report • • • • • •

Transmittal Letter (Report summary data) Investment Portfolio Chart of All Funds Investment Portfolio Chart‐Major Funds (General Fund,  Capital Projects, Etc.) Monthly Market Value of Total Investments by Fund  and Type Investment Portfolio by Investment Maturity Other Comparisons (as deemed appropriate): • Investment Yield Rates for Quarter Ended (Various  Pools) • Investment Yield Rates for Quarter Ended (10 Yr.  Treas Bnd vs Depository Now Acct) • 3 Month Treasury Benchmark vs Portfolio 21

Suggested Components of an Invest. Report‐Cont. • Monthly Cash Balances by Fund (Beg Bal, Receipts,  Disbursement, Ending Bal) • Quarterly Investment Additions and Deletions by  Fund (Prepared for each Investment Type, Fund,  Beg Bal, Deposits, Withdrawals, Interest, End Bal) • Monthly Investment Additions and Deletions by  Fund (Prepared for each Investment Type, Fund,  Beg Bal, Deposits, Withdrawals, Interest, End Bal) • Glossary of Terms 

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Suggested Components of an Invest. Report‐Cont. Transmittal Letter (Report summary data)

Suggested Components: • Affirm compliance with Investment Policy and PFIA • Total portfolio bal. including cash (Beg BV vs End BV) • Major fund investment focus as deemed appropriate • Summary investment portfolio, cash balance, book and fair values (monthly totals) • Total investment (+/-) during the period at market values • Interest earnings by invest. type (Qtr and YTD) • Monthly Data (WAM, NAV, WAY, PY) • Federal Funds rate and Discount rate Trends, LGIP, etc. • Summarize total interest earning (each Qtr) over period • Discuss benchmarks of portfolio performance, and • Signatures of all those involved in investment process 23

Suggested Components of an Invest. Report‐Cont.

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Suggested Components of an Invest. Report‐Cont.

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Suggested Components of an Invest. Report‐Cont. Monthly Market Value of Total Investments by Fund Group

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Suggested Components of an Invest. Report‐Cont. Investment Portfolio by Investment Maturity

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Suggested Components of an Invest. Report‐Cont.

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Suggested Components of an Invest. Report‐Cont. 3 Month Treasury Benchmark vs Portfolio

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Suggested Components of an Invest. Report‐Cont. Investment Yield Rates for Quarter Ended

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Suggested Components of an Invest. Report‐Cont. Cash Balances by Fund Grouping for each Fiscal Month thru the Qtr Ended

Invest. by Type and Fund Grouping for each Fiscal Quarter thru the Qtr Ended

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Suggested Components of an Invest. Report‐Cont. Monthly Investment Additions and Deletions by Fund Account (Each Month)

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PFIA Compliance Checklist • • •

Overall Investment Policy Checklist provided [Section 2256.023] ‐ Investment Reports Examples: • Is Investment Report prepared jointly and submitted to the governing body at least quarterly? • Do reports comply with the Act? Report describes in detail the investment position of the entity on the date of the report? • Report includes a summary statement of each pooled fund group that states the beginning market value, additions and changes, ending market value, and accrued interest? Etc.

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Resource Information • Government Code 2256 (PFIA) • GFOA, Government Finance Review, Oct 2005,  Beyond Total Return, By Benjamin Finkelstein,  Book “The Politics of Investing Public Funds • Investment Act Compliance Checklist  (Source:   Texas Association of College and University  Auditors,) revised for this presentation

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Questions

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Edward A. Dion, CPA El Paso County Auditor 800 E. Overland, Rm. 406 County Administration Building El Paso, Texas 79901 [email protected]

