Victorian Consolidated Legislation

Trustee Companies Act 1984 - SECT 41

Cash common fund

41. Cash common fund



(1) The provisions of section 40 shall extend to the establishment of a common
fund which provides for the payment of interest determined from day to day but
if and only if the investment of that fund is restricted to the classes of
investment referred to in subsection (2).

(2) Subject to subsection (3), a trustee company may invest moneys in a common
fund of the kind referred to in subsection (1)-

   (a)  in any securities of the Commonwealth of Australia or of any State or
        Territory of the Commonwealth or of New Zealand;

   (b)  in any securities of a public statutory body constituted by or under a
        law of the Commonwealth or a State of the Commonwealth where the
        repayment of the principal secured and the interest payable thereon is
        guaranteed by the Commonwealth or the State;

   (c)  on loan guaranteed by the Treasurer or otherwise guaranteed by the
        Government of Victoria;

   (d)  on deposit-

   (i)  with an authorised deposit-taking institution; or

   (ii) subject to subsection (4), with an eligible money market dealer within
        the meaning of the Corporations Act;

   (e)  on term deposit with an authorised deposit-taking institution;



   (f)  in a bill of exchange which at the time of acquisition has a maturity
        date of not more than 200 days and which, if purchased for value,
        confers on the holder in due course a right of recourse against an
        authorised deposit-taking institution as the acceptor or indorser of
        the bill for an amount equal to the face value of the bill; or

   (g)  in a certificate of deposit issued by an authorised deposit-taking
        institution whether negotiable, convertible or otherwise.



(3) Where a maturity date for an investment is not specified in subsection
(2), the investment shall have a maturity date of not more than two years.

(4) A trustee company shall not deposit moneys with a corporation referred to
in subsection (2)(d)(ii) unless the deposit is secured by a mortgage, whether
by way of deposit or otherwise, of government securities of a market value at
the time of the deposit of not less than the amount of the deposit.