Laserfiche WebLink
City of San Leandro <br />Notes to Basic Financial Statements <br />For the year ended June 30, 2012 <br /> <br /> <br />54 <br /> <br />NOTE 2 - CASH AND INVESTMENTS, continued <br /> <br />The City follows the practice of pooling cash and investments of all funds, except for funds required to be held by fiscal <br />agents under the provisions of bond indentures. Interest income earned on pooled cash and investments is allocated on an <br />accounting period basis to the various funds based on the period-end cash and investment balances. Interest income from <br />cash and investments with fiscal agents is credited directly to the related fund. <br /> <br /> <br />B. Investments <br />Under the provisions of the City’s investment policy, and in accordance with California Government Code, the City’s <br />Cash and investments as of June 30, 2012, are classified as follows: <br /> <br />Statement of net assets: <br />Cash and Investments 70,302,928$ <br />Cash and Investments held by trustee 4,159,826 <br />Fiduciary Funds: <br />Cash and Investments 10,468,899 <br />Cash with fiscal agents 11,683,269 <br />Total cash and investments 96,614,922$ <br />Cash and investments as of June 30, 2012, are classified as follows: <br />Deposits with financial institutions 9,347,524$ <br />Investments 87,267,398 <br />Total cash and investments 96,614,922$ <br /> <br /> <br />Interest Rate Risk <br /> <br />Interest rate risk is the risk that changes in market interest rates will adversely affect the fair value of an investment. <br />Generally, the longer the maturity of an investment, there is a greater sensitivity of its fair value to changes in market <br />interest rates. One of the ways that the City manages its exposure to interest rate risk is by purchasing a combination of <br />shorter term and longer term investments and by timing cash flow from maturi ties so that a portion of the portfolio is <br />maturing or coming close to maturity evenly over time as necessary to provide cash flow and liquidity needed for <br />operations. <br /> <br />In accordance with the Policy, the City manages its exposure to declines in fair value s by limiting the weighted <br />average maturity of its investment portfolio to 5 years or less. The City is in compliance with this provision of the <br />Policy.