village of wellington, florida

Wellington’s investment strategy is promulgated within the framework of an investment policy whichestablishes a conservative set of investment criteria that prudently protects Wellington’s principal andenables Wellington to generate a fair rate of return from its investment activities. The primary focus ofWellington’s investment policy is the safeguarding of public assets by minimizing credit and market risk.Wellington uses a pooled cash concept for the funds under its control. Wellington invests in thoseinstruments authorized by State Statutes, Village resolutions, and applicable bond resolutions. Wellington’stemporarily idle cash was invested within the guidelines of the adopted investment policy in money marketmutual funds and U.S. Treasury securities. Wellington’s invested funds achieved an annual average rate ofreturn of 3.8%, resulting in total investment income of $5.1 million in 2009.Debt Service AdministrationIn Florida, there is no legal debt limit. All general obligation debt pledging payment from ad valorem taxesmust be approved by referendum, unless it is to refund outstanding debt. Article VII, Section 12, of theFlorida State Constitution states “Counties, school districts, municipalities, special districts, and localgovernmental bodies with taxing powers may issue bonds, certificates of indebtedness, or any form of taxanticipation certificates payable from ad valorem taxes and maturing more than twelve months afterissuance only to finance or refinance capital projects authorized by law and only when approved by vote ofthe electors …” Wellington has no general obligation debt outstanding.All applicable debt covenants such as ratios of net income to debt service, sinking funds and insurancecoverage have been met or exceeded. Wellington has an underlying bond rating of Aa3 from Moody’sInvestors Services and AA from Fitch based on the financial stability of Wellington.Risk ManagementRisk management is the systematic, logical, and continuous process which identifies exposures to differenttypes of losses, evaluates the potential cost of these losses, and identifies the most cost effective method ormethods to deal with them. These methods include reducing or eliminating the risk by sound loss controland safety practices. Wellington has traditionally financed loss exposures through conventional insurancewith varying levels of retention. An active and ongoing risk management program along with loss controlmeasures is coupled with an annual evaluation of the methods of financing the exposure, to produce whatWellington feels is an effective and efficient program.Wellington purchases insurance coverage for workers compensation, property damage and general liabilitythrough the Florida League of Cities insurance program, which assumes all risk of loss up to the policymaximum. Insurance coverage is evaluated annually by management and adjusted as necessary to providethe most cost effective protection for Wellington.Independent AuditAn audit of Wellington’s financial records, as required by State Statutes and the Village Charter, wasperformed by the independent certified public accounting firm Caler, Donten, Levine, Porter & Veil, P.A.The auditors’ report on the financial statements is included in the financial section of this report.AwardsThe Government Finance Officers Association of the United States and Canada (GFOA) awarded aCertificate of Achievement for Excellence in Financial Reporting to the Village of Wellington, Florida, forits Comprehensive Annual Financial Report for the fiscal year ended September 30, 2008. The Certificate ofAchievement is a prestigious national award recognizing conformance with the highest standards forpreparation of state and local government financial reports.xi