Investment Accounting (IA) facilitates the flow of cash between the custodial bank, outside investment managers, General Partners, and the Treasury-managed Oregon Short Term Fund, which includes the Local Government Investment Pool. IA assists the Treasury Investment team by providing a daily forecast of investment related cash inflows and needs, helping to insure liquidity within the context of maximizing investment opportunities in the short term. IA also reconciles all cash flows between the custodian bank and the private equity consultant for accuracy and appropriate accounting treatment.
IA serves as the reporting interface between the custodial bank and the ten state agencies that own investments under OST management. In carrying out this function, IA assists agencies in accessing daily and monthly accounting reports produced by the custodial bank to enable them to record investment activity within their accounting systems. IA members also assist at the statewide level in monitoring the size of the state’s General Fund and provide information to bonding officials regarding cash flows and the availability of intra- and interfund loans for the General Fund. This information is critical to the process of issuing Tax Anticipation Notes (TANs).
Investment Accounting leads the statewide effort in reporting investments under OST management in accordance with GAAP. This involves maintaining an awareness of the practices and reporting principles for investment classification, valuation, securities lending, derivatives, and risk. IA staff work closely with agencies and their auditors, both internal and external to the State, to ensure that all relevant investment information is available and clearly presented. Six of IA’s customer agencies produce their own financial statements, which are audited independently, while the remaining agencies are only reflected with the statewide financial statements. IA also contributes significant effort in assisting the central statewide reporting unit in supporting investment balances and supplying needed information for disclosure notes. Similarly, IA prepares the annual OSTF financial statements in accordance with the reporting requirements for external investment pools. These statements must pass the rigors of an audit conducted by the Oregon Audits Division.
Income and Expense Analysis
Investment Accounting plays an integral role in analyzing the income generated by the OSTF and the size of the allowance for impaired investments, both of which impact the rate paid to fund participants. On the expense side, IA reviews investment manager and General Partner management fees and other investment expenses to ensure that fees are calculated in accordance with contract terms.
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