R-2000-16 - Laserfiche WebLink

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Finance or a third party financial institution. Repurchase agreements shall be documented by specific agreement noting the collateral pledged in each agreement. Collateral shall be reviewed monthly to assure the market value of the securities pledged equals or exceeds the related bank balances. SAFEKEEPING AGREEMENT All safekeeping arrangements shall be in accordance with a Safekeeping Agreement approved by the Audit Committee which clearly defines the procedural steps for gaining access to the collateral should the City of La Porte determine that the City's funds are in jeopardy. The safekeeping institution, or Trustee, shall be the Federal Reserve Bank or an institution not affiliated with the firm pledging the collateral. The safekeeping agreement shall include the signatures of the City of La Porte, the firm pledging the collateral, and the Trustee. COLLATERAL DEFINED The City of La Porte shall accept only the following securities as collateral: A. FDIC and FSLIC insurance coverage; B. United States Treasuries and Agencies; C. Texas State, City, County, School or Road District bonds with a remaining maturity often (10) years or less with rating from a nationally recognized investment rating firm and having received a rating of not less than A or its equivalent; D. Other securities as approved by the Audit Committee. SUBJECT TO AUDIT All collateral shall be subject to inspection and audit by the Director of Finance or the City's independent auditors. DELIVERY VERSUS PAYMENT Treasury Bills, Notes & Bonds and Government Agencies' securities shall be purchased using the delivery versus payment method. That is, funds shall not be wired or paid until verification has been made that the collateral was received by the Trustee. The collateral shall be held in the name of the City or held on behalf of the City. The Trustee's records shall assure the notation of the City's ownership of or explicit claim on the securities. The original copy of all safekeeping receipts shall be delivered to the City. IX. MANAGEMENT AND INTERNAL CONTROLS The Director of Finance shall establish a system of internal controls, which shall be reviewed by an independent auditor. The controls shall be designed to prevent losses of public funds arising from fraud, employee error, misrepresentation by third parties, unanticipated changes in financial markets, or imprudent actions by employees or Investment Officials of the City. Controls and managerial emphasis deemed most important that shall be employed where practical are: A. Control of collusion. B. Separation of duties. C. Separation of transaction authority from accounting and record keeping.