Notes to Financial Statements

3) Detailed notes on All Funds

Cash, Cash Equivalents, and Investments

At September 30, 2022, the City had the following cash, cash equivalents, investments, and maturities including restricted investments:

FY2022 cash of $118,651 is restricted cash held in trust and not included in cash and cash equivalents or investments.

Deposit and Investment Policies

Idaho Code 50-1013 limits the City’s legal investments to savings accounts, prime commercial paper, general obligations of the State of Idaho and United States Treasury, notes, bonds, and obligations of Government Sponsored Enterprises (FNMA, FHLMC, FFCB, FHLB), A-rated corporate bonds, and money market and mutual funds whose portfolios consist of the aforementioned underlying instruments. Any funds not matched to a specific cash flow or other specific purpose allowed by law or City Council resolution shall not be invested in securities longer than 10 years from the date of purchase. The City, except as indicated below, is limited to the following general types of investments:

• Certain revenue bonds, general obligation bonds, local improvement district bonds, tax and revenue anticipation notes, and registered warrants of state and local government entities.

• Time deposit accounts.

• Bonds, treasury bills, interest-bearing notes, debentures or other similar obligations of the United States Government and the Farm Credit System and its agencies and instrumentalities. U.S. Government Securities include U.S. Treasury receipts and U.S. Treasury Stripped Interest Payment series (STRIPS).

• Repurchase agreements.

• Banker’s acceptance and prime commercial paper.

• Mutual or Money Market Funds.

• Corporate bonds rated A or better at the time of purchase. Investments associated with the Health Insurance Trust Fund must be allowable under both Idaho Code 501013 and 41-4109 et. Seq.

The City’s investment policy requires that investments within the portfolio be diversified as to security type, duration, and issuer in order to maintain a balanced portfolio. The City only conducts investment purchases on a delivery-vs-payment basis with all securities maintained through a third-party custodial safekeeping agreement which requires that they be held in the City’s name.

Interest Rate Risk, Credit Risk, Custodial Credit Risk

In accordance with the City’s investment policy of diversifying its investments as to type, issuer, and maturity, the City chooses to monitor its interest rate risk exposure utilizing effective duration. Effective is the preferred