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12. 0 Maximum Maturities. To the extent possible, the City <br /> will attempt to match its investments with anticipated cash <br /> flow requirements, holding investments to maturity whenever <br /> possible. The City will not directly invest in securities <br /> maturing more than 3 years from the date of purchase. <br /> However, the City may collateralize its repurchase <br /> agreements using longer-dated investments not to exceed 10 <br /> years to maturity. <br /> 13 . 0 Internal Control. The Treasurer shall establish a <br /> system of internal controls, which shall be reviewed <br /> annually by an external auditor. This review will provide <br /> internal control by assuring compliance with policies and <br /> procedures. <br /> 14.0 Performance Standards. The investment portfolio will <br /> be designed to obtain a market average rate of return during <br /> budgetary and economic cycles, taking into account the <br /> City's investment risk constraints and cash flow needs. <br /> 14. 1 Market Yield (Benchmark) . The City's investment <br /> strategy is passive. Basically, the passive approach <br /> to investing involves buying-and-holding purchases <br /> until maturity. Given this strategy, the basis used by <br /> the Treasurer to determine how the portfolio's market <br /> average rate of return compares to the market yields <br /> shall be the three-month U.S. Treasury Bill and the <br /> average Fed Funds Rate. <br /> 15. 0 Reporting. The Treasurer is charged with the <br /> responsibility of including a market report on investment <br /> activity and returns in the City's Comprehensive Annual <br /> Financial Report. This report shall contain such <br /> information as the Treasurer deems appropriate, provided <br /> that the Finance Director and the Finance Committee shall <br /> have the right to request that specific information be <br /> provided in the report. A quarterly report of like content <br /> shall be provided to the Finance Director. <br /> 16.0 Investment Policy Adoption. The City's investment <br /> policy shall be adopted by Ordinance by the Everett City <br /> Council. The policy shall be reviewed on an annual basis by <br /> the Treasurer and any modifications made thereto must be <br /> approved by the Everett City Council. <br /> InvPoli3 <br /> 10/13/92 <br />