commissioners. Money market investments with an aggregate cost of $131,314,000 (which approximates
market) at June 30, 1987, are reported as cash and short-term investments. Other investments of the Fund,
which include U.S. Treasury notes, and corporate bonds and stocks, are stated at their market value of
$184,927,000 (amortized cost — $173,992,000) at June 30, 1987. Realized gains and losses from the sale of
investments are credited or charged to income. Changes in unrealized market appreciation or depreciation are
credited or charged to fund equity. Unrealized market appreciation or depreciation is reflected as a reservation
of fund equity.

The Pension Trust Fund, in accordance with Article 73 B, Section 161 of the Annotated Code of
Maryland, is permitted to make investments subject to the terms, conditions, limitations, and restrictions
imposed by the Board of Trustees of the Maryland State Retirement and Pension Systems. The law further
provides that not more than 15% of the assets that are invested in common stocks may be invested in non-
dividend paying common stocks. The pension trust fund's investments are commingled in two combined
investment funds. One investment fund consists principally of bonds and other fixed income investments
while the other investment fund consists principally of common stocks. Investments of the pension trust fund
are stated at cost, adjusted for amortization of premiums and accretion of discounts.

The investments at June 30, 1987 (amounts expressed in thousands) for the enterprise, nonexpendable
and pension trust funds are as follows:

C. Higher Education Fund:

The bank deposits of the Higher Education Fund (Fund) as of June 30, 1987 were entirely insured or
collateralized with securities held by the fund or its agent in the fund's name, with the exception of
approximately $955,000.

Investment funds established by higher education institutions relate principally to endowment and trust
accounts required by debt instruments. In general, endowment funds can be invested in debt and equity
securities and trust accounts can be invested only in debt securities. These investments include U.S. Treasury
and agency obligations, certificates of deposit, commercial paper, repurchase agreements, bankers
acceptances and money market funds.

Investments of the higher education institutions are stated at cost, adjusted for amortization of
premiums and accretion of discounts.

The investments at June 30, 1987 (amounts expressed in thousands) for the higher education fund are as
follows:

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