VLAWMO Annual Financial Report 2018

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VADNAIS LAKE AREA WATER MANAGEMENT ORGANIZATION NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2018 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) Assets, Deferred Outflows of Resources, Liabilities, Deferred Inflows of Resources, and Net Position/Fund Balance (Continued) Restricted Assets Certain assets of the Organization are set aside for repayment of individual property owners once they meet specific criteria. Accounts Receivable Accounts receivable include amounts billed for services provided before year-end. Special Assessments Special assessments represent storm sewer utility charges. These assessments are recorded as receivables upon certification to the County. Special assessments are recognized as revenue in the year they are collected or received in cash or within 60 days after year-end. General Fund special assessments receivables are offset by deferred inflows of resources or unearned revenue in the fund financial statements. Capital Assets Capital assets, which include property, plant, and equipment, are reported in the applicable governmental activities columns in the govemment-wide financial statements. Capital assets are defined by the Organization as assets with an initial, individual cost of more than $5,000 (amount not rounded) and an estimated useful life in excess of one year. Such assets are recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets are recorded at estimated acquisition value at the date of donation. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend assets lives are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets is included as part of the capitalized value of the assets constructed. Property, plant, and equipment of the Organization are depreciated using the straight-line method over the following estimated useful lives: Infrastructure 15 — 30 Years Equipment 5 — 7 Years (24)