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CITY OF ROSEVILLE, MINNESOTA NOTES TO FINANCIAL STATEMENTS December 31, 2016 With the initial capitalization of general infrastructure assets (i.e., those reported by governmental activities), the City chose to include all such items regardless of their acquisition date or amount. The City’s Pavement Management Plan contained all historical costs for the City’s general infrastructure assets. As the City constructs or acquires additional capital assets each period, including infrastructure assets, they are capitalized and reported at historical cost. The reported value excludes normal maintenance and repairs which are essentially amounts spent in relation to capital assets that do not increase the capacity or efficiency of the item or extend its useful life beyond the original estimate. Donated capital assets are recorded at their acquisition value on the date of donation. Property, plant and equipment of the City are depreciated using the straight-line method over the following estimated useful lives: Assets Years Buildings 40 Building Improvements 25 Furniture and Equipment 5 Light Vehicles 5 Heavy Vehicles 10 Fire Trucks 20 Streets and public infrastructure 50 Utility distribution systems 80 The City implemented GASB 51, Accounting and Financial Reporting for Intangible Assets effective January 1, 2010, which required the City to capitalize intangible assets. Pursuant to GASB Statement 51, in the case of initial capitalization of intangible assets, the City chose to capitalize intangible assets retroactively to 1980. The City was able to obtain historical costs and estimated fair value of donated intangible assets as of the date of donation for the initial reporting of easements through public works project records. 6. Deferred outflows/inflows of resources In addition to assets, the statement of financial position will sometimes report a separate section f o r d e f e r r e d o u t f l o w s o f r e s o u r c e s . T h i s s e p a r a t e f i n a n c i a l statement element represents c o n s u m p t ion of net position that applies to future period(s) and so will not be recognized as an outflow of resources (expense/expenditures) until that time. The City has one item that qualifies f o r r e p o r t i n g i n t h i s c a t e g o r y . T h e p r e s e n t s d e f e r r e d o u t f lows of resources on the Statement(s) of N e t position for deferred outflows of resources related to pensions. Deferred outflows of r e s o u r c e s r e l a t e d t o p e n s i o n s r e s u l t s f r o m t h e d i f f e r e n c e b etween projected and actual earnings, c h a n g e s i n a c t u a r i a l a s s u m p t i o n s a n d e m p l o y e r c o n t r i b u t i o n paid to PERA subsequent to the m e a s u r e m e n t d a t e . In addition to liabilities, the statement of financial position and fund financial statements will sometimes report a separate section for deferred inflows of resources. This separate financial 46 Item 8: Attachment D