06-28-1995 Council Agenda - Laserfiche WebLink

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LITTLE CANADA FIREMEN'S RELIEF ASSOCIATION NOTES TO FINANCIAL STATEMENTS December 31, 1994 Page 2 of 8 F. PENSION BENEFIT OBLIGATION The accrued pension liability at December 31,1994 has been determined in accordance with Minnesota State Statutes 69.772 for lump sum pension benefits. The benefits are payable after age 50; 20 years of service; and at least 10 years of Association membership. The amount payable is based on $2,050 for each year of service but not exceeding the maximum amount per year of service allowable by law for the minimum average amount of available financing per firefighter as prescribed by law. Note 2 "MEMORANDUM ONLY" PRESENTATIONS Presented in these financial statements are certain amounts labeled "memorandum only ". The reader is cautioned that this information has certain limitations. The "Total" column of the combined balance sheet presents a combining of unlike purpose funds and cannot be construed to be indicative of the overall financial position of the Association. Neither is such data comparable to a consolidation. Note3 CASH AND INVESTMENTS A. DEPOSITS Minnesota Statutes require that all deposits of the Relief Association be protected by insurance, surety bond, or collateral. The market value of the collateral pledged must equal 110% of the deposits not covered by insurance or bonds (140% in the case of mortgage notes pledged). Minnesota Statutes require that securities pledged as collateral be held in safekeeping by the treasurer or in a financial institution other than that furnishing the collateral. Authorized collateral includes the following: A) Certificates of deposit that are fully insured by federal agencies. B) Notes secured by fist mortgages of future maturity, upon which interest is not past due, on improved real estate free from delinquent taxes, within the county wherein the depository is located, or within counties immediately adjoining the county in the State of Minnesota. C) Obligations which are legally authorized investments for debt service funds under section 475.66, subdivision 3. D) Qualified state or local govemment obligations acceptable to the treasurer or chief financial officer. Qualified obligations must be general obligations rated "A" or better by Moody's Investors Service, Inc. or Standard & Poor s Corporation. At December 31, 1994, the carrying amount and bank balance of the Relief Association's deposits were $1,384 all of which were covered by federal depository insurance. Page 72