CCP 05-27-1997 - Laserfiche WebLink

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I I. CITY OF ARDEN HILLS, MINNESOTA NOTES TO FINANCIAL STATEMENTS I Note I: DECEMBER 31, 1996 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED I The Capital Projects jimds account for the acquisition of fixed assets or construction of major capital projects not being financed by proprietary funds. I Proprietary funds are accounted for on the flow of economic resources measurement focus and use the accrual basis of accoWlting. Under this method, revenues are recorded when earned and expenses are recorded at the time liabiIities are incurred. The City applies all applicable F ASB pronouncements in accounting and reporting for its proprietary operations. Proprietary funds include the following fund type: I Enterprise jimds and used to account for those operations that are financed and operated in a manner similar to private business or where the Council has decided that the determination of revenues earned, costs incurred I andlor net income is necessary for management accountability. Fiduciary funds account for assets held by the government in a trustee capacity or as an agent on behalf of others. I The agency fimd is custodial in nature and does not present results of operations or have a measurement focus. Agency funds are accounted for using the modified accrual basis of accounting. This fund is used to accolDlt for assets that the government holds for others in an agency capacity. I ACCDunt Groups. The general fIXed assets account group is used to acCOWlt for fixed assets not accounted for in proprietary funds. The general long-term debt account group is used to accoWlt for general long-term debt and Ie certain other liabilities that are not specific liabilities of proprietary funds. C. Assets, Liabilities and Equity I Deposits and Investments The City's cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with original maturities of three months or less from the date of acquisition. Restricted assets are I included in cash and cash equivalents. State statutes authorize the City to invest in obligations of the U.S. Treasury, commercial paper, corporate bonds, repurchase agreements and shares of investment companies registered WIder the Federal Investment Company I Act of 1940 and whose only investments are obligations guaranteed by the United States or its agencies. Investments are stated at lower of cost or amortized cost Earnings on investments are allocated to the individual funds based upon the average of month-end cash and investment balances. I Property Taxes I The Council annually adopts a tax levy and certifies it to the CoWlty for collection. The COWlty is responsible for collecting all property taxes for the City. These taxes attach an enforceable lien on taxable property within the City on January I and are payable by the property owners in two installments. The taxes are collected by the CoWlty Auditor - Treasurer and tax settlements are made to the City during January, JWle and November each I year. Taxes payable on homestead property, as defined by State statutes, are partially reduced by a homestead and agricultural credit aid. The credit is paid to the City by the State of Minnesota in lieu of taxes levied against I. homestead property. The State remits this credit in two equal installments in July and December each year. Delinquent taxes receivable include the past six years' Wlcollected taxes. Delinquent taxes have been offset by a deferred revenue liability for delinquent taxes not received within 60 days after year end. I I -11-