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CITY OF ST. ANTHONY NOTES TO FINANCIAL STATEMENTS DECEMBER 31 , 1999 Note 1. Significant Accounting Policies, continued tP. Bonded Indebtedness ' The City has general obligation and revenue bonds outstanding. General obligation bonds consist of the following types; improvement, refunding tax increment, tax increment and taxable tax increment bonds. Bonds payable associated with these is- sues' are recorded as liabilities in the General Long-Term Debt Account Group. Prin- t cipal and interest payments related to these bonds, including payments due January 1 , are recorded as expenditures when paid; interest is not accrued unless fully matured and not paid. Revenue bonds are recorded as a liability in the proprietary funds. 1 For these bonds, interest is accrued and recorded as an expense as incurred. Q. Fund Equity ' Contributed capital is recorded in.proprietary fund types that have received capital grants or contributions from other sources. A substantial portion of the City's utility system was financed by special assessments, grants and other contributions. When such assets are acquired they are credited to the contributed capital account. Depreciation on these assets is charged as an expense against current income. ' Investment in general fixed assets represents the City's equity in fixed assets owned by the City and not recorded in its proprietary funds. Reserves represent portions of fund equity not available for expenditure or legally ' segregated for a specific future. use. Designated fund balances are tentative plans for future use of current financial resources. Unreserved and undesignated fund equity represents amounts available to finance future expenditures or operations. ' R. Interfund Transactions 1 Quasi-external transactions are accounted for as revenues and expenditures, as appli- cable to each fund. Transactions that constitute reimbursements to a fund for expen- ditures initially made from it that are properly applicable -to another fund are re- corded as expenditures in the reimbursing fund and as a reduction of expenditures in the fund that is reimbursed. All other interfund transactions are reported as transfers. Nonrecurring or non- ' routine permanent transfers of equity are reported as residual equity transfers. All other interfund transfers are reported as operating transfers. ' S. Use of Estimates The preparation of these financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that ' affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenditures or expenses during the reporting period. Actual ' results could differ from those estimates. -19-