PEER Report #4

A REPORT ON THE INVESTMENT OF EXCESS CASH BY THE STATE DEPOSITORY COMMISSION, August 3, 1973, 6 pages

This report was the final in a series of studies on the treatment of excess cash by certain state officials. Previous studies may be found in report number 2, page 73.

The investment of excess cash by the State Depository Commission in custody of the State Treasurer was the focus of the study. Commission records from FY 1973 showed that approximately $31 million was idle cash. If the maximum of 90 percent (ceiling set by statute) of this idle cash had been invested in certificates of deposit at 4 percent interest, additional revenue of $1,240,000 would have been earned.

Not only did the PEER Committee recommend investing these funds, but the Committee also recommended that the State Depository Commission close all checking accounts in state banks outside of Jackson. The commission should have reduced the balances of its accounts in the four Jackson banks and invested money on hand in these accounts on a short-term basis. In addition, legislation to reduce funds allowed to remain idle and revision of procedures for the use of demand and time deposits were recommended.

For a paper copy of this report, contact PEER by telephone at 601-359-1226 or by e-mail at reports@peer.ms.gov.