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Public Funds Investment Act Compliance Checklist (Texas Counties) The following questionnaire should be used as a limited guide to evaluating the requirements of the Public Funds Investment Act (Chapter 2256, Government Code). This checklist does not imply that an Investment Policy or Investment Program is in compliance with the PFIA. Each entity should review its own investment program with its attorneys and auditors to determine its compliance with the Act. [Section 2256.005(a)(b)] - Policy items Does entity have a written investment policy approved by your governing body? Do the policies specifically identify a list of public funds in its custody (See CAFR) which it has authority to invest individually or combined? Section 2256.002(3)(B) and 2256.002(9) Does the policy list the authorized investments for the investment of the entity’s funds? Does the policy state the maximum stated maturity of any individual investment and, for pooled fund groups, the maximum dollar-weighted average maturity? Does the policy include procedures to monitor the market price or rating changes of investments and the requirement that all transactions, excluding investment pools and mutual funds, be settled on a delivery versus payment basis? [Section 2256.005(c) and Section 2256.015(c)(2)] – Bidding

Present Present

Not Present Not Present

Present Present

Not Present Not Present

Present

Not Present

Has the entity adopted a requirement that bids for certificates of Deposit (statutory MAY) must be solicited? (bidding optional unless policy indicates SHALL) Does the entity prior to purchasing bonds receive bids from at least three separate providers (SHALL) with no material financial interest in the bonds from which proceeds were received [Section 2256.005(d)] - Strategy Items

Present

Not Present

Present

Not Present

Has the entity adopted a written investment strategy for each fund or group of funds under its control? Does the strategy describe the objectives for the fund using the priorities of suitability, preservation and safety of principal, liquidity, marketability, diversification, and yield in that order? [Section 2256.005(e)] - Policy & Strategy Review

Present

Not Present

Present

Not Present

Does the entity review the investment policy and investment strategy at least annually?

Present

Not Present

Does the entity adopt a written instrument stating that it has reviewed the policy and strategy? [Section 2256.005(f-i)] - Investment Officers

Present

Not Present

Has the entity designated one or more officers or employees as Investment Officers? Does the entity require its Investment Officer to disclose personal business relationships with a business organization offering to sell investments to the organization and have forms been completed? Does the entity require its Investment Officer to disclose whether he/she is related within the second degree by affinity or consanguinity to an individual seeking to sell an investment to the entity? [Section 2256.005(k-l)] - External Business Policy Certification

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Has a written copy of the investment policy been presented to every business organization offering to engage in an investment transaction with the entity, including investment pools, banks, and investment management firms? Has a written instrument from each business organization been received acknowledging that the investment policy has been received and reviewed and that procedures and controls have been implemented to preclude unauthorized transactions? Has a qualified representative as defined in Section 2256.002(10) of each business organization signed the written instrument? [Section 2256.005(m-n)] – Compliance Audit Is a compliance audit of management controls on investments and adherence to the entity’s established investment policies performed in conjunction with the annual financial audit?

Public Funds Investment Act Compliance Checklist (Texas Counties) [Section 2256.008] - Investment Officer Training Have the applicable training requirements been met by the Investment Officer and each Present employee involved in the investment process? Has each investment officer attended a training session at least once every two years and Present received training from an independent source approved by the governing body? Has the investment officer presented a report to the governing body on changes to the Public Funds Investment Act, if any, within six months after the end of each regular Present legislative session? Has the treasurer, the chief financial officer, and the investment officer attended at least one training session containing at least 10 hours of instruction within 12 months after Present taking office or assuming duties? Has each official attended a training session at least once every two years and received at least 10 hours of instruction from an independent source approved by the governing body Present or a designated investment committee? Has an independent source of investment training been approved by the governing body or a designated investment committee? Present Investment Type Restrictions/Qualifications

Not Present Not Present

Not Present

Not Present

Not Present

Not Present

Obligations Issued, Guaranteed, or Insured by the U.S. or its Agencies and Instrumentalities, including letters of credit [Section 2256.009(a)(1)(4)]

None

Obligations Issued, Guaranteed, or Insured by the State of Texas or its Agencies and Instrumentalities [Section 2256.009(a)(2)(4)]

None

Collateralized Mortgage Obligations [Section 2256.009(a)(3) and (b)(1-4)]*

10 yr. or less stated final maturity date Cannot be either an Interest-Only or Principal-Only CMO Cannot be an inverse floater

Obligations of States (other than Texas), Agencies, Counties, Cities and Other Political Rated not less than A or its equivalent by at least one Subdivisions [Section 2256.009(a)(5)] nationally recognized investment rating firm

