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HomeMy WebLinkAbout2015-10-29 - Agendas - Final Firemen's Pension and Relief Fund October 29,2015 Page 1 of 81 Lioneld Jordan Chairman Pete Reagan Position 2 Retired Sondra E.Smith Secretary Dennis Mullens Position 3 Retired Roy Cate Position 1 Retired " Ron Wood Position 4 Retired Firemen's Pension and Relief Fund Board of Trustees Meeting Agenda October 29, 2015 A meeting of the Fayetteville Firemen's Pension and Relief Fund Board of Trustees will be held at 3:00 p.m. on October 29, 2015 in Room 326 of the City Administration Building. Call to Order Roll Call Garrison Financial: • 3rd Quarter Reports Approval of the Minutes: • Approval of the August 6, 2015 Meeting Minutes • Approval of the September 30, 2015 Special Meeting Minutes Pension List Changes: • None Approval of the Pension List: • Approval of the November and December 2015 and January 2016 Pension Lists Unfinished Business: • None New Business: • Revenue and Expense Report 09/30/15 • City Attorney Memo's to City Council regarding transferring the Firemen's Pension fund to LOPFI. • Ordinance 1136 • NCPERS Letter dated July 2015 Informational: 0 2016 Meeting Schedule Fayetteville Fireman's Pension and Relief Fund Meeting Date ��:1 1)kJ, � �� /� Adjourn Time ARCH 1VED Attendees: Subject: Subject: ' Aletl, �G./ do 15 R- ian oC�'st Motion By: Motion B n . Seconded: Seconded: Roy Cate .::2t/ Roy Cate ►� Mayor Jordan Mayor Jordan Dennis Mullens Dennis Mullens t/ Pete Reagan Pete Reagan p/ Sondra Smith `� j Sondra Smith l� *'Ronnie Wood Ronnie Wood Subject: 6, a 0 S Subject: J-Pt , 3p1 02O/S A Motion B : T �� Motion B Seconded: ,&t Seconded: Roy Cate +•� Roy Cate Mayor Jordan Mayor Jordan Dennis Mullens Dennis Mullens d/ Pete Reagan v' Pete Reagan t/ Sondra Smith v Sondra Smith Ronnie Wood Ronnie Wood �/ Firemen's Pension and Relief Fund October 29,2015 Page 2 of 81 c Firemen's Pension and Relief Fund October 29,2015 GArMRISON RECEIVPaqe ED of 81 F I N A N C I A L OCT 132015 0TY OF October 6, 2015 CITY CLERK'S oFFiCE� Ms. Sondra Smith City of Fayetteville 113 West Mountain Street Fayetteville, Arkansas 72701 Dear Ms.Smith, Enclosed are the quarterly reports for both Firemen's Pension & Relief Fund and Police Pension and Relief Fund for the quarter ended September 30, 2015. Uncertainty about Fed policy, woes in China, and sliding commodity prices weighed heavily on the equity markets in the third quarter, bringing about the long awaited correction that had eluded stocks for almost 4 years. Global growth concerns took center stage as China's economy continues to slow. The Chinese government took the markets by surprise in August devaluing the yuan in an effort to prop up the sliding stock market and aid the slumping manufacturing sector. In spite of the currency move, in addition to other measures like outright purchases of securities and halting trading,the Shanghai Composite still lost more than 25% during the quarter. The Fed also added to the uncertainty in the quarter, as the prospect of rising rates weighed on investors' minds. The U.S. economy remains steady, with good data one week and bad the next, but the Fed decided to keep rates unchanged in September. Rather than the equity markets cheering low rates, they sold off sharply after the Fed's decision, shining an even bigger spotlight on China and global growth concerns. Commodities took the worst hit as China has accounted for the much of the demand now for several years. Unsurprisingly, energy and the materials sector were yet again the worst performers in the quarter with energy down-18%and materials off-17%. Healthcare,which has been one of the bright spots in the market the past few years,was also down-11%during the quarter. The only positive sector in the quarter was the interest rate sensitive Utilities which gained+4.4%after retreating earlier in the year. The fixed income market for the quarter(as measured by the Barclays Intermediate Government/Credit Index)was up+.95%, bringing year-to-date performance to +1.77%and trailing twelve month performance to +2.68%. Yields (as measured by the market proxy of the 10 year Treasury Bond)for the quarter were down (prices up) from around 2.35%to 2.04%, having peaked in early July at 2.46% and troughed at an even 2.00% in mid-August. Year-to-date rates are down about.15%. For the year ended September, rates are down .45%. Garrison Financial 605 W. Dickson Street, Suite 201 •Fayetteville, Arkansas 72701 479-587-1045 • 888-442-7637. 479-587-1257 Facsimile•www.GarrisonFinancial.com Firemen's Pension and Relief Fund y October 29,2015 Page 4 of 81 Volatility spiked in the quarter as the markets grappled with global slowing. The equity markets finally registered a 10%correction and earnings are expected to head south due in large part to the turmoil in the commodities complex and the strong dollar. Although we do not believe a global recession is in the offing at this juncture, we do believe those headwinds, in addition to other economic concerns around the globe, will keep economic growth muted and interest rates low for the near term. We continue to focus our investments in strong companies we believe will deliver over the long-term and can withstand the ebbs and flows of the economic backdrop around the world. We've included a recent article written by James Bell for the Arkansas Business Journal regarding stock market corrections. We thought it might be of interest given the recent movements in the market. Please call the office if you should have any questions. Cordially, Kerry Bradley, CFA, MBA Equity Portfolio Manager Garrison Financial 605 W.Dickson Street, Suite 201 •Fayetteville,Arkansas 72701 479-587-1045 • 888-442-7637. 