Date: July 15, 1997 Code: AD 97-08

To: Vice Presidents for Administration

From: George A. Pardon

Accounting Director

Business and Finance

Subject: Investment Manual for California State University Trust Funds

All Trust Fund (Fund 948) money, pending disbursement for its intended purpose, will be managed by Metropolitan West Securities, Inc. (MetWest) in custodial accounts in the name of the California State University System (or individual campuses). The process of making deposits to and withdrawals from the CSU System investment accounts is similar to using a LAIF Account. Funds will be wired in and out of a single campus bank account outside the State Treasury system. Campuses will have the options of placing their funds into a short-term account, an intermediate-term account, or both accounts. Campuses that are able to reasonably estimate their cash flow needs at least one month in advance will be able to benefit from the anticipated higher earnings of the Total Return Account.

The characteristics of the investment accounts are outlined below:

		SHORT-TERM ACCOUNT	TOTAL RETURN ACCOUNT
	Duration (approx.)	0.75 to 2 Years	3.75 to 5.75 Years
	Earnings Benchmark	Merrill Lynch 1 to 3 Year Index	Merrill Lynch Intermediate-Term Index
	Portfolio Valuation	Daily	End of the Month
	Deposits & Withdrawals	Daily	End of the Month

The enclosed Investment Manual contains the information and forms required to establish your sub-account, initiate transactions, and access your sub-account information via the internet at the MetWest website. Campuses will receive notification to make their first deposit from the Chancellor's Office shortly.

If you have any questions, please contact Mr. William Musselman at (562) 951-4610 or Mr. Jeff Silva of MetWest at (916) 441-6200.

Distribution: Mr. William P. Musselman

Mr. Jeff Silva - Metropolitan West Securities, Inc.

(Please contact your campus vice president for administration to obtain a copy of the campus-specific attachment.)