State of Israel Bonds [Section 2256.009(a)(6)]

None

Certificates of Deposit (Section 2256.010)

Issued by a depository institution that has its main office or a branch office in Texas. Must be guaranteed or insured by FDIC or National Credit Union Share Insurance Fund and secured as described in the PFIA or other applicable law. Issued by one or more federally insured depository institutions, wherever located, provided that the funds are invested through a depository institution that has its main office or branch office in Texas and that the full amount of the principal and accrued interest of each certificate of deposit is insured by the U.S. or an instrumentality of the U.S. The depository institution through which the entity’s funds are invested shall receive an amount of deposits from customers of other federally insured depository institutions that is equal to or greater than the amount of funds invested. Must be fully collateralized as described in the PFIA Must have a defined termination date

Repurchase Agreements (Section 2256.011)

Public Funds Investment Act Compliance Checklist (Texas Counties) Repurchase Agreements (Section 2256.011)-Continued

Securities purchased must be pledged to the entity, held in the entity’s name, and deposited with the entity or with a third party selected and approved by the entity Placed through a primary dealer or a financial institution doing business in Texas Reverse agreements must not exceed 90 days; securities held as collateral must not mature later than the agreement’s expiration date

Securities Lending Program (Section 2256.0115)

Must be collateralized at not less than 100%, including accrued income Loans may be terminated at any time Loans must be secured as described in the PFIA Securities held as collateral must be pledged to the entity, held in the entity’s name and deposited with the entity or with a third party selected and approved by the entity Placed through a primary dealer or a financial institution doing business in Texas Securities lending agreement may not have a term greater than one year

Bankers’ Acceptances (Section 2256.012)

270 day or less stated maturity from date of issuance Accepted by a bank rated not less than A-1 or P-1 or an equivalent rating by at least one nationally recognized rating agency

Commercial Paper (Section 2256.013)

270 day or less stated maturity from date of issuance Rated not less than A-1 or P-1 or an equivalent by at least two nationally recognized rating agencies, or; Rated not less than A-1 or P-1 or an equivalent by one nationally recognized rating agency plus fully secured by an irrevocable letter of credit issued by a domestic bank

No-Load Money Market Mutual Fund [Section 2256.014 (a) and (c)]

Registered with and regulated by the Securities and Exchange Commission Provide a prospectus and other information required by the Securities Exchange Act of 1934 or the Investment Company Act of 1940 Must have a dollar-weighted average stated maturity of 90 days or less Must include in its objectives maintenance of a stable net asset value of $1 per share Investing entity may not own more than 10% of the fund’s total assets Registered with the Securities and Exchange Commission

Mutual Fund [Section2256.014 (b) and (c)]

Must have an average weighted maturity of less than two years Can only invest in obligations approved by the Act Rated not less than AAA or its equivalent by at least one nationally recognized investment rating firm

Public Funds Investment Act Compliance Checklist (Texas Counties) Mutual Fund [Section2256.014 (b) and (c)]-Continued

Comply with information and reporting requirements for investment pools as described in the Act Amount limited to 15% of investing entity’s monthly average fund balance, excluding bond proceeds, reserves, and debt service funds. Ineligible for investment of bond proceeds, reserves, and debt service funds Investing entity may not own more than 10% of the fund’s total assets

Guaranteed Investment Contracts (Section 2256.015)

Authorized for bond proceeds investment only Must have a defined termination date Must be secured by U.S. Government direct or agency obligations approved by the Act in an amount equal to the bond proceeds Security must be pledged to the entity and deposited with the entity or a third party Term must be limited to five years from the date of bond issuance, excluding reserves and debt service funds Must comply with terms and conditions concerning eligibility as an authorized investment as specified in Section 2256.015(c) of the Act Must receive bids from at least three separate providers with no material financial interest in the bonds from which proceeds were received as specified in Section 2256.015(c)(2) of the Act

Investment Pools [Section 2256.016]

Governing body must authorize investment in pool Can only invest in obligations approved by the Act Provide an offering circular containing information required by the Act Provide investment transaction confirmations Provide a monthly report containing information required by the Act Pool created to function as a money market mutual fund must mark its portfolio to market daily and stabilize at a $1 net asset value. Must have an advisory board as specified by the Act Rated not less than AAA or an equivalent rating by at least one nationally recognized rating service.

