Other Auditor Reports 12/31/2007

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Accounting for Termination Benefits (GASB Statements No. 47) (Continued) The Statement also elaborates on how to measure the cost of termination benefits and requires disclosure of information about termination benefit arrangements, including a description of the plan and the cost of the benefits. Statement No. 47 is effective for financial statements for periods beginning after June 15, 2005. However, for termination benefits that affect defined benefit post employment benefits other than pensions, governments should implement Statement No. 47 simultaneously with Statement No. 45, Accounting and Financial Reporting by Employers for Post employment Benefits Other Than Pensions. Sales and Pledges of Receivables and Future Revenues and Intra- Entity Transfers of Assets and Future Revenues (GASB Statements No. 48) This statement is effective for periods beginning after December 15, 2006 and therefore, is applicable to the City for the year ended December 31, 2007. This statement clarifies accounting treatment for transactions involving the exchange of an interest in expected receivable or future revenue collections for immediate cash payments. Accounting and Financial Reporting for Pollution Remediation Obligations (GASB Statements No. 49) This statement is effective for periods beginning after December 15, 2007 and therefore, is applicable to the City for the year ended December 31, 2008. GASB Statement No. 49 requires governments to measure and report liabilities and expenditures resulting from pollution remediation obligations. The new standard is applicable to all pollution remediation except as associated with the following: Environmental obligations associated with landfills which are already covered under GASB Statement No. 18: Accounting for Municipal Solid Waste Landfill Closure and Post - closure Care Costs. Future pollution remediation activities that are required when an asset is retired except for newly retired assets where no liability has previously been recognized. Asset impairments which are already covered under GASB Statement No. 42: Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries. Any pollution prevention costs, fines, penalties, or any other non - remediation expenditures. Accounting for any environmental non - exchange transactions. Expenditure recognition or asset capitalization occurs when one of the following five obligating events takes place: The government is compelled to take pollution remediation action because of an imminent endangerment. The government violates a pollution prevention related permit or license. The government is named, or evidence indicates that it will be named, by a regulator as a responsible party or potentially responsible party for remediation, or as a government responsible for sharing costs. The government is named, or evidence indicates that it will be named, in a lawsuit to compel participation in pollution remediation. The government commences or legally obligates itself to commence pollution remediation.