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CITY OF GEM LAKE, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER 311, 2013 <br />NOTE T 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-term 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. riot 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 with a. specific function or activity. Program revenues include: (1) fees, <br />fines, and. charges paid by the recipients of goods, 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 capital requirements of a particular function or activity. <br />Revenues that are. not classified as program revenues, including all taxes, are <br />presented as general revenues. <br />2. Fund Financial Statements <br />The fund financial statements provide information about.the City's funds,. Separate <br />statements for each fund category, governmental and proprietary, are presented. <br />The emphasis.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 and reported, as nonmajor funds. <br />(16) <br />