Board of Investments, Department of Commerce, Financial Audit for the Fiscal Year Ended June 30 .. 2001

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There were no failures by any borrowers to return loaned securities or pay distributions thereon during fiscal years 2001 and 2000. Moreover, there were no losses during fiscal years 2001 and 2000 resulting from a default of the borrowers or State Street.
During fiscal years 2001 and 2000, the Board and the borrowers maintained the right to terminate all securities lending transactions on demand. The cash collateral received on each loan was invested, together with the cash collateral of other
...qualified plan lenders, in a collective investment pool, the Securities Lending Quality Trust. The relationship between the average maturities of the investment pool and the Board's loans was affected by the maturities of the loans made by other plan entities that invested cash collateral in the collective investment pool, which the Board could not determine. On June 30, 2001 and June 30, 2000, the Board had no credit risk exposure to borrowers.
As of June 30, 2001, there were no securities on loan.


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