05-28-2025 Council Packet - Laserfiche WebLink

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City of Little Canada, Minnesota Notes to the Financial Statements December 31, 2024 Note 1: Summary of Significant Accounting Policies (Continued) The City reports the following major governmental funds: The General fund is the City’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. The Infrastructure CIP fund is used to account for Capital Projects that relate primarily to street projects that were identified in the 15-Year Pavement Improvement Plan prepared in 2021. The General Capital Improvements fund was established to fund capital improvements and acquisition that are not accounted for in another Capital Project Fund, such as building improvements, equipment, and park improvements. The Economic Development fund was established to account for amounts received and spent on community development activities. The Fire Equipment Replacement fund was established to account for amounts received and related to fire department equipment. The City reports the following major proprietary funds: The Water fund accounts account for the provision of water services to the residents and business of the City. The Sewer fund accounts account for the provision of sewer services to the residents and business of the City. Nonmajor Governmental Funds Special Revenue funds account for revenue derived from specific revenue sources that are legally restricted or committed to expenditures for specific purposed. For additional information on specific Special Revenue funds, refer to the Special Revenue fund statements. Debt Service Funds account for the accumulation of resources and payment of bond principal and interest on long-term general obligation debt of governmental funds. Capital Project funds are used to account for the financial resources to be used for the acquisition or construction of major capital facilities. For additional information on Capital Projects funds, refer to the Capital Projects fund statements. Additionally, the City reports the following fund types: Internal Service funds account for the City’s property, liability, worker’s compensation and retiree health insurance provided to other departments within the City. As a general rule the effect of interfund activity has been eliminated from government-wide financial statements. Exceptions to this general rule are transactions that would be treated as revenues, expenditures or expenses if they involved external organizations, such as buying goods and services or payment in lieu of taxes, are similarly treated when they involve other funds of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the City’s enterprise funds and of the City’s internal service funds are charges to customers for sales and services. The City also recognizes as operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the system. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. 65