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<br />~ 2256.005
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<br />GOVERt~MENT CODE
<br />Title 10
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<br />(k) A wrinencopy of the investment policy shall be presented to any person
<br />offering to engage in an investment transaction with an investing entity. For
<br />purposes of this subsection, a business organization includes investment pools.
<br />Nothing in this subsection relieves the investing entity of the responsibility for
<br />monitoring the investments made by the investing entity to detennine that they
<br />are in compliance with the investment policy. The qualified representative of
<br />the business or~anization offering to engage in an invesunent transaction with
<br />w _ _ w
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<br />an investing entity shall execute a written instrument in a form acceptable to
<br />the investing entity and the business organization substantially to the effect that
<br />the business organization has:
<br />...
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<br />(1) received and reviewed the investment policy of the, entity; and
<br />(2) acknowledged that the business organization has implemented reason-
<br />... .. .
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<br />able procedures and controls in an effon to preclude investment transactions
<br />conducted between the entity and the organization that are not authorized by
<br />the entity's investment policy, except to the extent that this authorization is
<br />dependent on an analysis of the makeup of the entity's entire portfolio or
<br />requires an interpretation of subjective inv'estment standards.
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<br />(l) The investment officer of an entitY may not acquire or othe:v.ise obtain
<br />any authorized investment described in the investment policy of the investing
<br />entity from a person who has not delivered to the entity the h'1strume!lt required
<br />by Subsection (k).
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<br />(m) An investing entity, in conjunction with its annual financial audit, shall
<br />perform a compliance audit of management controls on investments and
<br />adherence to the entity's established investment policies. State agencies shall
<br />report the results of the audit performed under this, subsection to the state
<br />auditor. The state auditor shall compile the results of reports received uncle:: '
<br />this subsection and annually repon those results to the legislative audit commit-
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<br />tee.
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<br />Amended by Acts 1995, 74th Leg., ch. 402, S 1, eff. Sept. 1, 1995; Acts 1997, 75r.h Leg.,
<br />ch, 685, 9 1. eff. Sept 1. 1997; Acts 1997, 75th Leg., eh. 1421. 9 3, eff. Sept 1, 1997.
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<br />ActS 1997, 75th Leg.. ch. 685, rewrote subsec.
<br />(h), which previously read:
<br />"An officer or employee of a commission ere.
<br />ated under Chapter 391. LoC3l Government
<br />Code. is ineligible to be designated as an invesi.
<br />mem officer under Subsection m ."
<br />Acts 1997, 75th Leg., en. 1421. in subsee. (b),
<br />in subd. (4), in par. (C), substiruted "dollar-
<br />we:!!nted ave~e" for "ave:alZe dollar-weilZht-
<br />cd"~ added p~, (D) and (E),-and made other
<br />nonsubsumive changes: in sub~ec. (d), insened
<br />"or gToup of funds"; in subsec. (e), insened
<br />''The I!overnine bodv shall adoDt a wrinen in.
<br />strum~m bv rule, o~der, ordin~nce, or resolu.
<br />tion staring- that it has reviewed the invesiJIlem
<br />polic)' and invesonem strategies and that the
<br />wrinen instrument so adopted shall record any
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<br />Historical and Statutory Notes
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<br />changes made to either the investmem policy or
<br />investment Stratecies."; in subsec. (f), deleted ".
<br />Unless otherwisewauthorized by law, a person
<br />may not deposit, withdraw, invest. transfer, or
<br />mana2e in an\' other manner funds of a state
<br />agen~', local 'government. or invesnnem pool
<br />without exoress wrinen authoritv of the ~OVe:-.1.
<br />in'! bodv, ~hief executive officer~ or chief finan-
<br />c:31 officer of the state agency, local govern-
<br />mem, or investment pool. ", dele~ed "deposit.
<br />withdraw,", deleted ", transfer. or manage",
<br />and inserted "In the administration of the
<br />duties of an investment officer. the person des-
<br />ilmated as investment officer shall exercise the
<br />j~dgment and care, under prevailing circum-
<br />stances. that a prude:n person would exercise in
<br />the manageme:1t of-0e pe:-son's own aff:1iI'S.
<br />Unless authorized oy law, a pe:son ID2Y not
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