1. Regulatory Update: 2014 Money Fund Reform
Presentation to Iowa TMA
Regulatory Update: 2014 Money Fund Reform
Jim Gilligan, CTP, FP&A
Assistant Treasurer
Great Plains Energy Inc.
September 9, 2014
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

2. Overview of Changes Combination of reform Gov’t fund changes
Floating NAV
Gates and fees
Gov’t fund changes
Retail fund changes
Reporting changes
Time horizon
Tax changes
Treasury implications
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3. Floating NAV & Gates/Fees
Type of Fund
Net Asset Value (NAV)
Redemption Gates
Redemption Fees
Accounting Method
Institutional Prime
Floating
Yes
NAV
U.S. Treasury
Stable
Opt In
Amortized Cost
Government
Institutional Muni/Tax Exempt
Retail
Floating NAV is non discretionary
Gates and Fees are discretionary by the Board of the Fund
If weekly liquidity assets fall below 30% of the Fund’s total assets
Board can implement up to a 2% Fee
Suspend redemptions (lower a gate) for up to 10 business days
Only gate up to10 business days per 90 day period
Mandatory fee of 1% if weekly liquidity assets fall below 10% of total assets
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

4. Government Fund Changes
Re-defined as 99.5%* of total assets invested in:
Cash
Government securities
Repos collateralized by gov’t securities
Gates and Fees are:
At the discretion of the fund board with investor notification
Special reporting if NAV falls below $0.9975
__________________
* Was 80%
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

5. Retail Fund Changes Retail Investor Not related to asset size
Now defined as a natural person
Tied to Social Security Number
Not related to asset size
Share classes/structure could change
Special reporting if NAV falls below $0.9975
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

6. Reporting Changes
Floating NAV calculated to 1/100 of a penny ($0.0001) for Prime and Muni Funds
Fund disclosure if <10% weekly liquidity
Daily reporting of:
Daily and weekly liquid assets
Net shareholder flows
Market based NAV’s
Imposition of Fees and Gates
Sponsor support of the fund
New material event disclosure (on Form N-CR)
Disclosure of Sponsor support for prior 10 yrs
Form PF- private liquidity funding to report same as N-MFP
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

7. Reporting Changes Cont’d
5% issuer diversification limit requires affiliated entities to be treated as a single issuer
10% limit for guarantors of demand feature providers including Asset Backed Guarantors
15% for Muni funds
Enhanced stress testing
Removal of Credit Ratings reference re-proposed
Discretion of the board to determine appropriate securities
Tier I/Tier II restriction removed
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

8. All Other (Divers, PF, N-MFP, etc.)
Time Horizon
Fund
Floating NAV
Gates/Fees
N-CR
All Other (Divers, PF, N-MFP, etc.)
Prime
2 years
9 months
18 months
Gov’t/Treas
n/a
(if opt in)
Muni
Retail
Clock starts when rules are published in Federal Register
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

9. Tax Changes NAV Method vs. Amortized Cost For More Information:
Aggregated reporting of sales
Realized gain/loss is “short term”
Not subject to “Wash Sale” Rules
For More Information:
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

10. Treasury Implications
Investment policy considerations
Board approval and education
Floating NAV
Gates/Fees
Accounting considerations
Revised fund due diligence
Discussions with your fund manager
Discussion with your fund sponsor/bank
Credit rating’s reform
How tax reporting will be delivered
Bank product shift- more into CDs,TD’s?
Rise of non 2a-7 products
Basel III timing and reform timing
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

11. Treasury Implications Cont’d
More discretion given to the fund board
Offshore cash not subject to Money Fund Reform…. YET
More than just money funds impacted- Money fund like products
Consider other areas: DB, DC, Securities Lending, etc.
Muni based investors need gov’t backing; limited options
CP Issuers affected; dealer placed; alternate sources of funding
Portal provider reporting changes - timing
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

12. (Percent of Organizations Currently Investing in Prime MMFs)
Action Will Occur
(Percent of Organizations Currently Investing in Prime MMFs)
Source: The AFP Liquidity Survey, Association for Financial Professionals
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

13. Short-Term Investment Objective
Most Important Short-Term Investment Objective,
(Percent of Respondents)
Source: The AFP Liquidity Survey, Association for Financial Professionals
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

14. Change in Allocation of Investments
Allocation of Short-Term Investments,
(Mean Percent Distribution)
Source: The AFP Liquidity Survey, Association for Financial Professionals
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

15. Money Fund Selection Could Change
Source: The AFP Liquidity Survey, Association for Financial Professionals
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.

16. For More Information SEC Information: Treasury/IRS Information:
Tom Hunt, CTP
Director of Treasury Services
Association for Financial Professionals
SEC Information:
Treasury/IRS Information:
AFP, Association for Financial Professionals and the AFP logo are registered trademarks of the Association for Financial Professionals.