UNIVERSITY OF CINCINNATI JUNE 30, 2008
GASB Statement 40 requires government entities to categorize investments of interest rate risk, credit risk, and
custodial risk.Interest Rate RiskThe Foundation’s investments total $15,651,000 and $19,511,000 as of June 30, 2008 and 2007 respectively.
The segmented time distribution method is used to portray interest rate risk for $14,818,000 and $17,515,000 of
bond and other fixed income investments as of June 30, 2008 and 2007, respectively. Investments for the
years ended June 30, 2008 and 2007 are summarized as follows (in thousands):Investment Maturities (In Years) 2008Investment Type Fair Value Less than 1 1 – 5 6 – 10 More than 10U.S. Treasury Obligations $ 2,023 $ 1,006 $ 446 $ 571 $ -
U.S. Government Agency
Obligations2,582 567 323 709 983
Municipal Obligations 60 - - 21 39
Corporate Bonds 4,280 1,830 1,569 869 12
Bond Mutual Funds 5,873 - 530 4,448 895
Total Investments $14,818 $ 3,403 $ 2,868 $ 6,618 $ 1,929Investment Maturities (In Years) 2007Investment Type Fair Value Less than 1 1 – 5 6 – 10 More than 10U.S. Treasury Obligations $ 1,270 $ 209 $ 219 $ 842 $ -
U.S. Government Agency
Obligations3,202 1,196 661 601 744
Municipal Obligations 77 - - 21 56
Corporate Bonds 5,498 2,453 2,350 663 32
Bond Mutual Funds 7,468 - 1,151 6,117 200
Total Investments $17,515 $ 3,858 $ 4,381 $ 8,244 $ 1,032The Foundation does not have a policy for interest rate risk.
Credit Risk – Bond and other fixed income investments are rated by nationally recognized rating organizations
as follows, as of June 30 (in thousands):2008 2007
U.S. Treasury Obligations $ 2,023 $ 1,270
AAA 6,577 8,397
AA/Aa 2,423 4,063
A/A-1 2,799 3,091
BBB/Baa 76 157
BB - 507
B 496 -
Not Rated 424 30
Total $14,818 $17,515Foundation investment grade bonds are limited to those in the first four grades of any rating system. The
average rating of the portfolio of investment grade bonds must be in the top two grades of any rating system.
Limited investments having strategic value to the University are permitted.