2014-06-26 Budget Meeting Attachment H

STRATEGIC POLICY – 2014/15 INVESTMENT POLICY


Investable funds
For the purposes of this policy, investable funds are the moneys available for investment at any
one time and include the Council’s bank account balance. Included in this balance is any moneys
held by Council on behalf of external parties (for example developer contributions).

The investable funds should be matched against the cash flow needs of Council deemed by the
Manager Financial Services after preparing Council’s budget. Once the Manager Financial
Services has determined that the cash flow forecast can be met, if required, funds may be invested
for the required term. In this regard, it is appropriate for the Manager Financial Services to be
conservative (i.e., it is unlikely that investments are be broken to meet cash flow obligations).

It is the responsibility of the Manager Financial Services to assess the cost of direct investment
management by Council relative to the return generated. This should be compared with the cost of
investing funds with a capital guaranteed cash fund, for example QTC Capital Guaranteed Cash
Fund.

The maturity structure of the investment portfolio will reflect a maximum term to maturity of no
longer than twelve (12) months.

Authorised investments
Without specific approval from Council or the Treasurer, investments are limited to those
prescribed by Section 6 of the Statutory Bodies Financial Arrangements Act 1982 for local
governments with Category 1 investment power, which include:
   deposits with a financial institution;
   interest bearing deposits;
   commercial paper;
   bank accepted/endorsed bank bills;
   bank negotiable certificates of deposit;
   short term bonds;
   floating rate notes;
   QIC Cash Fund; and
   QTC Capital Guaranteed Cash Fund, Debt Offset Facility, Fixed Rate Deposit (up to 12
    months) and QTC Working Capital Facility.


Prohibited investments
This Investment Policy prohibits any investment carried out for speculative purposes. The Manager
Financial Services may include a prohibited investments list within the Investment Guidelines and
Approved Lists.

The following investments are prohibited by this investment policy:
 derivative based instruments (excluding floating rate notes);
   principal only investments or securities that provide potentially nil or negative cash flow;
   stand-alone securities issued that have underlying futures, options, forward contracts and
    swaps of any kind; and
   securities issued in non-Australian dollars.




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