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MAYOR <br />Bill I3lcscncr <br />COUNCIL. <br />Rick Montour <br />John I<eis <br />Michael McGraw <br />Shelly Boss <br />515 Little Canada Road, Little Canada, MN 55117-1600 ADMINISTRATOR <br />(651) 766 -4029 / FAX: (651) 766-4048 Joel R. Manson <br />www.ci.litt(e- canada.mn.us <br />MEMORANDUM <br />TO: Mayor Blesener and Members of the City Council <br />FROM: Shelly Rueckert, Finance Director <br />DATE: December 16, 2011 <br />RE: GASB 54 Required Resolutions <br />Adoption of Fund Balance Policy <br />Approval of Proposed Year End Transfers <br />Resolution to close Funds 461, 462, and 463 (Exhibit A) <br />Under GASI3 54, the three funds related to 1 -IIA improvement projects are no longer <br />considered capital funds. Fund 461 will he closed and re- established as debt service <br />funds. Funds 462 and 463 will be reclassified as debt service funds for years ending <br />12/31/11 and 12/31/12 respectively. Please note that this does not change how the city <br />manages these funds; it only changes what section of the Annual Financial Report they <br />are presented in. <br />Resolution committing specific revenue sources as Special Revenue Funds <br />(Exhibit B) <br />Under GASB 54, a Special Revenue Fund must have "specific revenue sources that are <br />restricted or committed to expenditures for specific purposes ". This requires the Council <br />to adopt a resolution committing specific revenues to each of its Special Revenue Funds <br />prior to the end of the year. The commitments made by Council cannot change without <br />Council taking similar action to remove them. The current management practice <br />associated with these funds has been to use the funds' revenue sources for specific <br />purposes. Therefore, there will be no change in day -to -day practice. The only additional <br />requirement is that Council action will be necessary to change established practices. <br />1 <br />