Effective: April 1, 2016
Applicable FAM Policies: 420 Investments
Applicability: GNWT Departments and Public Agencies

INTERPRETATION

The types of investments and eligible investment issuers are restricted to those specified in sections 51, 52 and 53 of the Financial Administration Act (FAA), which allows the Minister of Finance on behalf of the commissioner, or a Public Agency, to invest money in credit of the Consolidated Revenue Fund.

Investments may only be made as follows:

1. in the classes of securities, investments and loans outlined in FAA and in accordance with the Investment Regulations; and,
2. only from issuers approved by the Deputy Minister of Finance.

Concentration of investments in the securities of any one issuer must not exceed the maximum limits (expressed as either total dollars or proportion of portfolio) authorized by the Deputy Minister of Finance.

The term to maturity of investments must be limited to the maximum terms established by the Deputy Minister of Finance.

Investments may only be transacted through banks and investment dealers approved by the Deputy Minister of Finance.

Departments and Agencies shall develop and maintain controls to protect the Government from fraud and major error on its investment activities.

Capital Preservation, Liquidity and Rates of Return

Surplus funds are to be invested in a manner that preserves capital and maintains liquidity. These are the primary goals in investing the Government's surplus funds. Maximizing rates of return is a goal secondary to the primary goals.

Investments should mature or be redeemable in order to make funds available when required for the Government to meet its payment obligations.