479-587-1257 Facsimile• www.GarrisonFinancial.com ' Firemen's Pension and Relief Fund October 29,2015 Page 5 of 81 r Are Investors Haunted by Corrections Past? It finally happened. After nearly four years,stocks suffered a correction in late August. Sure, it hurts to lose money,just like it always does. But I'm a numbers guy, so I find it helpful to review the historical record for the frequency and severity of such events, and more importantly, what to expect on the other side. From its all-time high on May 21 to its recent low on August 25,the S&P 500 declined 12.35%against a backdrop of China's currency devaluation, emerging markets weakness, and the potential for the Federal Reserve to finally raise short term rates from essentially zero. A lot of headlines were written about stocks officially entering correction territory. A correction is generally defined as a selloff of 10% or more,while declines of 20% or greater are termed bear markets. For simplicity, I will refer to any decline of 10%or greater as a correction. A review of market history from Yardeni Research shows 32 prior declines of 10%or more since 1945, ranging from those that barely qualify to the oil shock of the early 1970s (-48%), the tech bubble bursting in 2000(-49%), and we all remember the financial crisis around 2008 (-56%). Obviously not every correction leads to such ominous outcomes. On average, in the postwar period we have seen a correction just over every two years. There is no discernible pattern to timing or frequency, with eight corrections in the 1970s versus just two in the 1990s. The average percentage decline is-21%, though individual instances are highly variable. From peak to trough,the duration of corrections is also highly variable. Average duration is 231 days,with some instances as quick as a few weeks and others longer than a year including the two-and-a-half year tech correction that ended in October 2002. So given that corrections happen fairly regularly, and are by definition severe,why does the recent selloff feel so jarring? In part, I think investors may have been spoiled by the recent market. As noted, it has been nearly four years since the previous correction, longer than the two year average. Even that correction, beginning around August 2011 with the backdrop of S&P downgrading US Treasury debt from AAA, was mainly contained to a brief two months and quickly put in the rear view mirror. 2014 concluded as the sixth consecutive calendar year of positive returns (including dividends). It's easy to see how the potential for a correction may have been shuttled to the back of the mind. Other investors, with the memories of the severe bear markets of 2000 and 2008 still fresh, are quick to conclude that any selloff may be the harbinger of something far worse. Having invested through those years myself, that concern is understandable. Part of a financial advisor's job is education. Any discussion about the long-term positive average returns of stocks, bonds, real estate, or any asset class, should include the fact that those returns don't arrive smoothly,year in and year out. History demonstrates the certainty of unpredictable periods of decline with indeterminate length and severity. Academic research, and our own experience, have convinced me that there is no reliable way of predicting and avoiding these corrections, at least without substantially altering your risk profile. Note that avoiding corrections requires two accurate calls: identifying the peak to sell,then the bottom to reinvest, plus the drag of friction,transaction costs, and Firemen's Pension and Relief Fund October 29,2015 Page 6 of 81 w taxes. I know there are dozens of ways to make money in the markets, but I would be skeptical of anyone who claims to reliably avoid corrections. What does a stock market correction mean for the broader economy? Since stock prices reflect investors' opinions about earnings and growth,the economy, interest rates, and enthusiasm,declining prices necessarily signal a net decline in at least some of those factors,although it is very difficult to attribute which ones. S&P points out that all 11 postwar recessions were preceded by a correction, anticipated by an average of seven months. Unfortunately, corrections also produced a lot of false positives for recessions, providing an accurate forecast only 35%of the time. A correction is more of a yellow light, encouraging us to pay closer attention to our economic assumptions. Most corrections pass without a sustained contraction in economic growth. Bear markets have been more reliable recession predictors(67%). For an investor, the key is to acknowledge the likelihood of correction periods, then focus on the long term. Corrections come with the territory of equity investments, and the volatility they represent are part of the price of the higher long-term returns that stocks have historically provided. The discipline to stay invested through the downturns is often the sign of a successful investor. Keep in mind,stocks have recovered and then exceeded every prior correction, and I would not expect the current situation to end any differently. James Bell is a VP and financial advisor at Garrison Financial, a locally owned independent investment advisory firm. He can be reached at ibell@garrisonfinancial.com. Firemen's Pension and Relief Fund October 29,2015 Page 7 of 81 0001, GD D ISON A1\1\. F I N A N C I A L City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 Quarter Ending September 30, 2015 Firemen's Pension and Relief Fund October 29,2015 Page 8 of 81 PORTFOLIO SUMMARY City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 September 30, 2015 4.9% Cash & Equivalents 298,453.13 ■Account Fixed Income 2,279,635.06 11 Account Equities 3,524,576.12 Firemen's Pension and Relief Fund October 29,2015 Page 9 of 81 Garrison Financial PORTFOLIO APPRAISAL City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 September 30, 2015 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield CASH AND EQUIVALENTS Schwab.Advisor Cash Res- 298,453.13 298,453.13 4.9 0.010 29.85 0.0 Premier 298,453.13 298,453.13 4.9 29.85 0.0 TREASURY NOTE 700,000 US Treasury Note 101.33 709,287.07 108.89 762,216.00 12.5 4.000 28,000.00 0.9 4.000%Due 08-15-18 Accrued Interest 3,500.00 0.1 709,287.07 765,716.00 12.5 28,000.00 0.9 AGENCY BONDS 200,000 Federal Farm Credit 100.00 199,998.39 101.45 202,898.00 3.3 6.125 12,250.00 0.3 Bank 6.125%Due 12-29-15 Accrued Interest 3,096.53 0.1 199,998.39 205,994.53 3.4 12,250.00 0.3 CORPORATE BONDS 125,000 Verizon 99.95 