2014-01-02 Budget Attachments

2013/14 INVESTMENT POLICY


Safekeeping and custody
Each transaction will require written confirmation by the broker / dealer / bank. Council will hold
security documents, or alternatively a third party custodian authorised by the Financial Services
Co-ordinator and evidenced by safekeeping receipts may hold security documents.
Criteria of authorised dealers and broker
Council will maintain a list of authorised financial institutions and securities brokers that the
investment officers may deal with. These financial intermediaries must have a minimum long term
rating of at least either A+/A1/A+ from Standard and Poor’s, Moody’s or Fitch IBCA.

All transactions undertaken on behalf of the investment portfolio of Council will be executed either
by Council directly, or through securities brokers registered as Australian Financial Service
Licensees (ASIC) with an established sales presence in Australia, or direct issuers that directly
issue their own securities which are registered on Council’s approved list of brokers/dealers and
direct issuers.

INVESTMENT GUIDELINES
The Financial Services Co-ordinator may reduce these maturity limits to a shorter period, or higher
ratings through internal Investment Guidelines and Approved Lists. The Financial Services Co-
ordinator may approve limits for unrated securities after being satisfied that adequate analysis has
been performed to demonstrate above average credit quality (i.e. better than BBB+).

Treasurer approval is required for investments with a period of greater than 12 months.
Functionally this means approval is required from Council prior to submission to the Treasurer for
approval.


REPORTING
The Financial Services Co-ordinator will prepare a monthly report and evaluation of the
transactions, concentrations, performance and compliance of the investment portfolio. The report
will include:

      summary of securities held at the end of the reporting period by counterparty;
      liquidity of the portfolio as at reporting date;
      percentage of the portfolio held by investment risk category; and
      performance of the portfolio [relative to UBS Australia Bank Bill benchmark and/or BBSW].

On an annual basis, the Investment Policy will be reviewed and amended where required; any
amendments are to be approved by Council prior to the implementation of the revised investment
policy.

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 UBS
Australia 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.




Noosa Shire Council                                                                        Page 6 of 7