06-24-2024 CC Agenda Packet - Laserfiche WebLink

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City of Orono, Minnesota Notes to the Financial Statements December 31, 2023 Note 3: Detailed Notes on All Funds (Continued) Concentration of Credit Risk - Concentration of credit risk is defined as positions of five percent (5 percent) or more in the securities of a single issuer. to 35% of a specific type. As of December 31, 2023, the following issuer exceeded 5 percent of the Ci investments: MN Municipal Money Markets (4M) (40 percent). Custodial Credit Risk - Deposits. In the case of deposits, this is the risk that in the event of a bank failure, the City's deposits may not be returned to it. Minnesota statutes and the City's investment policy states that in order to provide a level of security for all funds, the collateralization level will be 110 percent of market value not covered by insurance. and must have a minimum capital and surplus of $10,000,000 and a net worth to asset ratio minimum of 5 percent As of December 31, 2023, all of the City's bank balance was covered by federal depository insurance or by perfected collateral held by the City's agent in the City's name. Custodial Credit Risk - Investments. For an investment, this is the risk that, in the event of the failure of the counterparty, the City will not be able to recover the value of its investments or collateral securities that are in possession of an outside party. As of December 31, 2023, all securities were held by the City or its agent in the City's name. The City typically limits its exposure by purchasing insured or registered investments, or by the control of who holds the securities. City investment policies require that security/broker/dealers be restricted to those regulated by the Securities and Exchange Commission, have a minimum capital of $40,000,000 and may investments with a specific dealer to 30 percent of the investment portfolio. A reconciliation of cash and temporary investments as shown on the statement of net position for the City follows: 63 control of who holds the securities. City investment policies require that security/broker/dealers be restricted to control of who holds the securities. City investment policies require that security/broker/dealers be restricted to those regulated by the Securities and Exchthose regulated by the Securities and Exchange Commission, have a minimum capital of $40,000,000 and may ange Commission, have a minimum capital of $40,000,000 and may investments wiinvestments with a specific dealer to 30th a specific dealer to 30 percentpercent of the investment portfolioof the investment portfolio. A reconciliation of cash and temporary investments as shown on the statement of net position for the City A reconciliation of cash and temporary investments as shown on the statement of net position for the City follows: 98