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Elk River Municipal Utilities <br />Elk River, Minnesota <br />Notes to the Financial Statements <br />December 31, 2019 <br />Note 2:Detailed Notes on All Funds (continued) <br />Investments <br />The Utilities’ investment balances were as followsfor December 31, 2019: <br />CreditSegmented <br />Fair Value Measurement Using <br />Quality/Time <br />Types of Investments <br />Ratings (1)Distribution (2)AmountLevel 1Level 2Level 3 <br />Pooled Investments <br />Broker Money MarketsN/Aless than 1 year$32,846$-$-$- <br />Non-pooled Investments <br />Negotiable certificates of depositsN/Aless than 1 year2,225,375-2,225,375- <br />Negotiable certificates of depositsN/A1 - 5 years1,534,552-1,534,552- <br />Total Non-pooled Investments3,759,927-3,759,927- <br />Total Investments$3,792,773$-$3,759,927$- <br />(1)Ratings were provided by various credit rating agencies where applicable to indicate associated credit risk. <br />(2)Interest rate risk is disclosed using the segmented time distribution method. <br />N/AIndicates not applicable. <br />A reconciliation of cash and temporary investments as shown in the financial statements for the Utilities follows: <br />2019 <br />Deposits$20,042,093 <br />Investments3,792,773 <br />Cash on Hand800 <br />Total$23,835,666 <br />Cash and Temporary Investments <br />Unrestricted$22,574,307 <br />Restricted1,261,359 <br />Total$23,835,666 <br />The investments of the Utilitiesare subject to the following risks: <br />Credit Risk.Is the risk that an issuer or other counterparty to an investment will not fulfill its obligations. Ratings <br />are provided by various credit rating agencies and where applicable, indicate associated credit risk.Minnesota <br />statutes and the Utilities’ investment policy limit the Utilities’ investments to the list on page 30of the notes. <br />Custodial Credit Risk. The custodial credit risk for investments is the risk that, in the event of the failure of the <br />counterparty to a transaction, a government will not be able to recover the value of investment or collateral <br />securities that are in the possession of an outside party. According to their investment policy the Utilities’ portfolio <br />maturities shall be staggered to avoid undue concentration of assets with one broker-dealer or financial institution. <br />35 <br />125 <br />