[Section 2256.023] - Investment Reports Is the investment report prepared jointly by all investment officer(s), investment employees and submitted to the governing body at least quarterly? Do the reports contain the information required by the Act? Does the report describe in detail the investment position of the entity on the date of the report? Does the report include a summary statement of each pooled fund group that states the beginning market value, additions and changes, ending market value, and accrued interest? Does the report include book and market value of each separately invested asset at the beginning and end of the reporting period by the type of asset and fund type invested? Does the report include the maturity date of each invested asset? Does the report reflect the account or fund in the local government for which each investment was acquired?

Present

Not Present

Present Present

Not Present Not Present

Present

Not Present

Present

Not Present

Present Present

Not Present Not Present

Public Funds Investment Act Compliance Checklist (Texas Counties) [Section 2256.023] - Investment Reports-Continued Does the report include a statement on the compliance of the investment portfolio of the local government as it relates to the investment policy strategy and PFIA? Do all investment officers and all employee(s) involved in the investment process sign the reports? It the report presented to the governing body within a reasonable time after the end of the period? Do the reports include a statement of compliance of the investment portfolio with the Act and the investment strategy? Does an independent auditor review the reports at least annually if your investments include obligations other than money market mutual funds, investment pools, or depository bank investment accounts and is it reported to the governing body by the auditor? [Section 2256.003(b)] - Investment Management Firm If the entity has contracted with an investment management firm to provide for the investment and management of its public funds or other funds under its control, is the investment management firm registered either under the Investment Advisers Act of 1940 or with the State Securities Board? Is the contract with the investment management firm limited to a maximum term of two years with renewal or extension subject to approval of the governing body by order, ordinance, or resolution? [Section 2256.025] - Qualified Brokers List Has the governing body or designated investment committee adopted a list of qualified brokers? Does the governing body or designated investment committee review, revise, and approve the list at least annually?

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Present

Not Present

Texas Association of Counties Sample Quarterly Report Texas Government Code 2256 requires counties to report investments quarterly. The attached is an example developed by a committee of county investment officers and is based on the requirements of the statute. The Texas Association of Counties does not warrant that all law is covered by this document, rather this is a general document that may be helpful when developing your own report. The reporting requirements of the PFIA assume that the county is using an accrual method of accounting. This sample report should reconcile to the general ledger if the county uses an accrual method of accounting. If your county uses cash accounting, the investment report will state a current book value that doesn’t match the general ledger. Remember that the PFIA defines book value to include amortization/accretion. Your county should have written guidelines for investment accounting, which should consider the requirements of the quarterly investment reports. You are encouraged to use this document as a model, but each county must alter the report to meet its specific needs. Make sure you include all information required by the PFIA.

Investment Reporting

Sample County Quarterly Investment Report April 1, XXX2 - June 30, XXX2 Portfolio Summary for Operating Fund This report is made in accordance with provisions of Government Code 2256 (Section 2256.023), The Public Funds Investment Act. The investments held in the Sample County portfolio comply with the Public Funds Investment Act and with the County's investment policy and strategies.

Beginning

Ending

Book Value

$

4,021,478

$ 4,516,570

Market Value

$

4,020,530

$

Unrealized Gain/(Loss) at 6/30/X2

4,514,595

$

(1,975)

Change in Market Value

$

(891)

Additions to Market Value

$

494,956

Accrued Interest Receivable

$

63,190

Market Value minus Book Value

Weighted Average Maturity

176 Days

189 Days

Average Yield to Maturity at 6/30/X2

6.07%

Average Yield 6-month U. S. Treasury Bill for period

4.62%

Market Review [If you wish to talk about the market, include a statement about the current economic conditions and summarize what has happened over the quarter; you may want to avoid predicting what the market expects in terms of interest rates, since counties invest according to cash needs and don’t speculate on what rates will do. You might include a current yield curve for reference. Performance measurement combines market gain/loss with interest earned, but proper calculation involves timing of cash flows. It can be difficult without computer software. Since most counties hold to maturity, some I.O. report average YTM and report unrealized gain/loss separately. This focuses on a long-term return more than a spot in time. The law doesn't require you to report yield at all, but some policies call for it.] Collateral Adequacy [State whether collateral on cash balances and bank CDs was adequate for the period. If there was a lapse, explain why (i.e. an unexpected property tax deposit made late in the day, etc.).]

