HomeMy WebLinkAbout2008-01-08 - Finance-Accounting Committee Meeting Agenda PacketHL
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YORBA LINDA WATER DISTRICT
FINANCE - ACCOUNTING COMMITTEE MEETING
Tuesday, January 8, 8:30 a.m.
4622 Plumosa Drive, Yorba Linda - Tel: (714) 701-3020
AGENDA
COMMITTEE:
Director William R. Mills, Chair
Director Michael J. Beverage
Alternate: Director John W Summerfield
STAFF:
Michael A. Payne, General Manager
Diane Cyganik, Finance Director
Sandi Van Etten, Sr. Accountant
INTRODUCTION OF VISITORS AND PUBLIC COMMENTS:
Any individual wishing to address the Committee is requested to identify themselves and state the matter on which
they wish to comment If the matter is on this agenda, the Committee Chair will recognize the individual for their
comment when the item is considered. No action will be taken on matters not listed on this agenda. Comments are
limited to matters of public interest and matters within the jurisdiction of the Water District. Comments are limited to
five minutes
ACTION ITEMS:
This portion of the agenda is for items where staff presentations and committee discussions are needed
prior to formal committee actions.
Termination of Professional Services Agreement with Charles Z. Fedak &
Company.
Recommendation: That the Committee recommend that the Board of
Directors terminate the Professional Services Agreement with Charles Z.
Fedak & Company and that the Buaid of Directors autlwrize staff to sohcii
proposals for new independent auditors.
DISCUSSION ITEMS:
This portion of the agenda is for matters such as technical presentations, drafts of proposed policies, or similar items
for which staff is seeking the advice and counsel of the Committee Members. This portion of the agenda may also
include items for information only.
2. Water Rate Report - 2008.
3. Investment Report for month ending November 30, 2007.
4. Monthly Report on Investments Ending December 31, 2007. Report of Keith
Khorey, Wells Capital Management.
ADJOURNMENT:
The next Finance-Accounting Committee meeting is scheduled for February 12, 2008 at
4:00 p.m.
Accommodations for the Disabled.
Any person may make a request for a disability-related modification or accommodation needed for that perscr, to be
able to participate in the public meeting by telephoning Michael A. Payne, District Secretary, at 714-701-3020, or
writing to Yorba Linda Water District, P.O Box 309, Yorba Linda, CA 92885-0309. Requests must specify the
nature of the disability and the type of accommodation requested. A telephone number or other contact information
should be included so the District staff may discuss appropriate arrangements. Persons requesting a disability-
related accommodation should make the request with adequate time before the meeting for the District to provide
the requested accommodation.
-2-
ITEM NO.
AGENDA REPORT
Committee Meeting Date: January 8, 2008
To: Finance-Accounting Committee
From: Michael A. Payne, General Manager
Staff Contact: Diane Cyganik,Finance Director
Reviewed by General Counsel: N/A Budgeted: Yes Total Budget: $43,500
Funding Source: Water Operating Fund
CEQA Account No: 133780 Job No: N/A
Compliance: N/A Estimated Costs: Unknown Dept: Bus
Subject: Termination of Professional Services Agreement with Charles Z. Fedak & Company
SUMMARY:
Charles Z. Fedak & Company, the District's Independent auditors, recently completed their
second year of a three year contract with the District for the fiscal year ending June 30, 2007.
The Professional Services Agreement is for a term of three (3) fiscal years with the option of
auditing the District's financial statements for two (2) subsequent fiscal years.
DISCUSSION:
The District is not pleased with the level of service provided by Charles Z. Fedak & Company
over the past two years. Staff would like to terminate the professional services agreement and
be given authorization to solicit proposals for new independent auditors. The current agreement
has provisions for early termination.
The District's current policy is to enter into multi-year agreements of not more than five (5) years
in duration when obtaining the services of independent auditors.
