Laserfiche WebLink
<br />-22- <br />NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) <br /> <br />L. Net Position <br /> <br />In the government-wide and proprietary fund financial statements, net position represents the differences <br />between assets, deferred outflows of resources, liabilities, and deferred inflow of resources. <br /> <br />Net position is displayed in three components: <br /> <br />• Net Investment in Capital Assets – Consists of capital assets, net of accumulated depreciation, <br />reduced by any outstanding debt attributable to acquire capital assets. <br /> <br />• Restricted Net Position – Consists of net position restricted when there are limitations imposed <br />on their use through external restrictions imposed by creditors, grantors, or laws or regulations of <br />other governments. <br /> <br />• Unrestricted Net Position – All other net position that does not meet the definition of <br />“restricted” or “net investment in capital assets.” <br /> <br />The City applies restricted resources first when an expense is incurred for which both restricted and <br />unrestricted resources are available. <br /> <br />M. Fund Balance Classifications <br /> <br />In the fund financial statements, governmental funds report fund balance in classifications that disclose <br />constraints for which amounts in those funds can be spent. These classifications are as follows: <br /> <br />• Nonspendable – Consists of amounts that are not in spendable form, such as prepaid items, <br />inventory, and other long-term assets. <br /> <br />• Restricted – Consists of amounts related to externally imposed constraints established by <br />creditors, grantors, or contributors; or constraints imposed by state statutory provisions. <br /> <br />• Committed – Consists of internally imposed constraints that are established by resolution of the <br />City Council. Those committed amounts cannot be used for any other purpose unless the City <br />Council removes or changes the specified use by taking the same type of action it employed to <br />previously commit those amounts. <br /> <br />• Assigned – Consists of internally imposed constraints. These constraints consist of amounts <br />intended to be used by the City for specific purposes, but do not meet the criteria to be classified <br />as restricted or committed. In governmental funds, assigned amounts represent intended uses <br />established by the governing body itself or by an official to which the governing body delegates <br />the authority. <br /> <br />• Unassigned – The residual classification for the General Fund, which also reflects negative <br />residual amounts in other funds. <br /> <br />When both restricted and unrestricted resources are available for use, it is the City’s policy to first use <br />restricted resources, then use unrestricted resources as they are needed. <br /> <br />When committed, assigned, or unassigned resources are available for use, it is the City’s policy to use <br />resources in the following order: 1) committed, 2) assigned, and 3) unassigned.