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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 collectible within the current period or soon enough thereafter to be used to pay liabilities of the current period. Expenditures are recognized in. the period in which the fund liability is incurred, except for unmatured 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. are 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). snows 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 .fate 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 15th 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 Cauncil.for review in November. From the meeting a final budget and tax levy is developed and presented at a public hearing in November or December. 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 may be 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 approval can an activity be overspent and only if funding is available. However, the property tax levy cannot be amended.