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HOUSING -AND REDEVELOPMENT AUTHORITY OF ST. ANTHONY NOTES TO FINANCIAL STATEMENTS DECEMBER 31 , 1999 Note 1 . Significant Accounting Policies, continued C. Measurement Focus The accounting and reporting treatment applied to fixed assets and long-term liabi- lities associated with a fund are determined by its measurement focus. All govern- mental funds are accounted for on a spending or current financial resources measure ment. focus. ' ,With this measurement focus, only current assets and current liabilities , are generally included on the balance sheet of each fund. Reported fund balance (net current assets) is considered a measure of "available spendable resources. Operating statements of these funds present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Fixed assets used in governmental fund type operations are accounted for in the General Fixed Assets Account Group, rather than in, individual governmental funds. Fixed assets are valued at historical cost, except for donated fixed assets, which are valued at their estimated fair value on the date received. No depreciation has been provided on general fixed assets. Long-term liabilities expected to be financed from governmental funds are accounted for in the General Long-Term Debt Account Group, 'rather than in governmental funds. Because of their spending measurement focus, expenditure recognition for governmental fund types is limited to exclude amounts represented by non-current liabilities. Since thet do not affect net current assets, long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. They are instead reported as liabilities in the General Long-Term Debt Account Group. These two account groups are not funds and are concerned only with the measurement ' of financial position. The account groups are not involved with measurement of results of operations. D. Basis of Accounting IBasis of accounting refers to when. revenues and expenditures are recognized and reported in the financial statements regardless of the measurement focus. All funds of the Authority are accounted for using the modified accrual basis of accounting. Revenues are recognized when they become both measurable and available as net cur- rent assets. Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to pay current liabilities. Major revenues that are susceptible to accrual include property taxes, intergovernmental revenues and investment income. Other revenue sources are not susceptible to accrual ; such revenues are recorded only when re- ceived because thay are not measurable until collected. Expenditures are generally recognized under the modified accrual basis of account- , ing when the related fund liability is incurred, except for principal and interest on general long-term debt which are recognized when due. Fixed assets of the Authority are accounted for in the General Fixed Assets Account Group, rather than in individual funds. Land and other assets acquired, which are subsequently sold to other parties, are considered a cost of the project. -9- 1