Marvin Mandel, Governor                         541

SOCIATIONS LOCATED IN THE STATE OF MARYLAND
HAVING A TOTAL PAID-IN CAPITAL OF AT LEAST ONE
MILLION DOLLARS ($1,000,000). THE TRUST DEPARTMENT
OF ANY SUCH STATE OR NATIONAL BANK OR SAVINGS
AND LOAN ASSOCIATIONS MAY BE DESIGNATED AS A
DEPOSITARY TO RECEIVE ANY SECURITIES ACQUIRED
OR OWNED BY THE SERVICE. THE RESTRICTION WITH
RESPECT TO PAID-IN CAPITAL MAY BE WAIVED FOR ANY
SUCH BANK OR SAVINGS AND LOAN ASSOCIATIONS WHICH
AGREES TO PLEDGE SECURITIES OF THE STATE OF MARY-
LAND OR OF THE UNITED STATES TO PROTECT THE
FUNDS AND SECURITIES OF THE SERVICE IN SUCH
AMOUNTS AND PURSUANT TO SUCH ARRANGEMENTS AS
MAY BE ACCEPTABLE TO THE SERVICE.

(B)  ANY MONIES OF THE SERVICE MAY, IN ITS DISCRE-
TION AND UNLESS OTHERWISE PROVIDED IN ANY AGREE-
MENT OR COVENANT BETWEEN THE SERVICE AND THE
HOLDERS OF ANY OF ITS OBLIGATIONS LIMITING OR RE-
STRICTING CLASSES OF INVESTMENTS, BE INVESTED IN
BONDS OR OTHER OBLIGATIONS OF, OR GUARANTEED AS
TO PRINCIPAL AND INTEREST BY, THE UNITED STATES OR
THE STATE OF MARYLAND OR THE POLITICAL SUBDIVI-
SIONS OR AGENCIES THEREOF.

(C)   THE SERVICE SHALL MAKE PROVISION FOR A SYS-
TEM OF FINANCIAL ACCOUNTING AND CONTROLS, AUDITS
AND REPORTS. ALL ACCOUNTING SYSTEMS AND RECORDS,
AUDITING PROCEDURES AND STANDARDS, AND FINAN-
CIAL REPORTING SHALL CONFORM TO GENERALLY AC-
CEPTED PRINCIPLES OF GOVERNMENTAL ACCOUNTING.
THE SERVICE SHALL ADOPT A FISCAL YEAR WHICH
SHALL BE JULY 1 TO JUNE 30, AND DESIGNATE THE NEC-
ESSARY FUNDS FOR COMPLETE ACCOUNTABILITY AND
SPECIFY THE BASIS OF ACCOUNTING FOR EACH SUCH
FUND.

(D)  AS SOON AS PRACTICAL AFTER THE CLOSING OF
THE FISCAL YEAR, AN AUDIT SHALL BE MADE OF THE
FINANCIAL BOOKS, RECORDS, AND ACCOUNTS OF THE
SERVICE. THE AUDIT SHALL BE MADE BY INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS, LICENSED TO PRAC-
TICE IN THIS STATE AS AUDITORS, SELECTED BY THE
SERVICE. SUCH AUDITORS SHALL HAVE NO PERSONAL
INTEREST DIRECTLY OR INDIRECTLY IN THE FISCAL
AFFAIRS OF THE SERVICE AND SHALL BE EXPERIENCED
AND QUALIFIED IN THE ACCOUNTING AND AUDITING OF
PUBLIC BODIES. THE REPORT OF AUDIT SHALL BE PRE-
PARED IN ACCORDANCE WITH GENERALLY ACCEPTED
AUDITING PRINCIPLES AND SHALL POINT OUT ANY IR-
REGULARITIES FOUND TO EXIST AND REPORT THE RE-
SULTS OF THEIR EXAMINATION, INCLUDING THEIR UN-
QUALIFIED OPINION ON THE PRESENTATION OF THE
FINANCIAL POSITION OF THE VARIOUS FUNDS AND THE
RESULTS OF THE SERVICE'S FINANCIAL OPERATIONS. IF
SUCH AUDITORS ARE UNABLE TO EXPRESS AN UNQUALI-
FIED OPINION THEY SHALL SO STATE AND SHALL FUR-
THER DETAIL REASONS FOR THEIR QUALIFICATIONS OR