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<br />-30- <br />NOTE 7 – COMMITMENTS AND CONTINGENCIES <br /> <br />A. Legal Claims <br /> <br />The City has the usual and customary type of miscellaneous legal claims pending at year -end. Although <br />the outcome of these lawsuits is not presently determinable, the City’s management believes that the City <br />will not incur any material monetary loss resulting from these claims. No loss has been recorded on the <br />City’s financial statements relating to these claims. <br /> <br />B. Federal and State Funds <br /> <br />Amounts recorded or receivable from federal and state agencies are subject to agency audit and <br />adjustment. Any disallowed claims, including amounts already collected, may constitute a liability of the <br />applicable funds. The amount, if any, of claims which may be disallowed by the grantor agencies cannot <br />be determined at this time, although the City expects such amounts, if any, to be immaterial. <br /> <br /> <br />NOTE 8 – SUBSEQUENT EVENTS <br /> <br />New Accounting Standard <br /> <br />A new standard issued by the GASB will result in significant changes in the reporting of <br />subscription-based information technology arrangements (SBITAs) once it becomes effective for <br />governmental entities. This standard must be adopted by the City beginning in 2023, and may require the <br />restatement of certain balances reported as of December 31, 2022. The effects of this change have not yet <br />been determined and are not reflected in these financial statements. <br />