PRIOR RELEVANT BOARD ACTION(S):
On May 2, 2006, the Board of Directors Agreement approved a professional services agreement
with Charles Z. Fedak & Company for the District's Independent Audit services.
STAFF RECOMMENDATION:
That the Finance-Accounting Committee recommend to the Board of Directors approval to
terminate the Agreement with Charles Z. Fedak & Company and to authorize staff to solicit
requests for proposals for new independent auditors.
0
ITEM NO.
AGENDA REPORT
Committee Meeting Date: January 8, 2008
To: Finance-Accounting Committee
From: Michael A. Payne, General Manager
Staff Contact: Diane Cyganik, Finance Director
Sandi Van Etten, Senior Accountant
Reviewed by General Counsel: N/A Budgeted:
Funding Source:
CEQA Account No:
Compliance: N/A Estimated Costs:
Subject: Investment Report for November 2007
N/A Total Budget: N/A
N/A
Job No:
N/A Dept:
3
SUMMARY:
Government Code Section 53607, et, seq., requires the person delegated to invest funds to
make a quarterly report of the investments to the legislative body.
DISCUSSION:
I am submitting the November 2007 monthly investment report for your information. I will submit
a formal report of the investments for Board action for the quarter ending December 31, 2007
upon approval of the Investment Report.
Below is a chart summarizing the yields as well as terms and maturities for the month of
November 2007:
Avg.
Avg. Portfolio
Portfolio
# of
Avg. Term
Month Yield With Out
Yield With
Days to
of
Portfolio in
of 2007 Wells Capital
Wells Capital
Maturity
Days
November 3.49%
4.45%
172
61
The interest earned in the month of November 2007 is $116,890. The total interest received as
of November 30, 2007 for fiscal year 2007/2008 is $605,458. The investment interest
comparison is listed below:
Investment Summary Comparison
Actual for the Month of 11/30/06 11/30/07
Monthly Interest $ 129,719 $ 116,890
Year-to-Date $ 626,772 $ 605,458
Fiscal Year 2006/2007 2007/2008
Interest Budget $333,470 $86,000
Interest earned on investments is recorded in the Fund that owns the investment. The
distribution of investments in the portfolio both in dollars and as a percentage of the total
portfolio by funds is as follows:
As of 11 /30/07
Fund Description
$
%
Annexation Fees
$ 15,633,251
49.50%
Water Fund
-2,179,537
-6.90%
Sewer Fund
1,166,724
3.69%
Revenue Fund
2,817,217
8.92%
Imp. Dist. No. 1
4,594,589
14.55%
Imp. Dist. No. 2
9,552.792
30.24%
$31.585.036
100.00%
PRIOR RELEVANT BOARD ACTION(S):
These reports are presented to the Finance-Accounting Committee on a regular basis. Quarterly
Investment Reports are presented to the Board of Directors.
STAFF RECOMMENDATION:
That the Finance-Accounting Committee receive and file the report.
Yorba Linda Water District
Investment Portfolio Report
November 30, 2007
Market
Value Cost
Certificates ofDenosit:
$ 100,000 100,000
$ 100,000 $ 100,000
% Institution
Pacific Western
0.32% Total Certificates of Deposit
Percent Investment Maturity
Yield Date Date
4.05% 02/04/05 02/04/08
4.05%
Cash c& Checking Accounts:
$ 1,334,032 $ 1,334,032
1,200 1,200
$ 1,335,232 $ 1,335,232
Wells Fargo Bank
Imprest Cash
4.24% Total
Monev Market Accounts:
$ 1,186,059 $ 1,186,059 Wells Fargo Money Market
384,281 384,281 Wells Fargo MM/Annexation
$ 1,570,340 $ 1,570,340 4.99% Total
$ 3,005,572 $ 3,005,572 9.55% Sub-total
Ore Co Commingled Investment Pool.
