Laserfiche WebLink
City of Lino Lakes, Minnesota <br />Management Report, Page 9 <br />ACCOUNT BALANCE ANALYSIS OF THE <br />COMBINED FINANCIAL STATEMENTS <br />The combined financial statements of the City of Lino Lakes are presented in Statements 1 <br />through 5 of the 1988 Annual Financial Report. The following comments relate to the Combined <br />Balance Sheet - All Funds (Statement 1). <br />Cash and Investments <br />Cash and investments were as follows at December 31, 1988 and 1987: <br />December 31, Increase <br />Description 1988 1987 (Decrease) <br />Treasurer's balance - checking ($17,198) $13,452 ($30,650) <br />Petty cash 150 150 0 <br />Investments: <br />Certificate of deposits 2,193,904 1,752,331 441,573 <br />Small Business Administration <br />(SBA) 0 67,970 (67,970) <br />4M money market fund 24,651 0 24,651 <br />FNMA Pool 264,505 304,722 (40,217) <br />NOW account 359,043 157,465 201.578 <br />Totals $2,825,055 $2,296,090 $528,965 <br />The City maintains an average negative balance in the City's checking account. These negative <br />balances are "book" balances only. These balances indicate that the City is depositing cash which <br />is not needed for current expenses into interest bearing accounts. We recommend that the City <br />continue this practice of minimal balances in the City's checking account to increase interest <br />earnings. <br />Interest on investments totaled $147,742 in 1988 and $108,098 in 1987. The ability of a city <br />to generate investment earnings is an indication of sound fiscal management. Interest earnings are <br />required for the City to meet bonded debt payments in those funds which have received assessment <br />prepayments. Assessment prepayments reduce future interest generated from the assessment rolls <br />and therefore must be replaced through investment earnings. Capital project monies are restricted <br />through bond resolution and/or City Council policy. Interest earned in these funds increases the <br />restricted assets which is intended to be expended at a future date. The interest earnings of the <br />General and Special Revenue Type Funds indicate that the City is maintaining operating reserves in <br />these funds. Operating reserves are mandatory to compensate for cash flow timing differences in <br />the receipt of major revenue sources and for various other purposes as discussed later in this report <br />(see "General Fund "). <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />1 <br />