1. Responsibilities Relating to Government Investment Accounts (The Operating Circular) Fiscal Service Department of the Treasury

2. Background l Number of Investment Funds l Growth of Dollars

3. Growth * Congressional Budget Office projection Dollar Amounts (in Billions) Year

4. Background l Number of Investment Funds l Growth of Dollars l Degree of Sophistication l Need to Provide Guidance

5. Investment Fund Review of 2000 l Look at Treasury’s handling of Investment Fund Responsibilities l Document Policies and Practices l Identify Improvement and Enhancements

6. Review Recommendations l Better Coordination and Communication with User Group Agencies l Develop an Office within Treasury Dedicated to Investment Fund Operations l Define Responsibilities and Procedures for Both Treasury and Program Agencies –Operating Circular

7. What the Operating Circular Does l Description of Program Agency Responsibilities l Description of Treasury Responsibilities l Description of Current Practices for Investment Activity l Provides Links to Treasury Web Sites for More Detailed Instructions –Disbursing / SF 224 Reporting

8. Applicable Funds 4 Agency-Managed Investment Funds but Ø Treasury-Managed Investment Funds Ø Deposit Funds

9. Why an Operating Circular l Procedural Manual and Offering Circular l Posted on the Internet l Linked to Other Treasury Guidance –Treasury Financial Manual –Bureau of the Public Debt Web Site l Ability to be Updated

10. Major Functions of Investment Fund Administration - Investment Funding of Accounts Funding of Accounts Establishment of Investment Accounts Establishment of Investment Accounts Investment

11. Investment - Policies l Investment requires authorization l Appropriated fund will only be invested if required by statute l Only available moneys may be invested l Treasury sells only Treasury securities (no agencies securities) l Par-value securities are only available to agencies when required by statute

12. Investment - Policies (cont.) l Agencies should practice a “buy and hold” policy l No day-trading or large-scale restructuring of portfolios l Generally, agencies must dis-invest before borrowing from Treasury / FFB l Agencies need to sign an MOU before purchasing ZCBs

13. Investment - Securities l Offering Circular –Description of the Securities offered by Treasury l Market-based bills, notes and Bonds l Additional market-based securities l Par-value securities l Terms and conditions l Pricing methodology –Appendix A

14. Investment - Procedures l Duties of the program agencies –Investment Strategy –Amount to Invest l Procedural guidance –Forms and instructions –Timeframes –Confirmations

15. Major Functions of Investment Fund Administration - Reporting Accounting Redemption Funding of Accounts Funding of Accounts Establishment of Investment Accounts Establishment of Investment Accounts General Gov’t Reports on Investment Fund Activity General Gov’t Reports on Investment Fund Activity Investment Disbursement

16. Scope of the Operating Circular 4 Activity relating to the creation, investment, redemptions and accounting of Federal agency account with investment authority Ø Program Responsibilities are not included in Operating Circular

17. Updating the Operating Circular l Updated on an “as needed” basis –Procedural changes –Changes in securities offered l Posted on BPD web site l Change Log l Subscription Service

18. Contacts l Office of Investment Fund Administration –Carl MaryottDan Decena –(202) 622-1795(202) 622-0637 l Bureau of the Public Debt –Division of Federal Investments –(304) 480-5111