CITY OF LAGUNA NIGUEL NOTES TO BASIC FINANCIAL STATEMENTS JUNE 30, 2024 NOTE 3 CASH AND INVESTMENTS (CONTINUED) The City’s cash and investments at June 30, 2024 in more detail: Cash and Cash Equivalents: Cash on Hand $ 2,400 Demand Deposits 3,176,692 Total Cash and Cash Equivalents 3,179,092 Investments: Federal Government Agency Securities 34,514,486 U.S. Treasury Obligations 17,934,360 Insured Certificates of Deposits 4,472,993 Money Market Mutual Fund 5,881,889 Orange County Investment Pool 78,121 PARS Pooled 115 Trust 2,179,843 State Local Agency Investment Fund 102,622 Total Investments 65,164,314 Total Cash and Investments $ 68,343,406 A. Demand Deposits The carrying amounts of the City’s deposits were $3,176,692 at June 30, 2024. Bank balances at that date were $4,165,534, the total amount of which was collateralized or insured with accounts held by the pledging financial institutions in the City’s name as discussed below. The California Government Code requires California banks and savings and loan associations to secure the City’s cash deposits by pledging securities as collateral. This Code states that collateral pledged in this manner shall have the effect of perfecting a security interest in such collateral superior to those of a general creditor. Thus, collateral for cash deposits is considered to be held in the City’s name. The market value of pledged securities must equal at least 110% of the City’s cash deposits. California law also allows institutions to secure City deposits by pledging first trust deed mortgage notes having a value of 150% of the City’s total cash deposits. The City may waive collateral requirements for cash deposits, which are fully insured up to $250,000 by the Federal Deposit Insurance Corporation. The City, however, has not waived the collateralization requirements. The City follows the practice of pooling cash and investments of all funds, except for funds deposited in escrow which were required by construction projects. Interest income earned on pooled cash and investments is allocated on an accounting period basis to the various funds based on the period-end cash and investment balances. (50)