124,939.50 99.86 124,824.87 2.0 1.350 1,687.50 1.4 Communications 1.350%Due 06-09-17 125,000 Lab Corp.of America 100.94 126,171.41 101.11 126,387.87 2.1 2.500 3,125.00 2.1 2.500%Due 11-01-18 125,000 Kroger Company 100.18 125,229.73 100.57 125,714.12 2.1 2.300 2,875.00 2.1 2.300%Due 01-15-19 125,000 Honeywell International 110.45 138,060.80 111.04 138,796.62 2.3 5.000 6,250.00 1.6 5.000%Due 02-15-19 125,000 Union Pacific Corp. 101.41 126,764.76 101.55 126,943.00 2.1 2.250 2,812.50 1.8 2.250%Due 02-15-19 125,000 J B Hunt Transportation 101.58 126,980.65 100.81 126,016.37 2.1 2.400 3,000.00 2.2 Svcs. 2.400%Due 03-15-19 125,000 Wait Disney Co. 99.91 124,885.09 100.64 125,798.87 2.1 1.850 2,312.50 1.7 1.850%Due 05-30-19 125,000 Berkshire Hathaway 105.44 131,798.95 103.84 129,794.87 2.1 2.900 3,625.00 2.1 Financial 2.900%Due 10-15-20 125,000 AT&T,Inc. 100.45 125,556.36 98.14 122,676.37 2.0 3.000 3,750.00 3.4 3.000%Due 02-13-22 Accrued Interest 6,571.53 0.1 1,150,387.26 1,153,524.53 18.9 29,437.50 2.0 CONVERTIBLE PREFERRED 300 Bunge 4.875%Conv. 108.63 32,588.95 98.13 29,439.00 0.5 4.875 1,462.50 5.0 Pfd. 32,588.95 29,439.00 0.5 1,462.50 5.0 COMMON STOCK 300 3M Corp. 164.93 49,479.55 141.77 42,531.00 0.7 4.100 1,230.00 2.9 2,000 AT&T,Inc. 28.24 56,475.88 32.58 65,160.00 1.1 1.880 3,760.00 5.8 905 AbbVie,Inc. 66.58 60,253.90 54.41 49,241.05 0.8 2.040 1,846.20 3.7 1,965 Abbott Laboratories 40.06 78,727.14 40.22 79,032.30 1.3 0.960 1,886.40 2.4 550 Accenture Plc. 90.81 49,943.51 98.26 54,043.00 0.9 2.200 1,210.00 2.2 440 Airgas,Inc. 112.76 49,614.11 89.33 39,305.20 0.6 2.400 1,056.00 2.7 120 Alliance Data Systems 283.98 34,077.36 258.98 31,077.60 0.5 0.000 0.00 0.0 1 Firemen's Pension and Relief Fund October 29,2015 Page 10 of 81 Garrison Financial PORTFOLIO APPRAISAL City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 September 30, 2015 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield 625 Amgen,Inc. 114.33 71,456.06 138.32 86,450.00 1.4 3.160 1,975.00 2.3 825 Anadarko Petroleum 85.82 70,805.10 60.39 49,821.75 0.8 1.080 891.00 1.8 500 Ansys,Inc. 75.67 37,836.95 88.14 44,070.00 0.7 0.000 0.00 0.0 1,680 Apple Computer 72.69 122,121.54 110.30 185,304.00 3.0 2.080 3,494.40 1.9 785 AptarGroup,Inc. 63.47 49,825.05 65.96 51,778.60 0.8 1.120 879.20 1.7 125 AutoZone,Inc. 516.09 64,511.70 723.83 90,478.75 1.5 0.000 0.00 0.0 1,350 BCE,Inc.CI F 24.40 32,934.20 40.96 55,296.00 0.9 2.630 3,550.50 6.4 350 Becton,Dickinson& 113.97 39,889.45 132.66 46,431.00 0.8 2.400 840.00 1.8 Company 1,500 Broadridge Financial 41.33 62,000.35 55.35 83,025.00 1.4 1.200 1,800.00 2.2 Solutions 675 Brown-Forman Corp. 88.81 59,946.93 96.90 65,407.50 1.1 1.260 850.50 1.3 665 CH Robinson 74.84 49,768.25 67.78 45,073.70 0.7 1.520 1,010.80 2.2 Worldwide 3,000 CSX Corporation 28.88 86,627.40 26.90 80,700.00 1.3 0.720 2,160.00 2.7 1,300 Cal-Maine Foods,Inc. 36.68 47,687.88 54.61 70,993.00 1.2 1.010 1,313.00 1.8 585 Check Point Software 85.44 49,979.59 79.33 46,408.05 0.8 0.000 0.00 0.0 400 Chevron Corporation 85.21 34,084.61 78.88 31,552.00 0.5 4.280 1,712.00 5.4 2,800 Cisco Systems,Inc. 19.70 55,168.69 26.25 73,500.00 1.2 0.840 2,352.00 3.2 1,400 Coca-Cola Company 30.98 43,374.60 40.12 56,168.00 0.9 1.320 1,848.00 3.3 680 Compass Minerals Int'I 87.89 59,765.06 78.37 53,291.60 0.9 2.640 1,795.20 3.4 1,150 ConocoPhillips 55.58 63,918.42 47.96 55,154.00 0.9 2.960 3,404.00 6.2 565 Deere&Co. 87.76 49,585.72 74.00 41,810.00 0.7 2.400 1,356.00 3.2 500 Disney,Walt Holdings 110.91 55,454.90 102.20 51,100.00 0.8 1.320 660.00 1.3 2,000 EMC Corp. 25.64 51,282.21 24.16 48,320.00 0.8 0.460 920.00 1.9 830 Eastman Chemical 86.14 71,495.64 64,72 53,717.60 0.9 1.600 1,328.00 2.5 1,310 Emerson Electric 68.00 89,080.00 44.17 57,862.70 0.9 1.880 2,462.80 4.3 3,825 General Electric Co. 19.53 74,709.32 25.22 96,466.50 1.6 0.920 3,519.00 3.6 1,200 GlaxoSmithKlinePlc. 50.10 60,124.15 38.45 46,140.00 0.8 2.290 2,748.00 6.0 2,250 Intel Corp. 20.53 46,202.71 30.14 67,815.00 1.1 0.960 2,160.00 3.2 800 Johnson&Johnson 64.70 51,756.60 93.35 74,680.00 1.2 3.000 2,400.00 3.2 465 Kimberly Clark Corp. 107.07 49,786.64 109.04 50,703.60 0.8 3.520 1,636.80 3.2 395 Laboratory Corp. 125.86 49,715.75 108.47 42,845.65 0.7 0.000 0.00 0.0 1,000 Lincoln Electric 67.21 67,209.18 52.43 52,430.00 0.9 1.160 1,160.00 2.2 640 Medtronic Plc. 77.60 49,662.77 66.94 42,841.60 0.7 1.520 972.80 2.3 1,100 Merck&Co.,Inc. 51.39 56,525.78 49.39 54,329.00 0.9 1.800 1,980.00 3.6 800 National Oilwell Varco 85.35 68,280.15 37.65 30,120.00 0.5 1.840 1,472.00 4.9 1,000 Patterson Companies 51.07 51,074.75 43.25 43,250.00 0.7 0.880 880.00 2.0 530 Pepsico,Inc. 93.75 49,690.09 94.30 49,979.00 0.8 2.810 1,489.30 3.0 830 Phillips 66 72.18 59,911.86 76.84 63,777.20 1.0 2.240 1,859.20 2.9 1,000 Procter&Gamble Co. 59.42 59,417.61 71.94 71,940.00 1.2 2.650 2,650.00 3.7 1,000 Qualcomm,Inc. 63.62 63,616.39 53.73 53,730.00 0.9 1.920 1,920.00 3.6 2,790 Raven Industries,Inc. 28.37 79,148.48 16.95 47,290.50 0.8 0.520 1,450.80 3.1 700 Sanofi ADR 55.71 38,995.10 47.47 33,229.00 0.5 1.320 924.00 2.8 770 Sensient Technologies 64.55 49,704.67 61.30 47,201.00 0.8 1.080 831.60 1.8 900 St.Jude Medical,Inc. 66.56 59,900.53 63.09 56,781.00 0.9 1.160 1,044.00 1.8 1,055 Syngenta AG ADR 71.44 75,370.40 63.78 67,287.90 1.1 1.970 2,078.35 3.1 850 Texas Instruments 58.53 49,754.69 49.52 42,092.00 0.7 1.520 1,292.00 3.1 465 Valmont Industries 128.60 59,797.26 94.89 44,123.85 0.7 1.500 697.50 1.6 450 Wabtec Corp. 93.64 42,137.64 88.05 39,622.50 0.6 0.320 144.00 0.4 1,150 Wal-Mart Stores,Inc. 62.11 71,423.42 64.84 74,566.00 1.2 1.960 2,254.00 3.0 2,000 Waste Management 42.21 84,414.32 49.81 99,620.00 1.6 1.540 3,080.00 3.1 3,265,502.02 3,276,964.70 53.7 88,234.35 2.7 MUTUAL FUNDS 2,248.991 Dodge&Cox Intl Stk 45.41 102,132.74 37.02 83,257.65 1.4 0.970 2,181.52 2.6 2 Firemen's Pension and Relief Fund October 29,2015 Page 11 of 81 Garrison Financial PORTFOLIO APPRAISAL City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 September 30, 2015 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield' 2,587.463 Oppenheimer 39,33 101,776.46 29.18 75,502.17 1.2 0.100 258.75 0.3 Developing Mkts A 203,909.20 158,759.82 2.6 2,440.27 1.5 UNIT TRUSTS 2,340 FT Energy Income& 34.20 80,032.95 25.39 59,412.60 1.0 2.220 5,194.80 8.7 Growth 4,000 iShares S&P US Pfd Stk 38.34 153,340.30 38.60 154,400.00 2.5 2.380 9,520.00 6.2 233,373.25 213,812.60 3.5 14,714.80 6.9 TOTAL PORTFOLIO 6,093,499.27 6,102,664.30 100.0 176,569.26 2.3 'ou should carefully compare this statement to the statement you receive from your custodian and notify us immediately of any discrepancies. 