Finance Committee Meeting

ACPM

July 10, 2006

Attending:  Don Vickery, Halley Faust, Mike Barry, Kelly Andrewlevich

Guest:  Peter Kenny (Merrill Lynch) 

1.  Investment portfolio on reserves

Peter Kenny introduced himself and his team taking over for Al Kobren, who passed away suddenly.  By and large we are in line with our target equity and fixed income aspects of the investment account.  We are a bit large in our short fixed income, but it shouldn’t be adjusted until after the next Federal Reserve rate increase, which Peter feels will occur in August.  Also, our return is a bit under the market’s return (down 3.12% for the year vs. a weighted market return currently of down 2.4%); how we adjust to this will be forthcoming.  Peter mentioned that he will begin providing us with performance information compared with the market soon on a weighted index basis.

2.  Audit

The results of the audit were discussed, and the reasons for the larger-than-expected deficit were explained by management.  The audit was approved by the finance committee with recommendation it be sent to the executive committee.  A memo explaining the differences in the audit from the budget was briefly discussed – finance committee members will send their comments to Mike.

The meeting was adjourned.

Halley S. Faust, MD, MPH, MA

Secretary-Treasurer