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HomeMy WebLinkAbout2021-PAD-032 Investment COUNTY OF NEWELL - POLICY HANDBOOK POLICY NO: 2021-PAD-032 TITLE: INVESTMENT ADOPTED: May 6, 2021 (C-163/21) SUPERCEDES NO: 2019-PAD-032 TO BE REVIEWED: PAGE NO: 1 of 4 POLICY STATEMENT: The County of Newell will invest public funds in a prudent manner that provides the highest return with the maximum security while meeting daily cash flow needs and conforming to all provincial statutes and regulations governing the investment of municipal funds. PURPOSE AND SCOPE: The purpose of this policy is to establish and maintain practices and procedures for investment of funds held by the County. This investment policy applies to all investment transactions involving the financial assets of the County and must be applied by any party managing County investments. OBJECTIVES: The primary objectives of the County’s investment activities are preservation of capital, liquidity, risk mitigation and investment returns. Preservation of Capital The County recognizes its fiduciary responsibility for the stewardship of public funds with which it has been entrusted. Therefore, its foremost investment objective is to ensure the preservation of capital. Liquidity The investment portfolio will remain sufficiently liquid to enable the County to meet operating requirements which might be reasonably anticipated. The portfolio should consist largely of securities with active secondary or resale markets. Risk Mitigation The County will manage risk by ensuring there is sufficient diversification among the assets in its investment portfolios. Additional risk control is provided by the constraints on the permitted investments. Investment Returns The County will seek to maximize the rate of return earned on its investments while following prudent investment principles. COUNTY OF NEWELL - POLICY HANDBOOK POLICY NO: 2021-PAD-032 TITLE: INVESTMENT ADOPTED: May 6, 2021 (C-163/21) SUPERCEDES NO: 2019-PAD-032 TO BE REVIEWED: PAGE NO: 2 of 4 STANDARDS OF CARE: Prudence Investments shall be made with judgment and care under circumstances then prevailing. Investment officials exercising due diligence and acting in accordance with procedures consistent with this investment policy shall be relieved of personal responsibility for market price changes or the credit risk of a certain investment provided that appropriate action is taken to control adverse developments and that such developments are reported on a timely basis. Conflict of Interest Investment officials shall refrain from personal business transactions that could conflict with the proper execution of their responsibilities, or which may impair their ability to make impartial investment decisions. Investment officials shall disclose to the Chief Administrative Officer any material interests in financial institutions that conduct business with the County, and they shall separate their personal investment transactions from those of the County. Authority and Internal Control The Chief Administrative Officer is ultimately responsible and accountable for the control, management, and administration of the County’s investments in accordance with the investment policy approved by Council. The Chief Administrative Officer may delegate this responsibility. The Chief Administrative Officer or Appointed Delegate shall establish appropriate guidelines, procedures, and internal controls; a) To ensure the achievement of the objectives identified within this policy. b) For authorizing officers and employees to engage in investment activities. c) For purchasing and selling investments. d) For custody and safekeeping of investments. e) For the accounting and reporting of investment activities. Where external resources have been engaged to provide investment services, they are required to follow the CFA Institute Code of Ethics and Standards of Professional Conduct and provide certification to the Manager of Finance that the investments meet the terms of this investment policy before investments are made. COUNTY OF NEWELL - POLICY HANDBOOK POLICY NO: 2021-PAD-032 TITLE: INVESTMENT ADOPTED: May 6, 2021 (C-163/21) SUPERCEDES NO: 2019-PAD-032 TO BE REVIEWED: PAGE NO: 3 of 4 PERMITTED INVESTMENTS: The County only invests in the securities which are Authorized Investments as defined and described by sections 250(1) and (2) of the Municipal Government Act (MGA) RSA 2000 Chapter M-26 (as amended). Schedule I and Schedule II below identify the securities that the Chief Administrative Officer or Appointed Delegate can purchase on behalf of and in the name of the County: COUNTY OF NEWELL - POLICY HANDBOOK POLICY NO: 2021-PAD-032 TITLE: INVESTMENT ADOPTED: May 6, 2021 (C-163/21) SUPERCEDES NO: 2019-PAD-032 TO BE REVIEWED: PAGE NO: 4 of 4 Institutions not meeting the minimum required rating, or its equivalent, can be invested in to the extent that principal and interest are covered by the Canadian Deposit Insurance Corporation. The maturity dates of investments in the long-term portfolio will be diversified to minimize effects of fluctuations in any given part of the yield curve and to maintain liquidity for projects anticipated in the County’s long-term financial plans. The average duration for the long-term portfolio will not exceed 6 years. PROCUREMENT AND CUSTODY: The Chief Administrative Officer or Appointed Delegate shall ensure that: 1. The method of procurement achieves and maximizes the objectives of this policy. Investment activities may be undertaken utilizing internal resources or external (contract) resources or a combination of internal and external resources. The utilization of external resources must be approved by Council. 2. All investment certificates issued to the County of Newell are in the name of or held in the name of the County of Newell. 3. Negotiable securities are held in one of two ways: a. In a safekeeping compartment with the County’s banker. b. Held by a third party custodian in the name of the County and evidenced by safekeeping receipts and monthly statements. 4. Non-negotiable investment certificates are maintained in an appropriate investment file at the County Office. 5. All security transactions are conducted on a delivery-versus-payment basis. DEFINITIONS Appointed Delegate: For the purpose of this policy, designates of the Chief Administrative Officer include the Director of Corporate Services, the Controller, or any other employee or contracted resource specifically assigned by the Chief Administrative Officer.