Annual Financial Report 12/31/1985

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CITY OF LINO LAKES, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 1985 Note 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) The following types of funds and account groups are employed by the City: GOVERNMENTAL FUNDS The General Fund - to account for all financial resources except those required to be accounted for in another fund. Special Revenue Funds - to account for the proceeds of specific revenue sources (other than special assessments, expendable trusts, or for major capital projects) that are legally restricted to expenditure for specified purposes. Debt Service Funds - to account for the accumulation of resources for, and the payment of, general long -term debt principal, interest, and related costs. Capital Project Funds - to account for financial resources to be used for the acquisition or construction of major capital facilities (other than those financed by Proprietary Funds, Special Assessment Funds, and Trust Funds). Special Assessment Funds - to account for the financing of public improvements or services deemed to benefit the properties against which special assessments are levied. PROPRIETARY FUNDS Enterprise Funds - to account for operations: (a) that are financed and operated in a manner similar to private business enterprises - where the intent of the governing body is that the costs (expenses, including depreciation) of pro- viding goods or services to the general public on a continuing basis be financed or recovered primarily through user charges; or (b) where the governing body has decided that periodic determination of revenues earned, expenses incurred, and /or net income is appropriate for capital maintenance, public policy, management control, accountability, or other purposes. FIDUCIARY FUNDS Trust and Agency Funds - to account for assets held by a governmental unit as an agent for individuals, private organizations, other governmental units and /or other funds. ACCOUNT GROUPS The governmental fund types are designed to account for the financial flow of a particular fund; therefore, they generally include only current assets and current liabilities on their balance sheets. The City maintains two account groups to account for noncurrent assets and long -term liabilities as follows: General Fixed Assets - The City maintains a separate group of accounts which contain the fixed assets used in the governmental fund type operations. They are assets of the City as a whole and not of individual funds.