3 Firemen's Pension and Relief Fund October 29,2015 Page 12 of 81 Garrison Financial PURCHASE AND SALE City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 From 01-01-15 To 09-30-15 Trade Settle Unit Date Date Quantity Security Price Amount PURCHASES 03-19-15 03-24-15 300 3M Corp. 164.93 49,479.55 03-24-15 03-27-15 125,000 AT&T,Inc. 100.48 125,597.62 3.000%Due 02-13-22 03-19-15 03-24-15 550 Accenture Plc. 90.81 49,943.51 03-19-15 03-24-15 200 Airgas,Inc. 112.76 22,551.87 03-19-15 03-24-15 100 Airgas,Inc. 112.76 11,275.93 03-19-15 03-24-15 140 Airgas,Inc. 112.76 15,786.31 03-19-15 03-24-15 785 AptarGroup,Inc. 63.47 49,825.05 03-24-15 03-27-15 125,000 Berkshire Hathaway Financial 105.98 132,470.38 2.900%Due 10-15-20 03-19-15 03-24-15 200 CH Robinson Worldwide 74.85 14,970.69 03-19-15 03-24-15 100 CH Robinson Worldwide 74.83 7,483.35 03-19-15 03-24-15 365 CH Robinson Worldwide 74.83 27,314.21 03-10-15 03-13-15 1,300 Cal-Maine Foods,Inc. 36.68 47,687.88 03-19-15 03-24-15 585 Check Point Software 85.44 49,979.59 03-19-15 03-24-15 565 Deere&Co. 87.76 49,585.72 06-04-15 06-09-15 500 Disney,Walt Holdings 110.91 55,454.90 03-19-15 03-24-15 100 FT Energy Income&Growth 34.18 3,418.38 03-19-15 03-24-15 100 FT Energy Income&Growth 34.18 3,418.38 03-19-15 03-24-15 100 FT Energy Income&Growth 34.20 3,420.38 03-19-15 03-24-15 140 FT Energy Income&Growth 34.20 4,788.54 03-19-15 03-24-15 60 FT Energy Income&Growth 34.20 2,052.23 03-19-15 03-24-15 20 FT Energy Income&Growth 34.20 684.08 03-19-15 03-24-15 100 FT Energy Income&Growth 34.20 3,420.38 03-19-15 03-24-15 900 FT Energy Income&Growth 34.20 30,783.44 03-19-15 03-24-15 100 FT Energy Income&Growth 34.20 3,420.38 03-19-15 03-24-15 300 FT Energy Income&Growth 34.20 10,261.15 03-19-15 03-24-15 300 FT Energy Income&Growth 34.20 10,261.15 03-19-15 03-24-15 100 FT Energy Income&Growth 34.20 3,420.38 03-19-15 03-24-15 20 FT Energy Income&Growth 34.20 684.08 05-08-15 05-13-15 125,000 J B Hunt Transportation Svcs. 101.76 127,201.62 2.400%Due 03-15-19 03-19-15 03-24-15 100 Kimberly Clark Corp. 107.07 10,706.72 03-19-15 03-24-15 100 Kimberly Clark Corp. 107.07 10,706.82 03-19-15 03-24-15 65 Kimberly Clark Corp. 107.07 6,959.44 03-19-15 03-24-15 100 Kimberly Clark Corp. 107.07 10,706.82 03-19-15 03-24-15 100 Kimberly Clark Corp. 107.07 10,706.84 03-19-15 03-24-15 395 Laboratory Corp. 125.86 49,715.75 03-19-15 03-24-15 640 Medtronic Plc. 77.60 49,662.77 01-28-15 02-02-15 1,000 Patterson Companies 51.07 51,074.75 03-19-15 03-24-15 530 Pepsico,Inc. 93.75 49,690.09 03-19-15 03-24-15 770 Sensient Technologies 64.55 49,704.67 1 Firemen's Pension and Relief Fund October 29,2015 Page 13 of 81 Garrison Financial PURCHASE AND SALE City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 From 01-01-15 To 09-30-15 Trade Settle Unit Date Date Quantity Security Price Amount 03-19-15 03-24-15 850 Texas Instruments 58.53 49,754.69 03-12-15 03-17-15 450 Wabtec Corp. 93.64 42,137.64 1,308,168.13 SALES 03-19-15 03-24-15 2,000 Alerian MLP 16.34 32,676.02 03-19-15 03-24-15 3,000 Alerian MLP 16.34 49,014.03 05-07-15 05-12-15 200 Cisco Systems,Inc. 28.81 5,762.90 05-07-15 05-12-15 1,300 Cisco Systems,Inc. 28.81 37,458.85 03-19-15 03-24-15 100 Ensco Plc. 20.62 2,061.55 03-19-15 03-24-15 250 Ensco Plc. 20.62 5,153.88 03-19-15 03-24-15 300 Ensco Plc. 20.62 6,184.66 03-19-15 03-24-15 300 Ensco Plc. 20.62 6,184.66 03-19-15 03-24-15 800 Ensco Plc. 20.61 16,491.60 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 200 Freeport-McMoRan Copper&Gold, 17.20 3,440.04 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 100 Freeport-McMoRan Copper&Gold, 17.20 1,720.02 Inc. 03-19-15 03-24-15 1,100 Freeport-McMoRan Copper&Gold, 17.20 18,915.85 Inc. 05-07-15 05-12-15 250 Intel Corp. 32.32 8,080.37 05-07-15 05-12-15 750 Intel Corp. 32.32 24,241.09 05-07-15 05-12-15 450 Johnson&Johnson 99.86 44,938.97 03-19-15 03-24-15 5,650 Keycorp 14.41 81,406.62 05-08-15 05-13-15 635 McDonald's Corp. 98.51 62,554.99 04-08-15 04-13-15 150 Microsoft Corp. 41.35 6,201.93 04-08-15 04-13-15 2,675 Microsoft Corp. 41.35 110,601.00 03-19-15 03-24-15 1,750 Noble Corp. 13.53 23,685.79 04-08-15 04-13-15 50 Pfizer,Inc. 34.66 1,732.85 04-08-15 04-13-15 3,600 Pfizer,Inc. 34.66 124,765.24 03-19-15 03-24-15 2,000 Sector SPDR Fncl Select Shs 24.41 48,818.36 2 Firemen's Pension and Relief Fund October 29,2015 Page 14 of 81 Garrison Financial PURCHASE AND SALE City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 From 01-01-15 To 09-30-15 Trade Settle Unit Date Date Quantity Security Price Amount 03-19-15 03-24-15 1,775 Sector SPDR Fncl Select Shs 24.41 43,324.52 03-19-15 03-24-15 1,700 Sector SPDR Utility Select Shs 44.91 76,343.50 03-19-15 03-24-15 2,300 Sector SPDR Utility Select Shs 44.91 103,288.25 03-19-15 03-24-15 3,000 iShares DJ Select Div 78.45 235,336.72 03-24-15 03-27-15 800 iShares IBOXX Inv Grade Corp Bond 121.86 97,490.72 03-24-15 03-27-15 46 iShares IBOXX Inv Grade Corp Bond 121.86 5,605.72 03-24-15 03-27-15 1,204 iShares IBOXX Inv Grade Corp Bond 121.86 146,723.52 05-08-15 05-13-15 1,250 iShares IBOXX Inv Grade Corp Bond 119.06 148,825.94 1,589,350.28 3 Firemen's Pension and Relief Fund October 29,2015 Page 15 of 81 Garrison Financial REALIZED GAINS AND LOSSES City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 From 01-01-15 Through 09-30-15 Gain Or Loss Open Close Cost Amort.or Date Date Quantity Security Basis Accretion Proceeds Short Term Long Term 04-16-14 03-19-15 100 Ensco Plc. 5,034.33 2,061.55 -2,972.78 04-16-14 03-19-15 250 Ensco Plc. 12,585.82 5,153.88 -7,431.94 04-16-14 03-19-15 300 Ensco Plc. 15,102.98 6,184.66 -8,918.32 04-16-14 03-19-15 300 Ensco Plc. 15,102.98 6,184.66 -8,918.32 04-16-14 