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17 <br />SELECTION OF SECURITIES <br />The Financial Services Director will determine which instruments shall be purchased and sold <br />and the desired maturity date(s) that are in the best interest of the County. The selection of an <br />instrument will involve the evaluation of, but not be limited to, the following factors: <br />A. Cash flow projections and requirements. <br />B. Current market conditions. <br />C. Overall portfolio balance and makeup. <br />CUSTODY AND SAFEKEEPING OF SECURITIES <br />Orange County will maintain a third party safekeeping account for all investments (generally <br />provided by the County's primary bank). Transactions should be processed on a delivery <br />versus payment basis. Some securities, primarily certificates of deposit, will not be kept iri the <br />third party safekeeping account, but will be kept by the Financial Services Director in the vault <br />of the Finance Services Department. <br />INTERNAL CONTROLS <br />The Financial Services Director is responsible for establishing a system of internal controls. <br />These controls are designed to prevent losses of public funds arising from fraud, employee <br />error, and misrepresentation by third parties or imprudent actions by County employees. <br />REPORTING <br />The Financial Services Director shall maintain a monthly investment report. The report shall <br />include a general description of the portfolio in terms of investment securities, maturities, yields <br />and other features. The report will show investment earnings for the month and fiscal year-to- <br />date, including the annualized earned yield percentage for the portfolio. The report will <br />compare actual investment earnings with budgeted earnings. <br />4 <br />