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B. The standard of care to be used by investment officials <br />shall be that of the "prudent person," which an overall <br />portfolio. •Investment officers acting in accordance with <br />written procedures and exercising due diligence shall be <br />relieved of personal responsibility for losses resulting <br />from an individual security, provided that deviations from <br />expectation are reported in a timely fashion and <br />appropriate action is taken to control adverse <br />developments. <br />C. Investments shall be made in accordance with the Public <br />Funds Investment Act of 1987 as recorded in Article <br />842a -2, Sections 1 -7 of Vernon's Civil Statutes. <br />D. Management responsibility for the investment process shall <br />rest with the City's Director of Finance. <br />E. The City's investments shall be reviewed annually by the <br />City's independent auditor as part of the annual audit <br />process. Any irregularities shall be reported directly to <br />the City Council through the audit report and /or verbally <br />through attendance at a regular or special City Council <br />meeting. <br />F. The City shall deposit its funds only in deposit accounts <br />that pare insured by the Federal' Deposit Insurance <br />Corporation or fully collaterized by securities which are <br />authorized by law to be used to collateralize the City's <br />deposits. <br />G. The City shall not purchase or sell any securities issued <br />or guaranteed by the Federal government from or to any <br />person (other than a depository institution. meeting the <br />requirements of "F" above) unless such person is a primary <br />dealer or is a securities dealer (1) which is registered <br />under the provisions of Section 15 of the Securities <br />Exchange Act of 1934 (2) which is registered as a <br />securities dealer under the Securities Act of the State of <br />Texas. <br />H. In all cases in which the City purchases securities, <br />including purchase under repurchase agreements, the City <br />must receive delivery of the securities prior to or at the <br />same time as it releases its funds for payment. In all <br />cases in which the City sells securities, including sales <br />under reverse repurchase agreements, the City must receive <br />payment in full for the securities prior to or at the same <br />time as it delivers the securities to the buyer. <br />I. In order to insure safety of principal, and to insure that <br />any Repurchase Agreement entered into by the City with any <br />Person will be characterized as a purchase and a <br />subsequent resale of a security by the City rather than as <br />21:01 -3 <br />4 <br />