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6.G. - PaRedwoocT$i7 <br />City <br />Notes to the Basic Financial Statements <br />For the fiscal year ended June 30, 2018 <br />NOTE 2 - CASH AND INVESTMENTS (CONTINUED) <br />B. Investments, Continued <br />As of June 30, 2018, the City had $83,079,550 (estimated fair value) invested in LAIF. LAIF had invested <br />2.89% of the pool investment funds in Structured Notes and Asset -Backed Securities. LAIF determines <br />fair value on its investment portfolio based on market quotations for those securities where market <br />quotations are readily available and based on amortized cost or best estimate for those securities where <br />market value is not readily available. The City valued its investments in LAIF as of June 30, 2018, by <br />multiplying its account balance with LAIF times a fair value factor determined by LAIF. The fair value <br />factor was determined by dividing all LAIF participants' total aggregate fair value by total aggregate <br />amortized costs. <br />Accordingly, as of June 30, 2018, the City's investment in LAIF at fair value amounted to $83,079,550 <br />using a LAIF fair value factor of 0.998126869. The fair value of the City's position in the pool is materially <br />equivalent to the value of the pool shares. <br />The City is also a voluntary participant in the San Mateo County Investment Fund that is regulated by <br />California Government Code Section 16429 under oversight of the Treasurer of the County of San <br />Mateo. The City reports its investment in the San Mateo County Investment Fund at the fair value <br />amount provided by County of San Mateo. Included in the San Mateo County Investment Fund <br />investment portfolio are US Treasury Notes, Obligations issued by agencies of the United States <br />Government, LAIF, Corporate Notes, Commercial Paper, collateralized mortgage obligations, mortgage- <br />backed securities, other asset-backed securities, and floating rate securities issued by federal agencies, <br />government-sponsored enterprises, repurchase agreements, and corporations. <br />Investment Valuation <br />Investments (except for money market accounts, time deposits, and commercial paper) are measured at <br />fair value on a recurring basis. Recurring fair value measurements, are those that Governmental <br />Accounting Standards Board (GASB) Statements require or permit in the statement of net position at the <br />end of each reporting period. Fair value measurements are categorized based on the valuation inputs <br />used to measure an asset's fair value: Level 1 inputs are quoted prices in active markets for identical <br />assets; Level 2 inputs are significant other observable inputs; Level 3 inputs are significant unobservable <br />inputs. Investment fair value measurements at June 30, 2018 are described on the following page. <br />Investments included in LAIF and San Mateo County Pool as well as restricted cash and investments <br />included money market accounts and guaranteed investment contracts are not subject to fair value <br />measurement. <br />52 258 <br />