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CITY OF GEM LAKE, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER.31, 2016 <br />NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES. (CONTINUED) <br />B. Basic Financial Statements (Continued) <br />1, Government -Wide Statements (Continued) <br />In the government -wide statement. of net position, both the governmental and <br />business -type activities columns: (a) are presented on a consolidated basis by <br />column; and (b) are reported on. a full accrual, economic resource basis, which <br />recognizes all long -terra assets and receivables as well as long-term debt and <br />obligations. The City's net position is reported in three parts: (1) net investment in <br />capital assets; (2) restricted net position; and (3).unrestricted net position. The City <br />first utilizes. restricted resources to finance qualifying activities. <br />The statement of activities demonstrates the degree to which the direct expenses of <br />each. function of the City's governmental activities and different business -type activity <br />are offset by program revenues, Direct;. expenses are those that are clearly <br />identifiable vvi#Yt a specific function or activity. Program revenues include: (1) fees, <br />fines, and charges paid by the.recipients of goads, services, or privileges provided <br />by a given function or activity; and-,(2) grants and.;contributions: that. are restricted. to. <br />meeting. the operational or capltak= require ants of a particular function or activity, <br />Revenues that are not classified ds: program revenues, including all taxes, are <br />presented as general revenues:-: <br />:2. Fund Financial Statements;. <br />The fund. financial statemerits-provide information about the City's funds. Separate <br />statements for_;each, fit rd category, governmental and proprietary, are presented. <br />The ernph..asis'of governmental and proprietary fund financial statements is on major <br />individual governmental and enterprise funds., with each displayed as. separate <br />columns in the ;fund financial statements. All remaining governmental and enterprise <br />funds are aggregated.8nd reported as nonmajor funds. <br />(14) <br />