Investments

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Policy Number: FIN 511Policy Title: Investments
Supersedes: NewPolicy Owner: Vice-President, Finance & Corporate Services
Associated Procedure: Date Last Approved: July 15, 1989
1. Policy

The College will invest funds not immediately required for the purpose of maximizing investment income provided that,

1. the investment is included in section 12 (1) of Financial Administration Act (copy attached), and

2. the investment is for a term of not more than 12 months.

A report of investment activity will be provided to the Board of Governors, monthly.

2. Procedure

1. A cash forecast is prepared for the current academic year based on budget information. The forecast helps to identify monthly fluctuations in cash balances. Actual income and expenses are compared to the forecast to update it as often as is deemed necessary.

2. The forecast is a tool that is used when investing. A minimum monthly balance must be maintained in order to avoid an overdraft situation. The amount of the balance will depend on the College’s estimated cash flows.

3. The major source of our investments are Bank of Montreal and the Royal Bank. All five chartered banks are telephoned and the bank offering the highest rate of interest is where the investment is placed.

4. The College purchases three types of investments which are Treasury Bills, Banker’s Acceptance and Guaranteed Mortgages.

SECTION 12

(Sub-section 1)
of
THE FINANCIAL ADMINISTRATION ACT
(as amended)

(1) The Treasurer, when he considers it advisable for the sound and efficient management of public money or of public debt or of any sinking fund, may from time to time and on such terms and conditions as he considers advisable, purchase, acquire, and hold,

a) securities issued by or guaranteed as to principal and interest by Ontario, and other province of Canada, Canada or the United Kingdom;

b) securities issued by the United States of America;

c) securities issued or guaranteed by the international Bank for Reconstruction and Development payable in Canadian or United States currency; and

d) deposit, receipts, deposit notes, certificates of deposits, acceptances and other similar instruments issued or endorsed by any chartered bank to which the Bank Act (Canada) applies,

e) such other securities as may from time to time be authorized by the Lieutenant General in Council, and pay thereof out of the Consolidated Revenue Fund. 1968, C. 41, S. 10