03-19-15 800 Ensco Plc. 40,274.61 16,491.60 -23,783.01 06-10-14 03-19-15 1,750 Noble Corp. 48,930.13 23,685.79 -25,244.34 06-26-14 03-19-15 2,000 Alerian MLP 36,190.60 32,676.02 -3,514.58 01-16-13 03-19-15 3,000 Alerian MLP 51,451.61 49,014.03 -2,437.58 12-20-10 03-19-15 1,700 Sector SPDR Utility Select 58,043.02 76,343.50 18,300.48 Shs 12-20-10 03-19-15 2,300 Sector SPDR Utility Select 78,528.80 103,288.25 24,759.45 Shs 05-19-14 03-19-15 5,650 Keycorp 75,839.95 81,406.62 5,566.67 02-10-14 03-19-15 2,000 Sector SPDR Fncl Select Shs 43,639.23 48,818.36 5,179.13 02-10-14 03-19-15 1,775 Sector SPDR Friel Select Shs 38,729.82 43,324.52 4,594.70 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 200 Freeport-McMoRan Copper 6,975.40 3,440.04 -3,535.36 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 100 Freeport-McMoRan Copper 3,487.70 1,720.02 -1,767.68 &Gold,Inc. 05-12-14 03-19-15 1,100 Freeport-McMoRan Copper 38,364.70 18,915.85 -19,448.85 &Gold,Inc. 08-08-11 03-19-15 3,000 ishares DJ Select Div 156,695.97 235,336.72 78,640.74 10-06-09 03-24-15 800 ishares IBOXX Inv Grade 87,773.42 97,490.72 9,717.30 Corp Bond 10-06-09 03-24-15 46 iSharesIBOXX Inv Grade 5,046.97 5,605.72 558.75 Corp Bond 10-06-09 03-24-15 1,204 ishares IBOXX Inv Grade 132,099.00 146,723.52 14,624.52 Corp Bond 06-26-14 04-08-15 150 Microsoft Corp. 6,271.50 6,201.93 -69.57 11-05-13 04-08-15 2,675 Microsoft Corp. 100,543.80 110,601.00 10,057.20 06-26-14 04-08-15 50 Pfizer,Inc. 10,088.00 1,732.85 -8,355.15 05-07-10 04-08-15 3,600 Pfizer,Inc. 72,441.75 124,765.24 52,323.49 06-26-14 05-07-15 250 Intel Corp. 7,037.50 8,080.37 1,042.87 06-22-06 05-07-15 750 Intel Corp. 15,400.90 24,241.09 8,840.18 06-26-14 05-07-15 200 Cisco Systems,Inc. 4,642.00 5,762.90 1,120.90 03-29-11 05-07-15 1,300 Cisco Systems,Inc. 25,614.04 37,458.85 11,844.81 04-15-11 05-07-15 450 Johnson&Johnson 29,113.09 44,938.97 15,825.88 10-06-09 05-08-15 1,250 iShares IBOXX Inv Grade 137,145.97 148,825.94 11,679.97 Corp Bond 1 Firemen's Pension and Relief Fund October 29,2015 Page 16 of 81 Garrison Financial REALIZED GAINS AND LOSSES City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 From 01-01-15 Through 09-30-15 Gain Or Loss Open Close Cost Amort.or Date Date Quantity Security Basis Accretion Proceeds Short Term Long Term 12-31-14 05-08-15 635 McDonald's Corp. 60,065.98 62,554.99 2,489.01 TOTAL GAINS 10,219.45 266,946.61 TOTAL LOSSES -124,565.97 -2,437.58 1,439,187.77 0.00 1,589,350.28 -114,346.52 264,509.03 TOTAL REALIZED GAIN/LOSS 150,162.51 NO CAPITAL GAINS DISTRIBUTIONS 2 Garrison Financial Firemen's Pension and Relief Fund 29,PERFORMANCE SUMMARY OctoberPage17 of 81 GROSS OF FEES City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 September 30, 2015 PORTFOLIO COMPOSITION CHANGE IN PORTFOLIO Market Pct. Value Assets Yield Cash&Equivalents 298,453.13 4.9 0.0 Portfolio Value on 12-31-14 7,023,870.27 Account Fixed 2,279,635.06 37.4 1.8 Accrued Interest 16,134.03 Income Account Equities 3,524,576.12 57.8 2.8 Net Additions/Withdrawals -577,065.04 Account 0.00 0.0 - Realized Gains -48,890.72 Commodities Unrealized Gains -442,049.03 Income Received 133,630.77 Change in Accrued Interest -2,965.97 Portfolio Value on 09-30-15 6,089,496.25 Accrued Interest 13,168.06 Total 6,102,664.30 100.0 2.3 6,102,664.30 TIME WEIGHTED RETURN Annualized Quarter Year Last 12 Inception To Date To Date Months To Date Account -4.98 -5.56 -4.11 -3.97 40%Fixed Income/60% -3.49 -2.38 0.85 1.22 Equity Blended Index Account Fixed Income 0.69 1.84 2.88 2.34 Barclays Capital Intermed 0.95 1.77 2.68 2.11 Govt/Credit Account Equities -8.68 -10.20 -8.45 -7.93 S&P 500 -6.44 -5.29 -0.61 0.40 All "Account" returns refer to your portfolio. Benchmark indexes are also listed for reference. All returns are reported as percentages. This report is calculated using industry-standard accounting and performance calculation methodologies and is generated by our Axys portfolio accounting software. Calculations are a time-weighted total return series based on monthly valuations, including all cash and equivalents. All calculations are done based on trade date, employing the accrual method of accounting and include cash, interest, dividends and realized and unrealized gains and losses. Performance is adjusted to accurately reflect portfolio deposits and withdrawals. Results are presented after transaction costs but before management fees. Inception-to-date returns are annualized numbers, except for accounts under management less than one year. Unsupervised assets are excluded in performance calculation. At any given point in time an investment may be worth more or less than the original purchase price. Firemen's Pension and Relief Fund 0001, October 29,2015 Page 18 of 81 GARRISON F I N A N C I A L October 7,2015 City of Fayetteville Police Pension and Relief Fund Charles Schwab #2448-5630 113 West Mountain Fayetteville,AR 72701 STATEMENT OF MANAGEMENT FEES For The Period July 1 through September 30,2015 Portfolio Value as of 06-30-15 6,519,258 Portfolio Value as of 07-31-15 6,462,506 Portfolio Value as of 08-31-15 6,203,646 Portfolio Value as of 09-30-15 6,102,664 Average of 4 Months 6,322,018 6,322,018 @ 0.5000%per annum 7,903 Quarterly Management Fee 7,903 TOTAL DUE AND PAYABLE 7,903 This statement is for informational purposes only. As you requested, the fee will be automatically deducted from your account. Please be advised that it is the responsibility of the client to verify the accuracy of each fee calculation. The custodian will not determine whether the fee is properly calculated. 