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<br />. <br /> <br />CITY OF ARDEN HILLS, MINNESOTA <br />RECONClLlA TION OF THE STATEMENT OF REVENUES, EXPENDITURES <br />AND CHANGES IN FUND BALANCES TO TIlF_IT A. TEMF.1lI.Dl.' 1! rTTVlIlF~ <br />GOVEM'MENT, IDS I <br /> <br />coRnlli'''^'wDco'''''1l_-..ER'.,3.1 A- FT(I,-09,439) <br /> <br />Total net change in fund balances ~ governmental funds . . D <br /> <br />Amounts reported for governmental acti\lities in the statement <br />of activities are different because: <br /> <br />Capital outlays are reported in govenunental funds as expenditures. However, in the statement of <br />activities~ the cost of those assets is allocated over the estimated useful lives as depreciation <br />expLllse. <br />Capital outlay <br />Depreciation expense <br /> <br />1,079,410 <br />(365,384) <br /> <br />Governmental funds report a gain (Joss) on sale of capital assets 10 the extent of cash exchanged, <br />whereas the the disposition of the assets book value is included in the total gain (loss) in the <br />the statement of activities. <br /> <br />(521,792) <br /> <br />. <br /> <br />The issuance of bonds provides current financial resources to governmental fimcts, <br />while the repayment of the principal oflong-term debt consumes the current financial <br />resources of governmental funds. Neither transaction has any effect on net assets. <br />Also, governmental funds report thc effect of issuance costs, premiums discounts, <br />and similar items when debt is first issued, whereas these amounts are defcrred and <br />amortized in the statement of activities. The amounts below arc the effect of these <br />differences in the treatment oflong-term debt and related items_ <br />Amortization oftond discount <br />Principal repayments <br /> <br />(2,883) <br />2,545,000 <br /> <br />Interest on long-term debt in the statement of activities differs from the amount reported in the <br /> <br />govemmental funas oct.:ause interest is recognize.d as an c;;:pe..dirc.re in the fJnds when it is due, <br /> <br />and thus requires the use of current financial resources. In thc statement of activities, howevcr <br />interest expense IS recognized as the interest accrues, regardless of when it IS due_ <br /> <br />29,006 <br /> <br />Certain revenues are recognized as soon as it is earned. Under the modified accrual <br />basis of accounting certain revenues cannot be recognized until they are available <br />to liquidate liabllities ofthe current period. <br />Special assessments <br />Property taxes <br /> <br />335,691 <br />(42,039) <br /> <br />Some expenses reported in the statement of activities do not require the use of current <br />fina11cial resources and, therefore" are not reported as expenditures in governmental funds. <br />Compensated absences <br /> <br />9,804 <br /> <br />Change in net assets - governmental activities <br /> <br />$ 1,077,374 <br /> <br />. <br /> <br />The notes to the financial statements are an integral part of this statement. <br /> <br />-J2- <br />