CCP 05-27-1997 - Laserfiche WebLink

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, '. CITY OF ARDEN HILLS, MINNESOTA NOTES TO FINANCIAL STATEMENTS I Note 5: DECEMBER31,1996 OTHER INFORMATION I A. Risk Management The City is exposed to various risks of loss related to torts; theft ot; damage to and destruction of assets; errors I and omissions; injuries to employees; and natural disasters for which the City carries commercial insurance. Settled claims have not exceeded this commercial coverage in any of the past three fiscal years. Liabilities are reported when it is probable that a loss has occurred and the amount of the loss can be reasonably I estimated. An excess coverage insurance policy covers individual claims in excess 0[$100,000. Liabilities, if any, include an amount for claims that have been incurred but not reported (IBNRs). The City's management is not aware of any incurred but not reported claims. I B. Deferred Compensation Plan The City offers its employees a deferred compensation plan created in accordance with Internal Revenue Service I Code Section 457. The plan, available to all full-time and certain part-time employees at their option, permits participants to defer a portion of their salary until future years. The deferred compensation assets are not available to employees until tennination, retirement, death or unforeseen emergency. I All amounts of compensation deferred under this plan, all property and rights purchased with those amounts, and all income attributable to those amounts, property or rights are (until paid or made available to the participant or beneficiary), solely the property of the City, subject only to the claims of the City's general creditors. Participants' rights under the plan are equaI to those of general creditors of the City in an amount equaI to the I. fair market valne of the deferred account for each participant It is the opinion of the City's legal counsel that the City has no liability for losses under the plan but does have I the duty of due care that would be required of an ordinary prudent investor. The City believes it is unlikely that it will use the assets to satisfy the claims of general creditors in the future. Assets of the plan are held by l1ustees and are reflected in these statements in the Agency Funds at market value. I C. Segment Information for Proprietary Funds The City provides services which are accounted for in the Enterprise Funds. The segment information for these I Enterprise Funds for the year ended December 31, 1996 is as follows: Surface Water I Water Sewer Recyclinr M:mAO'P.ft'Ient Total Operating revenue $ 1097037 $ I 042 591 $ 72 808 $ 171 277 $ 2383719 DeJlI"Ciation expense 78 366 75 650 - 88 154104 I Operating income 251 947 95 880 1761 14543 364131 Net income before transfers 282 248 138 183 2743 17656 440 830 I Operating transfers out (72699) - - - (72 699) Acquisition of fixed assets 34 365 29 252 - - 63616 Net working capital 784217 I 027 593 31681 67182 1910 673 I Total assets 5491 385 3588716 89458 69 904 9 239 463 Total equity 5352931 3 562 907 31681 67477 9014996 I. I -19- ---------------