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City of Lino Lakes, Minnesota
<br />Management Report, Page 3
<br />A schedule comparing the carrying value (book) and market value for investments is as
<br />follows:
<br />Carrying Market
<br />Value Value
<br />Investment 12/31/94 12/31/94 Difference
<br />Certificates of Deposit $490,083 $480,540 ($9,543)
<br />Commercial Paper 795,339 797,409 2,070
<br />FNMA Pool 2,210,290 2,226,359 16,069
<br />NOW Account 26,700 26,700
<br />GNMA 347,874 342,948 (4,926)
<br />FFCB 405,000 398,046 (6,954)
<br />FHLMC 1,439,255 1,411,390 (27,865)
<br />Treasury Securities 1,947,235 1,776,819 (170,416)
<br />FHLB 450,000 433,500 (16,500)
<br />Student Loan Marketing Association 300,000 300,000
<br />Certificates of Indebtedness 150,000 150,000
<br />Investment Pools: (Mutual Funds)
<br />MFS Government Maturity Fund 758,638 696,665 (61,973)
<br />MFS Government Security Fund 543,496 499,014 (44,482)
<br />Federated Fortress Adjustable Rate 672,947 647,889 (25,058)
<br />Fortress Adjustable Rate 815,887 773,686 (42,201)
<br />Delaware Treasury Reserves
<br />Intermediate Fund 276,561 241,167 (35,394)
<br />Total $11,629,305 $11,202,132 ($427,173)
<br />Accounting standards as they apply to governmental units require investments to be carried at
<br />cost. However, if declines in market value are deemed to be other than temporary, the carrying
<br />value of investments should be reduced to market value. The decrease in the market value of
<br />treasury securities is a result of the change in market interest rates. The City will realize full value
<br />of these investments if they are held to maturity. It is the City's intention to hold these investments
<br />until maturity.
<br />The market value of the mutual funds fluctuates with changes in interest rates. The City
<br />intends to monitor the market value of these funds and liquidate these funds once the market value
<br />has recovered.
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