(a)

1. (1) The goal of cash management is to protect the principal while maximizing investment income and minimizing non-interest-earning balances.
2. (2) Cash management considerations begin with the collection of funds and extend to the actual expenditure of those funds.
3. (3) Agencies should ensure that incoming funds are collected and deposited as soon as possible.
4. (4) Whenever possible, funds should be deposited in interest-earning accounts or invested in interest-earning investments.

5. (5) Interest income can:

   1. (A) Be used to fund an agency’s operating expenses; and
   2. (B) Reduce the necessity of increasing the fees levied on the public.
6. (6) An agency may use non-interest-earning accounts if they provide a greater rate of return.
7. (7) Agencies should utilize accounts and programs that maximize Federal Deposit Insurance Corporation deposit insurance coverage.
8. (8) A minimum of four (4) bids should be obtained from approved banks or financial institutions in order to obtain the highest interest rate possible.
9. (9) If an agency determines it is unable to obtain four (4) bids, the agency should provide a written explanation of that determination to the State Board of Finance or its designee.
10. (10) If the State Board of Finance rejects the determination, it can direct the agency to rebid.

(b)

1. (1) Fund expenditures should be regularly reviewed for noticeable spending patterns.
2. (2) Expenditures should generally be consolidated into as narrow a time span as possible.
3. (3) Whenever possible, expenditures should be made at the time existing investments mature or new incoming funds are deposited.
4. (4) The Treasurer of State and the Department of Finance and Administration can assist agencies with cash management, investment, and collateralization considerations.
5. (5) Each agency should develop a written plan for management of cash.