2024 Financial Statements - Laserfiche WebLink

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NOTE I — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) S. Defelrxed Outflows/Inflows of Resources In addition :to assets and liabilities, statements of financial position, or balance sheets, will sometimes report deferred outflows or inflows of resources. Time. -separate financial statement elements represent a consumption or acquisition of net. position that applies -to a future period and so will not be recognized as an ou#flow ofreso..urces.{expense/expenditure) or an inflow of financial resources (revenue) until then. Unavailable revenue arises only .under a modified accrual basis of accounting .and,: therefore, .is only reported in the governmental funds financial statements. The governmental funds report unavailable .revenue from two souxoes: property taxes and special assessments. These aimount3 am deferred *and recognized as infloWs.ofresources in the period they becone.available. NOTE 2 — DEPOSITSANI) INVESTMENTS A. Components of Deposlis and Investments Cash and investments at year-end consist of the following: Deposits S 489,405 Investments 1.,179.275 Total S 1.6.68.680 B. Deposits In accordance with Minnesota Statutes, the City maintains deposits at financial institutions which are authorized -by the City Council,. including checking accounts and oeitificates of deposit. The following is considered the most significant risk associated with deposits: Custodial Credit Risk— In the. case of deposits. this is the risk that in the event of a bank failure, the City's deposits.maybe lost. Minnesota Statutes require-thatall deposits .be protected by federaC deposit insurance, .corporate suret}, bond, nr collateral. The market -value, of collateral pledged must equal 110 percent of the deposits not covered by federal deposit insurance or corporate surety bonds. Authorized collateral includes ti easu1y .bills..notes, and bonds; issues of.*U:S. �govetnment: agencies; general obligations rated "A" or better revenue obligations rated "AA" or better: irrevocable standard letters of credit. issued by the .Federal Home Loan Bank; and :certificates of deposit. Minnesota Statutes :requite. that securities pledged as collateral be held in safekeeping in a restricted account at the Federal Reserve Bank or in an account. at a trust. depart,nent of a commercial bank or other financial institution that i$ not owned or-eontrolled by the financial institution furnishing the. collateral. The -City has no -additional deposit policies addressing custodial credit risk. At :year end, the carrying amount of the City's deposits was $489,405, while the balance on the bank records was: $495,395. At December )1.� 2024. all deposits were fuliv covered by federal deposit insurance.. surety bands, or by collateral held by the City's agent in the City'-s name. -25-