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Legislative Audit Committee Representatives Bill Beck _part2

Tham khảo tài liệu 'legislative audit committee representatives bill beck _part2', tài chính - ngân hàng, kế toán - kiểm toán phục vụ nhu cầu học tập, nghiên cứu và làm việc hiệu quả | A-7 3. Cash Cash Equivalents Cash and cash equivalents consist of funds deposited with the US Bank N.A. as trustee and include investments categorized as cash equivalents. Cash equivalents are defined as short-term highly liquid investments with original maturities of three months or less. Disclosures Relating to Credit Risk Generally credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating organization. In accordance with the investment policy defined in the bonds trust indenture the cash equivalent funds invested by US Bank N.A. as trustee are held in a Treasury Obligations Money Market Fund that invests exclusively in short-term U.S. Treasury obligations and repurchase agreements secured by U.S. Treasury obligations. The U.S. Treasury obligations in which the fund invests include U.S. Treasury bonds notes and bills and are backed by the full faith and credit of the United States government. Disclosures Relating to Custodial Credit Risk Custodial credit risk for investments is the risk that in the event of the failure of a depository financial institution a government will not be able to recover deposits or will not be able to recover collateral securities that are in the possession of an outside party. The investment policy as defined in the Indenture of Trust and contract with the trustee does not require collateralization for cash and securities held by the trustee. Securities are registered with the Federal Reserve Bank under U.S. Bank as trustee for the State of Montana Department of Natural Resources and Conservation. However U.S. Bank policy is to collateralize money market funds at 101 of cost. Disclosures Relating to Interest Rate Risk Interest rate risk is the risk that changes in interest rates will adversely affect the fair value of an investment. The investment policy for the programs as .