$ 129,856 $ 129,856 0.41% Orange County Commingled Fund
N/A
0.00%
2.06% N/A
2.06%
2.06%
1.21%
5.24%
N/A
Cah6prnia A('bitraee Memt. Proeram:
$ 6,450,243 $ 6,450,243 20.49% California Arbitrage Mgmt. Program 4.94%
Monev Market Account:
$ 2,817,217 $ 2,817,217 8.95% US Bank/Revenue Bond
$ 12,402,888 $ 12,402,888 39.40% Sub Total Investments
Individual Management Account:
N/A
2.51% N/A
3.49%
$ 19,074,555
$ 19,078,808
60.60% Wells Capital Management
5.07% N/A
$ 31,477,443
$ 31,481,696
100% Total Investments
4.45%
Per Government Code requirements, the Investment Report is in compliance with the Yorba Water District's
Investment Policy and there are adequate funds available to meet budgeted and actual expenditures for the
six months.
Sandi Van Etten, Senior Accountant
11/30/07
ITEM NO.
Account Overview
Yorba Linda Water District
Funding Date: 10/25/2005
Portfolio Statistics as of: 12/31/2007
Account Characteristics:
Portfolio Yield to Maturity 5.12%
Total Unrealized Gains/(Losses) - Current: (8,757)
Total Net Realized Gains/(Losses) - Since Inception: 496
Total Long-Term Investments: -
Total Short Duration Investments/Money Market Secs: 19,129,721
Total Market Value: 19,129,721
Total Number of Issues in the Portfolio: 12
MARKET DATA
Overnight Fed Funds Rate: 4.25%
6-Month T-Bill Yield: 3.29%
12-Month T-Note Yield: 3.00%
WELLS CAPITAL MANAGEMENT
Portfolio Summary Report Vorba Linda Water District
For the period : 12/01/07 to 12/31/07 18611500
Portfolio Characteristics
Market Value:
Unrealized G /L:
Yield To Maturity:
Portfolio Duration:
Avg. Days to Maturity:
Avg. Portfolio Credit Quality:
Market Data
Yields.
6 Month Treasury Bill:
2 Year Treasury Note:
5 Year Treasury Note:
Fed Funds Target:
Credit Quality*
P1 /MIG1/VMIG1 /A -1
Aaa /AAA
Aa /AA
A/A
Baa /BBB
Other
Cash /Overnights
Not Rated
12/31/07
3.39%
3.05%
3.44%
4.25%
4.6%
25.7%
12.8%
10.1%
0.0%
0.0%
46.7%
0.0%
100.0%
11/30/07
3.35%
3.00%
3.38%
4.50%
Effective Maturity Distribution
0.50
0.40
0.30
0.20
0.10
' Moody's Ratings - Primary
S&P Ratings - Secondary
Fitch Ratings - Tertiary 0 00
o/n 2 to 90 91 to 180 181 to 1 year 1 to 2 years 2 years
The above information is an estimate of certain investment calculations and does not represent your audited statement of record.
Market Value % of Account
1,421,725.00
Portfolio Breakdown
19,129,721.16
4.65%
(8,756.66)
Agency Discount Note
3,502,187.50
Commercial Paper
5.12%
Corporate Obligation
0.10 Years
Gov Agncy Obligation
Money Market Fund
82
Pending_Cash
Aa1
Total
12/31/07
3.39%
3.05%
3.44%
4.25%
4.6%
25.7%
12.8%
10.1%
0.0%
0.0%
46.7%
0.0%
100.0%
11/30/07
3.35%
3.00%
3.38%
4.50%
Effective Maturity Distribution
0.50
0.40
0.30
0.20
0.10
' Moody's Ratings - Primary
S&P Ratings - Secondary
Fitch Ratings - Tertiary 0 00
o/n 2 to 90 91 to 180 181 to 1 year 1 to 2 years 2 years
The above information is an estimate of certain investment calculations and does not represent your audited statement of record.
