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CITY OF LINO LAKES, MINNESOTA Statement 6
<br />RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES,
<br />EXPENDITURES, AND CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES
<br />Year Ended December 31, 2015
<br />Net Change in Fund Balances -Total Governmental Funds $ (2,486,348)
<br />Amounts reported for governmental activities in the statement of activities are different because:
<br />Governmental funds report capital outlays as expenditures. However, in the statement of
<br />activities, assets are capitalized and the cost is allocated over their estimated useful lives
<br />and reported as depreciation expense.
<br />Capital outlays $ 9,680,582
<br />Loss on disposal of capital assets (74,607)
<br />Depreciation expense (4,590,922) 5,015,053
<br />The governmental funds report bond proceeds as financing sources, while repayment of
<br />bond principal is reported as an expenditure. In the statement of net position, however,
<br />issuing debt increases long-term liabilities and does not affect the statement of activities and
<br />repayment of principal reduces the liability. Also, governmental funds report the effect of
<br />premiums and discounts when debt is first issued, whereas these amounts are deferred and
<br />amortized in the statement of activities. Interest is recognized as an expenditure in the
<br />governmental funds when it is due. In the statement of activities, however, interest expense
<br />is recognized as it accrues, regardless of when it is due. The net effect of these differences
<br />in the treatment of general obligation bonds and related items is as follows:
<br />Issuance of bonds
<br />(7,445,000)
<br />Issuance of equipment certificates
<br />(1,161,250)
<br />Bond premium
<br />(114,960)
<br />Repayment of bond principal
<br />2,751,000
<br />Change in accrued interest expense for general obligation bonds
<br />(88,511)
<br />Amortization of bond premium
<br />8,691
<br />Amortization of bond discount
<br />(3,595) (6,053,625)
<br />Delinquent and noncurrent property taxes and special assessments receivable will be
<br />collected subsequent to year-end, but are not available soon enough to pay for the current
<br />period's expenditures and, therefore, are not available in the governmental funds.
<br />Unavailable resources - December 31, 2014 (9,708,584)
<br />Unavailable resources - December 31, 2015 9,825,337 116,753
<br />In the statement of activities, compensated absences and other post employment benefits are
<br />measured by the amounts earned during the year. In the governmental funds, however,
<br />expenditures for these items are measured by the amount of financial resources used
<br />(essentially, the amounts actually paid). During fiscal year 2015, compensated absence
<br />payable and other post employment benefits payable increased. (52,739)
<br />Pension expenses in the governmental funds are measured by current year employee
<br />contributions. Pension expenses on the Statement of Activities are measured by the change
<br />in the net pension liability and the related deferred inflows and outflows or resources (143,376)
<br />Change in Net Position of Governmental Activities $ (3,604,282)
<br />The accompanying notes are an integral part of these basic financial statements.
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