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<br />Management Discussion and Analysis - Continued <br />May 4, 2006 <br /> <br />Figure 2 summarizes the major features of the City's fInancial statements, including the portion of the City government they <br />cover and the types of information they contain. The remainder of this overview section of management's discussion and analysis <br />explains the structure and contents of each of the statements. <br /> <br />Figure 2 <br />Major features of the Government-wide and Fund Financial Statements <br /> <br /> Fund Financial Statements <br /> Government-wide Governmental Funds Proprietary Funds <br /> Statements <br />Scope Entire City government The activities of the City that Activities the City operates <br /> (except fIduciary funds) and are not proprietary or similar to private businesses, <br /> the City's component units fIduciary, such as police, fIre such as the water and sewer <br /> and parks system <br />Required fInancial . Statement of Net Assets . Balance Sheet . Statements of Net Assets <br />statements . Statement of Activities . Statement of Revenues, . Statements of Revenues, <br /> Expenditures, and Expenses and Changes in <br /> Changes in Fund Fund Net Assets <br /> Balances . Statements of Cash <br /> Flows <br />Accounting Basis and Accrual accounting and ModifIed accrual accounting Accrual accounting and <br />measurement focus economic resources focus and current fInancial economic resources focus <br /> resources focus <br />Type of asset/liability All assets and liabilities, both Only assets expected to be All assets and liabilities, both <br />information fInancial and capital, and used up and liabilities that fInancial and capital, and <br /> short-term and long-term come due during the year or short-term and long-term <br /> soon thereafter; no capital <br /> assets included <br />Type of in flow/out flow All revenues and expenses Revenues for which cash is All revenues and expenses <br />information during year, regardless of received during or soon after during the year, regardless of <br /> when cash is received or paid the end of the year; when cash is received or paid <br /> expenditures when goods or <br /> services have been received <br /> and payment is due during <br /> the year or soon thereafter <br /> <br />Government-wide Financial Statements <br /> <br />The government-wide financial statements are designed to provide readers with a broad overview of the City's fInances, in a <br />manner similar to a private-sector business. <br /> <br />The statement of net assets presents information on all of the City's assets and liabilities, with the difference between the two <br />reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of whether the fInancial <br />position of the City is improving or deteriorating. <br /> <br />The statement of activities presents information showing how the City's net assets changed during the most recent fIscal year. All <br />changes in net assets are reported as soon as the underlying event giving rise to the change occurs, regardless of the timing of <br />related cash flows. Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows <br />in future fIscal periods (e.g., uncollected taxes and earned but unused vacation leave). <br /> <br />Both of the government-wide fInancial statements distinguish functions of the City that are principally supported by taxes and <br />intergovernmental revenue (governmental activities) from other functions that are intended to recover all or a signifIcant portion <br />of their costs through user fees and charges (business-type activities). The governmental activities of the City include general <br />government, public safety, public works, economic development, culture and recreation, miscellaneous and interest on long-term <br />debt. The business-type activities of the City include water and sewer. <br /> <br />-III- <br />