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CITY OF ROSEVILLE NOTES TO FINANCIAL STATEMENTS DECEMBER 31, 2001 NOTE 1- SUMMARY OF SIGTTIFICANT ACCOUNTING POLICIES (Continued) C. Measurement focus, basis of accounting, and financial statement presentation (Continued) The City reports the following major proprietary funds: The sanitary sewer fund and the water fund account for the activities related to the operation of a sanitary distribution system and a water distribution system, respectively. The gotf course fund, accounts for resources and payments related to the operation and maintenance of a municipal golf course. The recycling fund accounts for the resources and expenditures related to the operation of a waste recycling collection systems. The storm drainage fund accounts for activities related to the operation of a surface water collection system. Additionally, the City reports the following fund types: Internal service funds account for the worker's compensation and general insurance services provided to other departments or agencies of the City. The trust fund accounts for the investment activities for a not-for profit organization devoted to providing cable television oversight for a group of communities of which the City is a member. Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally aze followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private- sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The City has elected not to follow subsequent private-sector guidance. As a general rule the effect of interfund activity has been eliminated from the government-wide financial statements. Exceptions to this rule are payments in-lieu of taxes and other charges between the City's water and sewer function and various other functions of the City. Elimination of these charges would distort the direct costs and program revenues reported from the various functions concerned. Amounts reported as program revenues include 1) charges to customers or applicants for goods, services, or privileges provided, 2) operating grants and contributions, and 3) capital grants and contributions, including special assessments. Internally dedicated resources aze reported as general revenues rather than as program revenues. Likewise, general revenues include a11 taxes. 40