001�i, GAkRISON RECEIVED FINANCIAL OCT 132015 October 6, 2015 CIINfY CLERK'S OFFS EE Ms. Sondra Smith City of Fayetteville 113 West Mountain Street Fayetteville, Arkansas 72701 Dear Ms. Smith, Enclosed are the quarterly reports for both Firemen's Pension & Relief Fund and Police Pension and Relief Fund for the quarter ended September 30, 2015. Uncertainty about Fed policy, woes in China, and sliding commodity prices weighed heavily on the equity markets in the third quarter, bringing about the long awaited correction that had eluded stocks for almost 4 years. Global growth concerns took center stage as China's economy continues to slow. The Chinese government took the markets by surprise in August devaluing the yuan in an effort to prop up the sliding stock market and aid the slumping manufacturing sector. In spite of the currency move, in addition to other measures like outright purchases of securities and halting trading, the Shanghai Composite still lost more than 25% during the quarter. The Fed also added to the uncertainty in the quarter, as the prospect of rising rates weighed on investors' minds. The U.S. economy remains steady, with good data one week and bad the next, but the Fed decided to keep rates unchanged in September. Rather than the equity markets cheering low rates, they sold off sharply after the Fed's decision, shining an even bigger spotlight on China and global growth concerns. Commodities took the worst hit as China has accounted for the much of the demand now for several years. Unsurprisingly, energy and the materials sector were yet again the worst performers in the quarter with energy down -18%and materials off-17%. Healthcare, which has been one of the bright spots in the market the past few years, was also down-11% during the quarter. The only positive sector in the quarter was the interest rate sensitive Utilities which gained+4.4% after retreating earlier in the year. The fixed income market for the quarter(as measured by the Barclays Intermediate Government/Credit Index)was up+.95%, bringing year-to-date performance to +1.77%and trailing twelve month performance to+2.68%. Yields (as measured by the market proxy of the 10 year Treasury Bond)for the quarter were down (prices up) from around 2.35%to 2.04%, having peaked in early July at 2.46% and troughed at an even 2.00% in mid-August. Year-to-date rates are down about .15%. For the year ended September, rates are down .45%. Garrison Financial 605 W. Dickson Street, Suite 201 *Fayetteville,Arkansas 72701 479-587-1045 • 888-442-7637. 479-587-1257 Facsimile 9 www.GarrisonFinancial.com Volatility spiked in the quarter as the markets grappled with global slowing. The equity markets finally registered a 10% correction and earnings are expected to head south due in large part to the turmoil in the commodities complex and the strong dollar. Although we do not believe a global recession is in the offing at this juncture, we do believe those headwinds, in addition to other economic concerns around the globe, will keep economic growth muted and interest rates low for the near term. We continue to focus our investments in strong companies we believe will deliver over the long-term and can withstand the ebbs and flows of the economic backdrop around the world. We've included a recent article written by James Bell for the Arkansas Business Journal regarding stock market corrections. We thought it might be of interest given the recent movements in the market. Please call the office if you should have any questions. Cordially, Kerry Bradley, CFA, MBA Equity Portfolio Manager Garrison Financial 605 W. Dickson Street, Suite 201 .Fayetteville, Arkansas 72701 479-587-1045 9 888-442-7637. 479-587-1257 Facsimile+ www.GarrisonFinancial.com Are Investors Haunted by Corrections Past? It finally happened. After nearly four years, stocks suffered a correction in late August. Sure, it hurts to lose money,just like it always does. But I'm a numbers guy, so I find it helpful to review the historical record for the frequency and severity of such events, and more importantly, what to expect on the other side. From its all-time high on May 21 to its recent low on August 25,the S&P 500 declined 12.35% against a backdrop of China's currency devaluation, emerging markets weakness, and the potential for the Federal Reserve to finally raise short term rates from essentially zero. A lot of headlines were written about stocks officially entering correction territory. A correction is generally defined as a selloff of 10% or more, while declines of 20% or greater are termed bear markets. For simplicity, I will refer to any decline of 10%or greater as a correction. A review of market history from Yardeni Research shows 32 prior declines of 10%or more since 1945, ranging from those that barely qualify to the oil shock of the early 1970s (-48%), the tech bubble bursting in 2000 (-49%), and we all remember the financial crisis around 2008 (-56%). Obviously not every correction leads to such ominous outcomes. On average, in the postwar period we have seen a correction just over every two years. There is no discernible pattern to timing or frequency, with eight corrections in the 1970s versus just two in the 1990s. The average percentage decline is-21%, though individual instances are highly variable. From peak to trough, the duration of corrections is also highly variable. Average duration is 231 days,with some instances as quick as a few weeks and others longer than a year including the two-and-a-half year tech correction that ended in October 2002. So given that corrections happen fairly regularly, and are by definition severe, why does the recent selloff feel so jarring? In part, I think investors may have been spoiled by the recent market. As noted, it has been nearly four years since the previous correction, longer than the two year average. Even that correction, beginning around August 2011 with the backdrop of S&P downgrading US Treasury debt from AAA, was mainly contained to a brief two months and quickly put in the rear view mirror. 