Market Value % of Account
1,421,725.00
7.43%
888,909.75
4.65%
4,381,832.60
22.91%
3,502,187.50
18.31%
8,935,066.33
46.71%
-0.02
0.00%
19,129,721.16 100.00%
YORBA LINDA WATER DISTRICT
Statement of Cash Flows/Earnings for December 2007
1 - Beginning Period Balances
Total Original Cost
+ Net Amort/Accr to Date
=Adjusted Book Value:
+ Accrued Interest Receivable
+ Unrealized Gain/(Loss)
= Total Market Value Plus Accrued Interest
II: Period Income Earned
+ Ending Accrual
- Begininning Accrual
+ Interest Received
- Interest Paid at Purchase
+ Interest Received at Sale
= Interest Earned in Period
+ (Amort)/Accr This Period
= Monthly Portfolio Income
+ Contributions
- Withdrawals
+ Realized Gain/(Loss)
- Fees Paid This Period
- Prior Period Unrealized Gain/Loss
+ End Of Period Unrealized Gain/Loss
+ Net Receipts/Deliveries in Kind
+ Adjustments
= Net Change to the Portfolio
=Total Market Value Plus Accrued
Interest
III: End of Period Balances
Total Original Cost
+ Net Amort/Accr to Date
= Adjusted Book Value
+ Accrued Interest Receivable
+ Unrealized Gain/(Loss)
= Total Market Value Plus Accrued
Interest
Reconciliation Difference:
As of 11/30/2007
19,020,914
57,895
19,078,808
107,594
(4,253)
19,182,149
126,399
(107,594)
52,093
70,8981
10,752
$ 81,6491
(3,175)
(4,253)
(8,757)
0.00
0.00
3,0741
19,256,120
As of 12/31/2007
19,075,493
62,985
19,138,478
126,399
(8,757)
19,256,120
Wells Capital Management
Holdings Report
Securities Held as of 12/31/07 on a Trade Date Basis
Identifier Credit Ratings
Par Value Security Description
Coupon
Final
AGY AGY
300,000 FNMA
0.00%
Maturity
Moody's S &P Fitch
Money Mkt Securities
46.71%
4.99%
I. Cash & Cash Equivalents (Original maturity of 90 days or less)
8,970,251
46.71%
Cash
AGY AGY
3,500,000 FNMA
313588YRO AGY
U.S. DOLLARS
(0) PENDING CASH
Commercial Paper
398,191
400,058
(0)
A -1 F -1
900,000 LAFAYETTE ASSET
Money Mkt Securities
696,093
2.350.000
326
Agency Discount Note
99268
53
645,244
Commercial Paper
221
0.11
99.840
Money Market Fund
449,280
452,639
302
VP7000038
8,935,066 WF ADV MONEY MKT TR #645
4.993
698,158
Cash & Cash Equivalents Total
8.935,066
0.10
0.000
11. Marketable Securities (Original maturity greater than 90 days)
4,381,833
4,409,085
IIA: Short Term Securities (Remaining maturity of less than 365 days)
98.768
888,910
Corporate Securities
4.65%
5.43%
Corporate Obligation
147
0.39
073902HB7 A2 A A+
400,000 BEAR STEARNS CO INC
5.161
04/29/08
38141EKG3 Aa3 AA- AA-
700.000 GOLDMAN SACHS GROUP INC
5.111
07/29/08
40429CCU4 Aa3 AA- AA-
400,000 HSBC FINANCE CORPORATION
5.824
09/15/08
52517PJ28 Al A+ AA-
400,000 LEHMAN BROTHERS HOLDINGS
5.092
05/29/08
59018YVZI Al A+ A+
700,000 MERRILL LYNCH & CO
5.105
08/22/08
617446A82 Aa3 AA- AA-
650,000 MORGAN STANLEY
4.972
11/21/08
7591EPAB6 Al A A+
450,000 REGIONS FINANCIAL CORPORA-
