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Investments Policy




This policy was adopted by the Board of Directors of Armagh Credit Union
Limited.

Signed:-

_______________________________ Position ________________


_______________________________ Position ________________








Date:










Policy Contents


Section 1: Policy Objectives

Section 2: Investment Governance

Section 3: Investment Compliance

Section 4: Investment Strategy

Section 5: Liquidity Management

Section 6: Taxation and Accounting

Section 7: Safekeeping

Authorised Signatories































Section 1 Policy Objectives

This policy sets out the guidelines that govern our Investment process.
Deposits and Investments comprise approximately 60% of the assets of the
credit union. Accordingly, it is vital that we have a prudent and robust
policy and process in place to ensure the proper management of these funds.
The key criteria that we use in assessing investment options and proposals
are:

Security - how safe is the investment? Will we get our money back when it
matures?

Liquidity - can we get access to our funds as and when required?

Yield - the need to generate a return in order to contribute to our Surplus
and to pay a good rebate to members.

The key driver of this policy is that we will not compromise security in
order to increase our yield, i.e. security is the primary consideration.


The Board of Directors of Armagh Credit Union Limited undertakes to review
this Investment Policy at least annually.

This policy should be read in conjunction with our Liquidity policy and our
Financial Risk Management policy.


Section 2 Investment Governance


1 Board of Directors

The Board of Directors of Armagh Credit Union Limited has the ultimate
responsibility for managing the Credit Union's surplus funds. This
responsibility includes

Development, implementation and on-going monitoring of a written investment
policy
The appointment of an investment committee
The approval of investments unless delegated to the Investment Committee.

2


3 Investment Committee

The roles and responsibilities of the Investment Committee include:
Ensuring that it has full knowledge and understanding of all regulations
relevant to credit union investments.
Ensuring that the investment portfolio of the credit union is compliant
with the relevant regulations and managed in accordance with the conditions
laid down in this investment policy.
The Investment Committee reports monthly to the Board of Directors on the
investment portfolio
The investment committee meets on a regular basis to review the investment
portfolio and to make investment decisions.
The investment committee has the authority to make investment decisions up
to a cumulative amount of ё500,000 between Board meetings for fixed term
deposits without prior Board approval, otherwise a special Board meeting is
called to deal with more complex investments. This is deemed necessary in
order to avail of investment opportunities that require a quick decision.
The committee reports its decision at the Board meeting immediately
following the investment decision.
The committee's composition will be reviewed and re-appointments made if
necessary on an annual basis or sooner if deemed necessary by the Board.
Armagh Credit Union Limited agrees that any two of the approved signatories
listed in this policy may sign on behalf of the Investments Committee.



Section 3 Investment Compliance


Compliance
All investments that we make will comply with the relevant regulations
(CREDS).

Product Type
Armagh Credit Union invests its surplus funds serving liquidity purposes
only in the following types of investments:

Deposits or loans to a UK domestic firm with Part IV permission to accept
deposits;
Deposits or loans to an institution which is authorised in any other EEA
State to accept deposits;
Sterling-denominated securities issued by the government of any EEA State;
Fixed-interest sterling-denominated securities guaranteed by the government
of any EEA State, provided that any guarantee is unconditional in respect
of the payment of both principal and interest on those securities.

Maturity Limits
All investments made by Armagh Credit Union will have a maturity date of
not more than 5 years from the date on which the investment is made. Non-
compliant investments that were in place prior to 31st March 2012 will
remain in place until maturity.


Section 4 Investment Strategy


Within the parameters of the relevant legislation, the overall investment
strategy of Armagh Credit Union is to ensure that surplus funds are used to
maximise investment returns while minimising any risks to member's funds.
The safety of these funds is paramount and is never compromised in order to
achieve a higher rate of return.

Each investment undertaken by the credit union is made only after the
committee has completed an analysis of the impact of the investment on the
portfolio in terms of:

The investment maturity profile of the credit union
The counter-party profile of the credit union
The asset allocation of the credit union

The portfolio is benchmarked against the Bank of England Rate. A formal
portfolio review will be undertaken where the benchmark is not met.


Section 5 Liquidity Management.

The credit union evaluates its liquidity using the following guidelines:

(1) Current Account Management: We aim to keep our current account balance
as low as is practically possible (since these accounts are non-interest
bearing or low interest accounts). This level is agreed at ё20,000 for the
First Trust Bank and ё 100,000 for Bank of Ireland.

It is agreed to instigate procedures, which automatically divert funds in
excess of this level to a higher interest bearing account offering similar
access. This is completed by the following procedure with Bank of Ireland
and First Trust Bank financial institutions:

*The Board retains ё20,000 cleared available funds in First Trust Bank and
ё 100,000 in Bank of Ireland and transfer to and from the call account as
required to maintain same.

(2) Liquid Funds: To comply with the FCA's guidelines with regard to
liquidity, Armagh Credit Union will always hold liquid assets of a value at
least equal to 10% of total relevant liabilities. Total relevant
liabilities are defined by us as Unattached Shares plus Minor's Deposits
plus Creditors plus Short Term Loans. Liquid assets are assets that can be
realised for cash within (at most) eight days. For the purposes of meeting
this requirement, liquid assets are valued at the amount for which they
could be realised within eight days. Long Term Investments are ignored in
any calculation.

(3) Dependency Level: The ratio of unattached shares of the top 50
shareholders / total unattached share balance shows the level of dependency
for funding associated with key shareholders. For prudent liquidity
management Armagh Credit Union Limited will endeavour to keep this ratio
below 20%

(4) Forecasting: Armagh Credit Union will undertake to conduct a
forecasting review of liquidity on an annual basis. This review will
examine the following:

Current available funds
Future projected cash inflows and outflows
Estimated share and loan balances
Future capital expenditure plans
Exceptional items





Section 6 Taxation and Accounting Treatment



1 Taxation

It is the understanding of Armagh Credit Union Limited that credit unions
in N. Ireland are:

Liable for corporation or income tax on their Investment Income.
Liable for capital gains tax when a capital gain forms part of the income
of the credit union.



Armagh Credit Union Limited will seek professional advice as required and
appropriate when making decisions regarding taxation obligations.


1 Accounting Treatment


Armagh Credit Union's policy on accounting for Investments will comply with
generally applicable accounting standards, statutory and regulatory
guidelines. Investments are valued in our Balance Sheet at the lower of
cost and net realizable value. Unrealised gains are not included in our
Income & Expenditure Account.





Section 7 Safekeeping


Investments are to be held in the name of Armagh Credit Union Limited.
The investment committee will ensure that the appropriate documentation is
received for each investment.
This documentation includes lodgment and withdrawal confirmations and
monthly statements, where appropriate, showing interest and other changes
in investment value for that period.












Investment Authorised Signatories

The Investment Committee authorized signatories of Armagh Credit Union
Limited as at 1 March 2015 are as follows:

|NAME |POSITION |SIGNATURE |
|BOARD/ INVESTMENT COMMITTEE | | |
|Gerry Doyle |PRESIDENT | |
|Richard Smyth |TREASURER | |
| Denis Hughes |SECRETARY | |
| | | |

In the event that one of the above can not attend the meeting, then the
following person may deputise.


| Bridie Ryan |VICE PRESIDENT | |
| | | |