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does not have any Internal Service Funds, Fiduciary Funds are used when a government holds or manages. financial resources. in an agent or fiduciary capacity, The City of Gem Lake does not operate any of these funds at the current time. The Budget Basis used by the City of Gem Lake is the modified accrual basis of accounting for governmental fund types (for example, the General Fund, Special Revenue Funds, Debt Service and. Capital, Project Funds). Under this accounting method, revenues are recognized in the accounting period in which they become available and measurable. Available means. col lectible. withi n the current period or soon enough thereafterto be used to pay liabilities of the current period. Expenditures are recognized in the period in which the fund liability is incurred, except for unmatureo interest on general long-term debt, which is recognized. when due.. Enterprise Funds use the accrual basis of accounting. Under the accrual basis revenues are recognized when they are measurable and earned. Expenses a.re recognized in the period incurred, if measurable. The budget basis for Enterprise and. Internal Service Funds. is also the. accrual basis with the exceptions noted below. The City's Comprehensive Annual Financial Report (CAFR) shows the status of the City's finances on the basis of "generally accepted accounting principles" (GAAP). This conforms to the.way the City prepares its budget. The CAFR shows fund expenditures on both a GAAP basis and budget basis for comparison purposes. BUDGET PROCESS The budget process begins: in August with the City Treasurer developing a draft budget. The Mayor and Treasurer then meet in .late: August or early September to refine the draft budget. It is this budget that is presented to the full City Council in a workshop session in early September. It is from this workshop that a preliminary tax levy is presented and adopted no later than September 15t11 of each year. Once adopted the preliminary levy is certified to Ramsey County. Over the next few months the Mayor and Treasurer develop a final draft budget and tax levy, which again is presented to the full City Council for review in November. From the.meeting a final budget and tax levy is developed and presented at a public hearing in November. After the public hearing the City Council votes to approve the budget and adopt the final property tax. levy. In late December the final levy is certified to the County Auditor. During the fiscal year line; items maybe overspent as long as the total activity budget is not. overspent. The Mayor can recommend changes for activities' budget to the City Council. The Council can than approve or disapprove the change, in the form .of.a budget amendment. Only with the City Council approvalcan. an.activity be overspent and only if funding.is available. However,. the property fax levy cannot be amended.