2012-04-11 CC Packet - Laserfiche WebLink

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CITY OF CENTERV I L L E, MINNESOTA NOTESTOTHE FINANCIAL STATEMENTS DECEMBER 31, 2011 Note 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES- CONTINUED The City reports the following major governmental funds: The General fund isthe City's primary operating fund. It accounts for all financial resourcesof the City, except those required to be accounted for in another fund. The Debt Service fund accounts for the resources accumul ated and payments made for pri nci pal and i nterest on long -term general obligation debt of governmental funds. The Park fund captures al I park capital items and recei ves al I the City's park dedication fees. The City reports the folIowing major propri etary f unds: The Water fund accounts for the acti vities of the water distri bution system the City mai ntai ns. The Sewer fund accounts for the activities of the City's sewage collection operations. The Storm Water fund accounts for the acti vitiesof the City's storm water collection operations. Private - sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government -wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of GASB. Governments also have the option of folIowi ng subsequent private - sector guidance for thei r busi ness -type acti vi ties and enterprise funds, subject to this same I i mitati on. The City has elected not to fol low subsequent private - sector guidance. As a general rule the effect of i nterfund acti vi ty has been el i mi nated from government -wi de f nanci al statements. Exceptions to this general rule are charges between the City's water and sewer function and various other functions of the City. Elimination of these charges would distort the direct costs and program revenues reported for the various functions concerned. Amounts reported as program revenues i ncl ude 1) charges to customers or applicants for goods, services or pri vi leges provided, 2) operating grants and contribution, and 3) capital grants and contributions, including special assessments. I nternal ly dedicated resources are reported as general revenues rather than as program revenues. Li kewise, general revenues i ncl ude al I taxes. Proprietary funds disti nguish operating revenues and expenses from nonoperating items. Operati ng revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund's pri nci pal ongoi ng operations. The pri nci pal operati ng revenues of the Ci ty enterpri se funds are charges to customers for sales and servi ces. Operati ng expenses for enterpri se funds i ncl ude the cost of sal es and servi ces, admi ni strati ve expenses and depreciation on capital assets. All revenues and expenses not meeting thi s def i ni ti on are reported as nonoperati ng revenues and expenses. When both restricted and unrestricted resources are avai I abl e for use, it i s the City's pol i cy to use restricted resources f rst, then unrestri cted resources as they are needed. -51-