4.978
08/08/08
929903AQ5 Aa3 AA- AA-
700.000 WACHOVIA CORP
5.034
10/28/08
4,400,000
Govt Securities
Gov Agncy Obligation
31359MH71 AGY
AGY AGY
3,500,000 FNMA
31359MZN6 AGY
AGY AGY
300,000 FNMA
0.00%
0.00%
3,800.000
Money Mkt Securities
46.71%
4.99%
Agency Discount Note
8,970,251
46.71%
31359MH71 AGY
AGY AGY
3,500,000 FNMA
313588YRO AGY
AGY AGY
1,450,000 FNMA
Commercial Paper
398,191
400,058
50285LD43 P1
A -1 F -1
900,000 LAFAYETTE ASSET
3,826,025
696,093
2.350.000
Short Term Securities Total 10,250,000
IIB: Long -Term Securities (Remaining maturity greater than 365 days)
Yorba Linda Water District
18611500
Effective Days Duration Market Pnce Market Market Value Holdings as YTM at
Maturity to Eff Value + Accrued Percentage of Purchase
Maturity Interest Account or Reset
01/01/08
04/29/08
07/29/08
09/15/08
05/29/08
08/22/08
11/21/08
08/08/08
10/28/08
(0)
(0)
0.00%
0.00%
0 0.00 0
0
0.00%
0.00%
1 0.00 100.000 8,935,066
8,970,251
46.71%
4.99%
1 0.00 8,935,066
8,970,251
46.71%
4.99%
120
0.08
98.996
145
395,986
399,655
211
0.08
99.867
5.29%
699,072
705,432
259
0.21
99.952
100.000
399,810
400,780
150
0.16
99.548
398,191
400,058
235
0.11
99.442
3,826,025
696,093
699,965
326
0.06
99268
53
645,244
646,231
221
0.11
99.840
5.29%
449,280
452,639
302
0.07
99.737
98.050
698,158
704,324
238
0.10
0.000
04/04/08
4,381,833
4,409,085
2.07% 5.16%
3.65% 5.11%
2.09% 5.82%
2.08% 5.09%
3.64% 5.11%
3.37% 4.97%
2.35% 4.98%
3.65% 5.03%
22.91% 5.13%
5.100
02/22/08
02/22/08
145
0.39
100.063
3,502,188
3,521,525
17.84%
5.29%
5.000
12/13/07
12/13/07
74
0.21
100.000
300.000
304,500
1.53%
5.38%
139
0.38
3,802,188
3,826,025
19.37%
5.30%
5.100
02/22/08
02/22/08
53
0.14
100.063
3,502,188
3,566,150
18.31%
5.29%
0.000
06/27/08
06/27/08
179
0.48
98.050
1,421,725
1.421,725
7.43%
5.26%
0.000
04/04/08
04/04/08
95
0.25
98.768
888,910
888,910
4.65%
5.43%
147
0.39
2.310,635
2.310.635
12.08%
5.33%
154
0.18
10,194,655
10,285,870
53.29%
5.23%
The above information is an estimate of certain investment calculations and does not represent your audited statement of record. Page: 1 of 2
Holdings Report
Securities Held as of 12/31/07 on a Trade Date Basis
Identifier Credit Ratings Par Value
Moody's S&P Fitch
Corporate Securities
Corporate Obligation
Long Term Securities Total 0
Marketable Securities Total 10,250,000
19,185,066
Yorba Linda Water District
18611500
Security Description Coupon Final Effective Days Duration Market Price Market Market Value Holdings as YTM at
Maturity Maturity to Eff Value + Accrued Percentage of Purchase
Maturity Interest Account or Reset
0 0.00 0 0
154 0.18 10,194,655 10,285,870
82 0.10 19,129,721 19,266,120
0.00% 0.00%
53.29% 5.23%
100.00% 5.12%
The above information is an estimate of certain investment calculations and does not represent your audited statement of record. Page: 2 of 2