2019-06-28 Special Meeting Agenda

SPECIAL MEETING AGENDA   28 JUNE 2019




                         Page 18 of 61

SPECIAL MEETING AGENDA                                                                      28 JUNE 2019

 INVESTMENT OF SURPLUS FUNDS POLICY

 REPORTING
 The Manager Financial Services will prepare a monthly report and evaluation of the transactions,
 concentrations, performance and compliance of the investment portfolio. The report will include:
 e   summary of securities held at the end of the reporting period by counterparty;
 e   liquidity of the portfolio as at reporting date;
 e   percentage of the portfolio considered ethical investment;
 e   percentage of the portfolio held by investment risk category; and
 e   performance of the portfolio [relative to Bloomberg AusBond Bank Bill Index benchmark and/or
     BBSW).
 On an annual basis, the policy will be reviewed and amended where required, with any amendments
 to be approved by Council prior to implementation as part of annual budget adoption.

 PERFORMANCE MEASUREMENT
 The investment return for the portfolio shall be measured using the market value of the portfolio,
 including withdrawals and deposits, and total performance of the portfolio compared to the
 Bloomberg AusBond Bank Bill Index. This is to include changes in the capital value of assets held
 (where applicable), income from managed investment portfolio assets, proceeds of sales of assets
 sold and cost of assets acquired. The market value of the portfolio is to be calculated at least monthly
 to coincide with monthly reporting. In defining market value, at least two pricing sources should be
 included in the valuation of the securities.

 DEFINITIONS
 BBSW - Bank Bill Swap Rate — This is the daily calculation of the yields on bank bills of 1, 2, 3, 4,
 5, and 6 month maturities used for the setting of financial arrangements.
 Bloomberg AusBond Bank Bill Index — widely considered to be the industry benchmark for short
 term cash fund performance and is used by market participants as a means of comparing the returns
 generated by the various cash funds available in the market.
 Credit Risk — is the risk of loss due to the failure of an investment issuer or guarantor
 Ethical Investment Principles — |nvestment in companies or industries that promote positive
 approaches to environmental, social and corporate governance issues; or the avoidance of
 investment in industries deemed harmful to health or the environment. These principles have been
 recognised by the United Nations Principles for Responsible Investment. '
 Financial Institution is defined as an authorised deposit-taking institution within the meaning of the
 Banking Act 1959 (Cwith), Section 5.?
 Investments are defined as arrangements that are undertaken or acquired for producing income
 and apply only to the cash investments of Noosa Shire Council.
 Market Value of the portfolio is the book value of fixed term fixed interest deposits plus a market
 value assessment of commercial paper, bank bills, and bonds or floating rate notes.
 QIC — Queensland Investment Corporation.
 QTC — Queensland Treasury Corporation.

 1 Further information on the United Nations Principles for Responsible Investment, including a schedule of Australian signatories, can be
 obtained from the following website http://www.unpri.org/principles/
 2 For a list of authorised deposit taking institutions, refer to the website of the Australian Prudential Regulation Authority:
 http://www.apra.gov.au/adi/.

                                                                                            Page 18 of 61