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<br />. <br /> <br />. <br /> <br />. <br /> <br />Note 2: <br /> <br />CITY OF ARDEN HILLS, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS <br />DECEMBER 31, 2003 <br /> <br />STEW ARDSIDP, COMPLIANCE AND ACCOUNTABILITY - CONTINUED <br /> <br />C. Deficit Fund Equity <br /> <br />The following funds had fund eqnity deficit, at December 31, 2003: <br /> <br />FlUld <br /> <br />Deficit <br /> <br />Special revenue <br />Recreation Program <br />Economic Development Authority <br />Capital projects <br />Municipal Land and Bnildings <br /> <br />$ <br /> <br />13,7 52 <br />685,731 <br /> <br />65,365 <br /> <br />The deficits will be eliminated with future revenue sources and transfers from other flmds. <br /> <br />Note 3: DETAILED NOTES ON ALL FUNDS AND ACCOUNTS <br /> <br />A~ Deposits and Investments <br /> <br />Cash balances of the City's funds are combined (pooled) and invested to the extent available in various <br />investments authorized by Minnesota statutes. Each fund's portion of this pool (or pools) is displayed on the <br />[mancial statements as "cash and temporary investments". For purposes of identifying the risk of investing public <br />funds, the balances 3re categorized as follows: <br /> <br />Deposits <br /> <br />In accordance '\Vith Minnesota statutes and as authorized by the Council, the City maintains deposits at those <br />depository banks, all of which are members of the Federal Reserve System. <br /> <br />Minnesota statutes require that all City deposits be protected by insurance, surety bond or collateraL The market <br />value of collateral pledged must equal 110 percent of the deposits not covered by insurance or bonds (140 <br />percent in the case of mortgage notes pledged). <br /> <br />Authorized collateral includes. the legal investments described below, as well as certain first mortgage notes, and <br />certain other State or local government obligations. Minnesota statutes require that securities pledged as <br />collateral be held in safekeeping by the City or in a fmancial institution other than that furnishing the collateral. <br />The City has deposits with a hank and a book value of$6,766,972 that are entirely covered with FDIC insurance <br />at December 31, 2003. <br /> <br />lnvestments <br /> <br />Investments are categorized into these three categories of credit risk: <br /> <br />1. Insured or registered, or securities held by the City or its agent in the City's name. <br /> <br />2. Uninsured and unregistered, with securities held by the counterparty's trust department or agent in tbe <br />City's name. <br /> <br />3. Uninsured and unregistered, with securities held by the counte:q>arty, or by -its trust departtnent or agent but <br />not in the City's name. <br /> <br />-17. <br />