VCOM Institutional Policy and Procedure Manual

VCOM Policy and Procedure

Policy #B003

1. PURPOSE The purpose of the investment policy is to outline an investment philosophy and attitude, which will guide the management of the investment of excess or liquid assets toward the desired results. The policy is intended to be sufficiently specific to be meaningful, yet flexible enough to be practical. This policy reflects the investment objectives and constraints by describing the following: a. Define and assign the responsibilities of all involved parties b. Establish a clear understanding for all involved parties of the investment goals and objectives c. Offer guidance and limitations to all Investment Managers regarding the investments d. Manage investments according to prudent standards as established in common trust law e. Establish the relevant time horizon for which investments will be managed. A budget should be established by the President and CFO predicting cash needs and operating expenses for the school for the subsequent 12 month period. The time horizons should be managed as follows: a. Short Term Reserves: Assets that are expected to be needed within the next 3 to 12 months for operating expenses b. Mid Term Reserves: Assets that are deemed as may be needed within the next 24 months for operating expenses c. Long Term Investments: Assets that are not expected to be needed until a minimum of 36 months and beyond The VCOM investment policy of is overseen by the investment committee with final approval by the Board of Directors. 2. PHILOSOPHY VCOM’s investment philosophy is to preserve principal while seeking a modest increase through appreciation and income. Market conditions will be assessed periodically to ascertain if investments or the mix of investments should be changed. Any change in investments will include an assessment of the increase or decrease of risks associated with the change. For example, the precipitous drop in the major stock market indices in late 2007 could have triggered a review of investments. Selling stocks and investing in safer instruments, such as certificates of deposits, Treasury bills and notes, to mitigate the risks of further declines in the value of equity or stock investments may have been an appropriate response. 3. OBJECTIVES The primary objective is the preservation of capital or principal. The second objective is to earn modest income on investment principal. The third objective is the growth of investments through appreciation. The emphasis of the investment strategy is total return; that is, the aggregate return from capital appreciation and dividend and interest income. 4. GENERAL PRINCIPLES a. Investments shall be made solely in the interest of VCOM b. Investments shall be made with care, skill, prudence and diligence under the circumstances then prevailing that a prudent man or woman acting in a like capacity and familiar with such matter would use with similar characteristics and aims

VCOM Investment Policy

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