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CITY OF LINO LAKES, MINNESOTA Statement 6
<br />RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES, AND
<br />CHANGES IN FUND BALANCE TO THE STATEMENT OF ACTIVITIES
<br />Year Ended December 31, 2011
<br />Net Change in Fund Balances -Total Governmental Funds $ (4,232,807)
<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 activities,
<br />assets are capitalized and the cost is allocated over their estimated useful lives and reported as
<br />depreciation expense.
<br />Capital outlays
<br />Contributed capital assets
<br />Proceeds from sales of capital assets
<br />Depreciation expense
<br />$ 603,226
<br />1,980,000
<br />(50,953)
<br />(2,919,383)
<br />The governmental funds report bond proceeds as financing sources, while repayment of bond
<br />principal is reported as an expenditure. In the statement of net assets, however, issuing debt
<br />increases long -term liabilities and does not affect the statement of activities and repayment of
<br />principal reduces the liability. Also, governmental funds report the effect of issuance costs,
<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 is
<br />recognized as it accrues, regardless of when it is due. The net effect of these differences in the
<br />treatment of general obligation bonds and related items is as follows:
<br />Issuance of equipment certificates (120,000)
<br />Repayment of bond principal 2,595,000
<br />Change in accrued interest expense for general obligation bonds 76,214
<br />Amortization of bond issuance costs (31,237)
<br />Amortization of bond premium 13,087
<br />Amortization of bond discount (2,470)
<br />Delinquent and deferred property taxes and special assessments receivable will be collected
<br />subsequent to year -end, but are not available soon enough to pay for the current period's
<br />expenditures and, therefore, are deferred in the governmental funds.
<br />Deferred revenue - December 31, 2010
<br />Deferred revenue - December 31, 2011
<br />9,130,784
<br />12,643,772
<br />(349,531)
<br />2,530,594
<br />3,512,988
<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 (essentially,
<br />the amounts actually paid). During fiscal year 2011, compensated absence payable and other post
<br />employment benefits payable decreased. 4,945
<br />Change in Net Assets of Governmental Activities $ 1,466,189
<br />The accompanying notes are an integral part of these basic financial statements.
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