2014 concluded as the sixth consecutive calendar year of positive returns (including dividends). It's easy to see how the potential for a correction may have been shuttled to the back of the mind. Other investors, with the memories of the severe bear markets of 2000 and 2008 still fresh, are quick to conclude that any selloff may be the harbinger of something far worse. Having invested through those years myself, that concern is understandable. Part of a financial advisor's job is education. Any discussion about the long-term positive average returns of stocks, bonds, real estate, or any asset class, should include the fact that those returns don't arrive smoothly,year in and year out. History demonstrates the certainty of unpredictable periods of decline with indeterminate length and severity. Academic research, and our own experience, have convinced me that there is no reliable way of predicting and avoiding these corrections, at least without substantially altering your risk profile. Note that avoiding corrections requires two accurate calls: identifying the peak to sell,then the bottom to reinvest, plus the drag of friction,transaction costs, and taxes. I know there are dozens of ways to make money in the markets, but I would be skeptical of anyone who claims to reliably avoid corrections. What does a stock market correction mean for the broader economy? Since stock prices reflect investors' opinions about earnings and growth,the economy, interest rates, and enthusiasm, declining prices necessarily signal a net decline in at least some of those factors, although it is very difficult to attribute which ones. S&P points out that all 11 postwar recessions were preceded by a correction, anticipated by an average of seven months. Unfortunately, corrections also produced a lot of false positives for recessions, providing an accurate forecast only 35%of the time. A correction is more of a yellow light, encouraging us to pay closer attention to our economic assumptions. Most corrections pass without a sustained contraction in economic growth. Bear markets have been more reliable recession predictors (67%). For an investor,the key is to acknowledge the likelihood of correction periods, then focus on the long term. Corrections come with the territory of equity investments, and the volatility they represent are part of the price of the higher long-term returns that stocks have historically provided. The discipline to stay invested through the downturns is often the sign of a successful investor. Keep in mind, stocks have recovered and then exceeded every prior correction, and I would not expect the current situation to end any differently. James Bell is a VP and financial advisor at Garrison Financial, a locally owned independent investment advisory firm. He can be reached at ibell@garrisonfiiianciahcQrn. GARRiSON F I N A N C I A L City of Fayetteville Firemen 's Pension & belief Fund Charles Schwab #7851-1206 Quarter Ending September 30, 2015 PORTFOLIO SUMMARY City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851.-1206 September 30, 2015 57.0 a Cash & Equivalents 796,511.32 ■ Account Fixed Income 710,163.28 Account Equities 1,997,658.84 Garrison Financial PORTFOLIO APPRAISAL City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 September 30, 2015 Adj Unit Total Adjusted Market Pet. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield CASH AND EQUIVALENTS Schwab Advisor Cash Res- 796,511.32 796,511.32 22.7 0.010 79.65 0.0 Premier 796,511.32 796,511.32 22.7 79.65 0.0 TREASURY NOTE 200,000 US Treasury Note 100.60 201,201.34 108.89 217,776.00 6.2 4.000 8,000.00 0.9 4.000%Due 08-15-18 Accrued Interest 1,000.00 0.0 201,201,34 218,776.00 6.2 8,000.00 0.9 CORPORATE BONDS 50,000 IBM Corp. 100.01 50,002.69 128.29 64,146.50 1.8 7.000 3,500.00 3.7 7.000%Due 10-30-25 Accrued Interest 1,458.33 0.0 50,002.69 65,604,83 1.9 3,500.00 3.7 COMMON STOCK 1,710 AT&T,Inc. 24.39 41,702.95 32.58 55,711.80 1.6 1.880 3,214.80 5.8 1,575 AbbVie,Inc. 24.35 38,357,14 54.41 85,695.75 2.4 2.040 3,213.00 3.7 1,575 Abbott Laboratories 22.46 35,371.29 40.22 63,346.50 1.8 0.960 1,512.00 2.4 1,250 BCE,Inc.CI F 24.40 30,494.62 40.96 51,200.00 1.5 2.630 3,287.50 6.4 350 Chevron Corporation 73.07 25,575.42 78.88 27,608.00 0.8 4.280 1,498.00 5.4 3,000 Cisco Systems,Inc. 17.43 52,302.90 26.25 78,750.00 2.2 0.840 2,520.00 3.2 2,200 Coca-Cola Company 26.40 58,074,28 40.12 88,264.00 2.5 1.320 2,904.00 3.3 1,200 ConocoPhillips 44.94 53,930.85 47.96 57,552.00 1.6 2.960 3,552.00 6.2 3,000 General Electric Co. 15.96 47,883.00 25.22 75,660.00 2.2 0.920 2,760.00 3.6 900 Genuine Parts Co. 36.65 32,986.53 82.89 74,601.00 2.1 2.460 2,214.00 3.0 1,500 G1axoSmithKhne Plc. 38.47 57,702.15 38.45 57,675.00 1.6 2.290 3,435.00 6.0 2,250 Intel Corp. 17.61 39,612.97 30.14 67,815.00 1.9 0.960 2,160.00 3.2 815 Johnson&Johnson 60.77 49,527.39 93.35 76,080.25 2.2 3.000 2,445.00 3.2 850 Kimberly Clark Corp. 58.18 49,454.69 109.04 92,684.00 2.6 3.520 2,992.00 3.2 1,300 Microsoft Corp. 26.30 34,185.86 44.26 57,538.00 1.6 1.440 1,872.00 3.3 1,000 Procter&Gamble Co. 50.46 50,458.56 71.94 71,940.00 2.1 2.650 2,650.00 3.7 700 Wal-Mart Stores,Inc. 50.36 35,248.98 64.84 45,388.00 1.3 1.960 1,372.00 3.0 732,869.59 1,127,509.30 32.2 43,601.30 3.9 MUTUAL FUNDS 1,296.008 Columbia Acorn Intl Z 38.58 50,000.00 39.15 50,738.71 1.4 0.670 868.33 1.7 14,455.268 Fed Interm Corp Bond 9.69 140,000.00 9.30 134,433.99 3.8 0.340 4,914.79 3.7 7,651.109 Natixis Loomis Sayles 13.07 100,000.00 12.34 94,414.69 2.7 0.400 3,060.44 3.2 Bond Fund 3,600.360 PIMCO Total Return Cl 11.11 40,000.00 10.47 37,695.77 1.1 0.240 864.09 2.3 D 4,683.407 SteelPath MLP Income 10.68 50,000.00 8.02 37,560.92 1.1 0.780 3,653.06 9.7 4,558.369 Vanguard Developed 10.97 50,000.00 11.44 52,147.74 1.5 0.350 1,595.43 3.1 Markets 1,387.374 Vanguard Emerging 3604 50,000.00 27.55 38,222.15 1.1 0.900 1,248.64 3.3 Mkts Stk Index 2,615.123 Vanguard Hi-Div Yid 19.12 50,000.00 24.81 64,881.20 1.9 0.820 2,144.40 3.3 3,412.116 Vanguard Mid-Cap 29.31 100,000.00 41.89 142,933.54 4.1 0.540 1,842.54 1.3 Growth 3,410.952 Vanguard Mid-Cap 29.32 100,000.00 43.12 147,080.25 4.2 1.390 4,741.22 3.2 Value 3,290.816 Vanguard Small-Cap 30.39 100,000.00 41.43 136,338.51 3.9 0.700 2,303.57 1.7 Growth I Garrison Financial PORTFOLIO APPRAISAL City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 September 30, 2015 Adj Unit Total Adjusted Market Pct. Unit Annual Quantity Security Cost Cost Price Value Assets Income Income Yield 3,324.742 Vanguard Small-Cap 30.08 100,000.00 41.63 138,409.01 3.9 0.800 2,659.79 1.9 Value 930,000.00 1,074,856.49 30.7 29,896.30 2.8 UNIT TRUSTS 400 iShares Barclays 7-10 104.43 41,771.06 107.87 43,148.00 1.2 2.060 824.00 1.9 yr Treasury 850 iShares DJ Select Div 4739 40,285.75 72,75 61,837.50 1.8 2.520 2,142.00 3.5 1,000 iShares IBOXX Inv 106.90 106,901.39 116.09 116,090.00 3.3 3.970 3,970.00 3.4 Grade Corp Bond _ 188,958.19 221,075.50 6.3 6,936.00 3.1 TOTAL PORTFOLIO 2,899,543.14 3,504,333.44 100.0 92,013.25 2.4 ,'ou should carefully compare this statement to the statement you receive from your custodian and notify us immediately of any discrepancies. 