Submitted to Commissioners Court of Sample County:

July 8, XXX2

Prepared and Submitted by: Joan O. Ark, Investment Officer

Investment Reporting

Sample County Quarterly Investment Report April 1, XXX2 - June 30, XXX2 Investment Inventory as of June 30, XXX2 for Operating Fund Settle Date 6/02/X2

3/31/X2 3/31/X1

Description T-Bill T-Bill Total

T-Note T-Note

Coupon N/A

Par Value 1,000,000 1,000,000

Maturity 08/31/X2

7.50% 7.75%

1,000,000 1,000,000

1/31/X4 1/31/X3

T-Note Total 6/29/X2

Pool

99.375 99.500

Purchase Principal 988,750 988,750

Book Value 992,375 992,375

993,750 995,000

994,596 998,393

1,988,750

1,992,989

1,531,206.00

1,531,206.00

7.86% 8.04%

2,000,000 4.50%

1,531,206

6/30/X2

100

4.50%

Market Price 99.375

Unrealized Accrued Gain/(Loss) Interest 1,375 1,375

99.3125 99.651421

100

(1,471) (1,879)

31,077 32,113

(3,350)

63,190

-

Pool Total

1,531,206

1,531,206

1,531,206

-

Grand Total

4,531,206

4,508,706

4,516,570

(1,975)

Allocation Limits per Policy

Asset Distribution

34%

T-Bill T-Note Pool

Purchase Purchase Price Yield 98.875 4.614%

22%

T-Bill

44%

T-Note

992,375 1,992,989 1,531,206

Pool

Commercial Paper Repurchase Agmts CDs U. S. Agencies U. S. Treasuries

< 5% < 15% < 25% < 70% 0-100%

(example of policy limits)

63,190

Maturity Schedule by Par Value 1,800,000 1,600,000 1,400,000 1,200,000 1 year

Investment Reporting

Sample County Quarterly Investment Report April 1, XXX2 - June 30, XXX2 Position Change Report for Operating Fund

Settle Date

Description

Coupon

Par Value

Cash or Cash Equivalents 6/29/X2 Pool 4.50% 1,531,206 Marketable Securities 6/02/X2 T-Bill 3/31/X2 T-Note 3/31/X1 T-Note

Total

Maturity

daily

Beginning Values Book Market 3/31/X2 3/31/X2

2,030,000

Ending Values Book Market 6/30/X2 6/30/X2

Change in Additions Market to MV Value

2,030,000

1,531,206

1,531,206

N/A 1,000,000 08/31/X2 Did not own Did not own 7.50% 1,000,000 1/31/X4 993,759 993,750 7.75% 1,000,000 1/31/X3 997,719 996,780

992,375 994,596 998,393

993,750 993,125 996,514

(625) (266)

4,516,570

4,514,595

(891)

4,021,478

4,020,530

(498,794)

993,750

494,956

Investment Reporting

Sample County Quarterly Investment Report April 1, XXX2 - June 30, XXX2 Transactions for Operating Fund Settle Date Description Coupon Purchased 6/02/X2 T-Bill 6/01/X2 Pool Total Purchases

N/A 4.6%

Par Value

Maturity

1,000,000 08/31/X2 1,000,000 6/02/X2 2,000,000

Price

Principal Cost

98.875 100

988,750 1,000,000 1,988,750

100 100

1,000,000 498,794 1,498,794

Gain (Loss)

Matured none

Sold 5/15/X2 Pool 6/02/X2 Pool Total Sales

4.65% 4.60%

1,000,000 498,794 1,498,794

5/15/X2 6/02/X2

0 0