870173 TMRS CAFR new8 fix 049-081.qxd - Texas Municipal ...

NOTES TO FINANCIAL STATEMENTS
CONTINUED
The System’s investments in fixed income securities at December 31, 2004 and 2003, are summarized below:
2004
2003
FAIR VALUE COST FAIR VALUE
COST
U.S. Treasury $ 4,101,185,258 $ 4,217,762,505 $ 3,911,419,112 $ 4,272,739,592
U.S. government agency 3,678,232,636 3,582,216,535 4,247,913,667 4,387,832,294
State/local government 618,096,198 606,383,820 - -
Corporate 2,718,887,371 2,394,564,541 2,142,704,263 1,900,324,572
Totals $ 11,116,401,463 $ 10,800,927,401 $ 10,302,037,042 $ 10,560,896,458
As of December 31, 2004 and 2003, the System did not own obligations of a single corporation representing
5% or more of the net assets held in trust for pension benefits.
4. CASH
Demand deposit accounts held by the institution
totaled $6,126,180 and $272,825, with carrying
amounts of ($2,740,639) and ($12,091,388) at
December 31, 2004 and 2003, respectively. Securities
pledged had a market value of $12,639,158 and
$2,264,533 at December 31, 2004 and 2003, respectively.
The account, Due to Depository Bank (book
overdraft), consists of annuity, refund, and supplemental
death benefit checks outstanding at December 31,
2004 and 2003.
5. CREDIT RISK
GASB Statement No. 3 Deposits with Financial
Institutions, Investments (including Repurchase
Agreements) and Reverse Repurchase Agreements
requires that deposits and investments be categorized
to provide an indication of the level of credit risk
assumed at the end of the reporting year.
The three categories of credit risk for deposits are
as follows:
• Category 1: Insured or collateralized, with securities
held by the System or its agent in the
System’s name.
• Category 2: Collateralized, with securities held
by the pledging financial institution’s trust
department or agent in the System’s name.
• Category 3: Uncollateralized.
All of the System’s demand deposit accounts are
held by a local banking institution under terms of a
written depository contract. All deposits as of
December 31, 2004 and 2003, to the extent not
insured by Federal depository insurance, were collateralized
by securities held by a third party independent
custodian, in the System’s name under a joint custody
agreement giving the System unconditional rights and
claims to collateral.
The three categories of credit risk for investments
are as follows:
• Category 1: Investments that are insured or registered,
or securities held by the System or its
agent in the System’s name.
• Category 2: Investments that are uninsured and
unregistered, with securities held by the counterparty’s
trust department or agent in the
System’s name.
• Category 3: Investments that are uninsured and
unregistered, with securities held by the counterparty,
or by its trust department or agent, but
not in the System’s name.
T M R S COMPREHENSIVE ANNUAL FINANCIAL REPORT 2004
41