2 Garrison Financial PURCHASE AND SALE City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 From 01-01-15 To 09-30-15 Trade Settle Unit Date Date Quantity Security Price Amount SALES 05-07-15 05-12-15 1,000 American Electric Power 55.46 55,461.03 02-05-15 02-10-15 200 BCE,Inc. Cl F 47.41 9,482.29 02-05-15 02-10-15 100 BCE,Inc. Cl F 47.42 4,741.65 02-05-15 02-10-15 100 BCE, Inc. Cl F 47.42 4,741.65 02-05-15 02-10-15 100 BCE,Inc. Cl F 47.42 4,741.65 02-05-15 02-10-15 100 BCE,Inc. CI F 47.41 4,741.15 02-05-15 02-10-15 50 BCE, Inc. Cl F 47.41 2,370.57 02-05-15 02-10-15 400 BCE, Inc. Cl F 47.41 18,964.56 05-07-15 05-12-15 294 Chevron Corporation 107.69 31,659.67 05-07-15 05-12-15 56 Chevron Corporation 107.69 6,030.42 03-10-15 03-13-15 833 Duke Energy Corp. 74.79 62,298.30 03-10-15 03-13-15 750 Emerson Electric 56.15 42,114.77 04-08-15 04-13-15 106 Halyard Health,Inc. 48.95 5,189.20 02-05-15 02-10-15 100 Intel Corp. 33.94 3,393.81 02-05-15 02-10-15 200 Intel Corp. 33.94 6,787.64 02-05-15 02-10-15 200 Intel Corp. 33.94 6,787.64 02-05-15 02-10-15 100 Intel Corp. 33.94 3,393.81 02-05-15 02-10-15 100 Intel Corp. 33.94 3,393.81 02-05-15 02-10-15 200 Intel Corp. 33.94 6,787.64 02-05-15 02-10-15 67 Intel Corp. 33.94 2,273.86 02-05-15 02-10-15 233 Intel Corp. 33.94 7,907.61 02-05-15 02-10-15 275 Intel Corp. 33.94 9,332.45 04-08-15 04-13-15 1,520 Pfizer,Inc. 34.65 52,673.43 04-08-15 04-13-15 675 Sector SPDR Utility Select Shs 44.43 29,987.57 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.17 4,317.43 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.16 4,316.43 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.16 4,316.43 07-10-15 07-15-15 103 Sector SPDR Utility Select Shs 43.16 4,445.92 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.16 4,316.43 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.16 4,316.43 07-10-15 07-15-15 109 Sector SPDR Utility Select Shs 43.16 4,704.91 07-10-15 07-15-15 100 Sector SPDR Utility Select Shs 43.16 4,316.43 07-10-15 07-15-15 13 Sector SPDR Utility Select Shs 43.17 561.21 07-10-15 07-15-15 1,000 Sector SPDR Utility Select Shs 43.16 43,164.30 08-07-15 08-12-15 400 iShares Barclays 7-10 yr Treasury 106.27 42,508.04 08-07-15 08-12-15 600 iShares Barclays 7-10 yr Treasury 106.27 63,762.06 08-07-15 08-12-15 400 iShares IBOXX Inv Grade Corp Bond 115.71 46,282.65 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.57 1 Garrison Financial PURCHASE AND SALE City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 From 01-01-15 To 09-30-15 Trade Settle Unit Date Date Quantity Security Price Amount 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.67 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,571.07 08-07-15 08-12-15 100 iShares IBOXX Inv Grade Corp Bond 115.71 11,570.77 08-07-15 08-12-15 1,300 iShares IBOXX Inv Grade Corp Bond 115.71 150,417.24 1,033,133.10 2 Garrison Financial REALIZED GAINS AND LOSSES City of Fayetteville Firemen's Pension & Relief Fund Charles Schwab #7851-1206 From 01-01-15 Through 09-30-15 Gain Or Loss Open Close Cost Amort.or Date Date Quantity Security Basis Accretion Proceeds Short Term Long Term 12-31-05 02-05-15 200 BCE,Inc.Cl F 4,879.14 9,482.29 4,603.15 12-31-05 02-05-15 100 BCE,Inc.Cl F 2,439.57 4,741.65 2,302.08 12-31-05 02-05-15 100 BCE,Inc.Cl F 2,439.57 4,741.65 2,302.08 12-31-05 02-05-15 100 BCE,Inc.Cl F 2,439.57 4,741.65 2,302.08 12-31-05 02-05-15 100 BCE,Inc.Cl F 2,439.57 4,741.15 2,301.58 12-31-05 02-05-15 50 BCE,Inc.Cl F 1,219.78 2,370.57 1,150.78 12-31-05 02-05-15 400 BCE,Inc.Cl F 9,758.28 18,964.56 9,206.28 12-31-05 02-05-15 100 Intel Corp. 1,760.58 3,393.81 1,633.23 12-31-05 02-05-15 200 Intel Corp. 3,521.15 6,787.64 3,266.49 12-31-05 02-05-15 200 Intel Corp. 3,521.15 6,787.64 3,266.49 12-31-05 02-05-15 100 Intel Corp. 1,760.58 3,393.81 1,633.23 12-31-05 02-05-15 100 Intel Corp. 1,760.58 3,393.81 1,633.23 12-31-05 02-05-15 200 Intel Corp. 3,521.15 6,787.64 3,266,49 12-31-05 02-05-15 67 Intel Corp. 1,179.59 2,273.86 1,094.27 12-31-05 02-05-15 233 Intel Corp. 4,102.14 7,907.61 3,805.47 12-31-05 02-05-15 275 Intel Corp. 4,841.59 9,332.45 4,490.86 12-31-05 03-10-15 750 Emerson Electric 28,509.22 42,114.77 13,605.54 12-31-05 03-10-15 833 Duke Energy Corp. 47,880.89 62,298.30 14,417.41 12-31-05 04-08-15 106 Halyard Health,Inc. 2,139.84 5,189.20 3,049.36 12-31-05 04-08-15 675 Sector SPDR Utility Select 21,572.80 29,987.57 8,414.77 Shs 12-31-05 04-08-15 1,520 Pfizer,Inc. 25,116.11 52,673.43 27,557.32 12-31-05 05-07-15 1,000 American Electric Power 33,687.39 55,461.03 21,773.63 12-31-05 05-07-15 294 Chevron Corporation 21,483.35 31,659.67 10,176.32 12-31-05 05-07-15 56 Chevron Corporation 4,092.07 6,030.42 1,938.35 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195.97 4,317.43 1,121.46 Shs 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195 97 4,316.43 1,120.46 Shs 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195.97 4,316.43 1,120.46 Shs 12-31-05 07-10-15 103 Sector SPDR Utility Select 3,291.85 4,445.92 1,154.07 Shs 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195.97 4,316.43 1,12046 Shs 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195.97 4,316.43 1,120.46 Shs 12-31-05 07-10-15 109 Sector SPDR Utility Select 3,483.61 4,704.91 1,221.30 Shs 12-31-05 07-10-15 100 Sector SPDR Utility Select 3,195.97 4,316.43 1,12046 Shs 12-31-05 07-10-15 13 Sector SPDR Utility Select 415.48 561.21 145.73 Shs 12-31-05 07-10-15 1,000 Sector SPDR Utility Select 31,959.70 43,164.30 11,204.60 Shs 12-31-05 08-07-15 400 iShares Barclays 7-10 yr 41,771.06 42,508.04 736.98 Treasury 12-31-05 08-07-15 600 iShares Barclays 7-10 yr 62,656.59 63,762.06 1,105.47 Treasury 12-31-05 08-07-15 400 iShares IBOXX Inv Grade 42,760.55 46,282.65 3,522.10 Corp Bond 12-31-05 08-07-15 100 iShares IBOXX Inv Grade 10,690.14 11,570.77 880.63 Corp Bond 1