AG 2009 11 16 - Laserfiche WebLink

Home Browse Search

Cabarrus County, North Carolina Notes to the Financial Statements For the Year Ended June 30, 2009 deposits are properly secured. The Cabarrus Health Alliance has no formal policy regarding custodial credit risk for deposits. At June 30, 2009, the carrying amount of the County's bank deposits (including fiduciary funds) was $1,795,540 and the bank balance was $2,315,179. There was $46,970,905 in an escrow account with a financial institution. Sufficient collateral was maintained at June 30, 2009 to secure the County's deposits. Of the bank balance, $751,958 was covered by federal depository insurance, the balance was covered by collateral held by authorized escrow agents in the name of the County. At June 30, 2009, the County had $6,940 of cash on hand. At June 30, 2009, the carrying amount of the Alliance's bank deposits was $699,263 and the bank balance was $699,481. Of the bank balance, $100,000 was covered by federal depository insurance or by collateral held by the Alliance's agent in the Alliance's name. At June 30, 2009, the Alliance had $2,100 of cash on hand. B. Investments As of June 30, 2009 the County had the following investments and maturities Investment Type Fair Value Less Than 6 Months 6-12 Months 1-3 Years NC Capital Management Trust - Cash Portfolio $ 92,217,003 $ - $ - $ Interest Rate Risk. As a means of limiting its exposure to fair value losses arising from rising interest rates, the County's investment policy limits at least half of the County's investment portfolio to maturities of less than 12 months. Also, the County's investment policy requires purchases of securities to be laddered with staggered maturity dates and limits all securities to a final maturity of no more than three years. Credit Risk. The County limits investments to the provisions of G.S. 159-30 and restricts the purchase of securities to the highest possible ratings whenever particular types of securities are rated. The County's investments in the NC Capital Management Trust Cash Portfolio carried a credit rating of AAAm by Standard & Poor's as of June 30, 2009. Custodial Credit Risk. For an investment, custodial credit risk is the risk that in the event of the failure of the counterparty, the County will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The County's formal policy indicates that the County shall utilize a third party custodial agent for book entry transactions, all of which shall be a trust department authorized to do trust work in North Carolina who has an account with the Federal Reserve. Certificated securities shall be in the custody of the designated investment officer. Concentration of Credit Risk. With the exception of U.S. Treasury securities and agencies and authorized pools, Cabarrus County's investment policy does not allow for an investment in any one issuer in excess of 35% of the County's total investments. At June 30, 2009, the Cabarrus Health Alliance investments consisted of $2,548,366 in the North Carolina Capital Management Trust's Cash Portfolio, which carried a credit rating of AAAm by Standard and Poor's. The Alliance has no policy on credit risk or custodial credit risk. 47 Attachment number 3 G-8 Page 321