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' 1 <br /> CITY OF ST. ANTHONY ' <br /> NOTES TO FINANCIAL STATEMENTS <br /> DECEMBER 31 , 1999 ' <br /> Note 1 . Significant Accounting Policies, continued <br /> C. Measurement Focus, continued <br /> Proprietary funds are accounted for on a cost of services or flow of economic re- ' <br /> sources measurement focus. With this measurement focus, all assets and all liabili- <br /> ties (whether current or non-current) associated with the operation of these funds <br /> are included on the balance sheet. Reported fund equity is segregated into contri- <br /> buted capital and retained earnings components. Proprietaty fund type operating <br /> statements present increases .(revenues) and decreases (expenses) in net total assets. <br /> Depreciation of all exhaustible fixed assets used by proprietary funds is charged <br /> as an expense against their operations. <br /> The accounting and reporting treatment applied to fixed assets and long-term liabi- <br /> lities associated with 'a fund are determined by its measurement focus. <br /> d in governmental fund t ' <br /> Fixed assets use g type operations are accounted for in the <br /> General Fixed Assets Account Group, rather than. in individual governmental funds. <br /> Fixed assets are valued at historical cost, except for donated fixed assets, which ' <br /> are valued at their estimated fair value on the date received. No depreciation has <br /> been provided on general fixed assets. <br /> Long-term liabilities expected to be financed from governmental funds are accounted ' <br /> for in the General Long-Term Debt Account Group, rather than in governmental funds. <br /> Because of their spending measurement focus, expenditure recognition for governmental <br /> fund types is limited to exclude amounts represented by non-current liabilities. ' <br /> Since they do not affect net current assets, long-term amounts are not recognized <br /> as governmental fund type expenditures or fund liabilities. They are. instead <br /> reported as liabilities in .the General Long-Term Debt Account Group. . ' <br /> These two account groups are not funds and are concerned only with the measurement of <br /> financial position; they are not involved with measurement of results of operations. ' <br /> Special reporting treatment is also applied to prepaid expenses of governmental <br /> funds to indicate that prepaid expenses do not represent "available spendable re- <br /> sources," even though they are a component of net current assets. ' <br /> D. Basis of Accounting <br /> Basis of accounting refers. to when revenues and expenditures or expenses are' recog- ' <br /> nized and reported in the financial statements regardless of the measurement focus. <br /> Governmental funds are accounted for using the modified accrual basis of accounting. <br /> Revenues are recognized when they become both measurable and available as net current <br /> assets. Measurable means the amount of the transaction can be determined and avail- <br /> able means collectible within the current period or soon enough thereafter to pay ' <br /> current liabilities. Major revenues that are susceptible to accrual include property <br /> taxes, special assessments, intergovernmental revenues, charges for services and <br /> investment income. Revenue sources not susceptible to accrual include licenses and ' <br /> permits, fees and other revenues; such revenues are recorded only when received be- <br /> cause they are not measurable until collected. <br /> -14- ' <br />