The Department has activities that have the authority to invest excess cash resources. A description of those activities, the investments made and a listing of the outstanding investments follow. Although funds in the Chancery Development Trust Account and the Bosnia Federation Defense Fund are invested, because they are considered non-entity assets the investments for these funds are not shown in this section, but are described in Note 8, "Cash and Other Monetary Assets."
Foreign Service Retirement and Disability Fund (FSRDF)
Treasury initially invests FSRDF receipts in special, non-marketable U.S. Government securities. These special-issue Certificates of Indebtedness mature on the following June 30. On June 30, the Treasury rolls over the Certificates of Indebtedness into special, non-marketable bonds, with maturities spread over 15 years and a yield equaling the average of all marketable Treasury securities. All securities are purchased and redeemed at par, regardless of market conditions. Interest is paid semi-annually on December 31 and June 30. Maturity dates on these securities range from 2004 through 2017, and interest rates range from 3.50% to 8.75%.
Israeli-Arab Scholarship and Eisenhower Exchange Fellowship Program Trust Funds
The Israeli-Arab Scholarship and Eisenhower Exchange Fellowship Program Trust Funds are invested in market-based securities, issued at either a premium or a discount, and are redeemable for par at maturity. The discounts and premiums on these investments are amortized over the life of the security using the effective interest method. Maturity dates on these securities range from 2004 to 2013; interest rates range from 3.25% to 7.875%.
Gift Funds
The Gift Funds invest in U.S. Government non-marketable, market-based securities, which are issued at either a premium or a discount, and are redeemable for par at maturity. The discounts and premiums on these investments are amortized over the life of the Treasury bill using the straight-line method. These securities matured in 2003; interest rates ranged from 1.48% to 1.55%.
Summary of Investments
Investments at September 30, 2003 and 2002, are summarized below (Dollars in Thousands). All investments are classified as Intragovernmental Securities.
| Par | Amortization Method |
Unamortized (Discount) |
Investments (Net) |
Market Value | |
|---|---|---|---|---|---|
|
Non-Marketable, Par Value: |
|||||
|
FSRDF Certificates of Indebtedness |
$ 2,576,177 | N/A | $ ? | $ 2,576,177 | $ 2,576,177 |
|
FSRDF Special Bonds |
9,713,125 |
N/A | ? |
9,713,125 |
9,713,125 |
|
Subtotal |
$12,289,302 |
$ ? |
$12,289,302 |
$12,289,302 | |
|
Non-Marketable, Market Based: |
|||||
|
Israeli-Arab Scholarship, Notes |
4,277 | Interest | 111 | 4,388 | 4,689 |
|
Eisenhower Exchange Fellowship, Notes |
7,534 | Interest | (51) | 7,483 | 8,172 |
|
Gift Funds, Bills |
? |
Straight-line | ? |
? |
? |
|
Subtotal |
$ 11,811 |
$ 60 |
$ 11,871 |
$ 12,861 | |
| Total Investments | $12,301,113 |
$ 60 |
$12,301,173 |
$12,302,163 |
| Par | Amortization Method |
Unamortized (Discount) |
Investments (Net) |
Market Value | |
|---|---|---|---|---|---|
|
Non-Marketable, Par Value: |
|||||
|
FSRDF Certificates of Indebtedness |
$ 1,306,221 | N/A | $ ? | $ 1,306,221 | $ 1,306,221 |
|
FSRDF Special Bonds |
10,428,019 |
N/A | ? |
10,428,019 |
10,428,019 |
|
Subtotal |
$11,734,240 |
$ ? |
$11,734,240 |
$11,734,240 | |
|
Non-Marketable, Market Based: |
|||||
|
Israeli-Arab Scholarship, Notes |
4,277 | Interest | 176 | 4,453 | 4,857 |
|
Eisenhower Exchange Fellowship, Notes |
7,395 | Interest | (42) | 7,353 | 8,086 |
|
Gift Funds, Bills |
4,721 |
Straight-line | (30) |
4,691 |
4,651 |
|
Subtotal |
$ 16,393 |
$104 |
$ 16,497 |
$ 17,594 | |
| Total Investments | $11,750,633 |
$104 |
$11,750,737 |
$11,751,834 |
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