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CZTY OF ROSEVILLE, MINNESOTA <br />NOTES TO THE FZNANCIAL STATEMENTS (CONTINUED) <br />DECEMBER 31, 1982 <br />Note 1- Summarv of Significant Accounting Policies (Continued) <br />E. Assets, Liabilities and Fund Equity (Continued) <br />Reserve for Encumbrances- Encumbrances are reported for governmental type <br />funds and are not the equivalent of expenditures. Encumbrances are shown <br />as part of fund balance. They are recorded as reservation of fund balance <br />until expended or accrued as a liability of the fund. <br />Vacation, Sick and Compensatory Time Off Pay - The City compensates employees <br />upon termination for unused vacation and compensatory time off. Employees <br />are not compensated for unused sick pay upon termination of employment, <br />except upon retirement, at which time employees are entitled to one-half <br />of their accumulated leave up to one month's pay. Vacation and compensatory <br />time off are acc�ued when earned and sick pay is expensed when payment is <br />made in the proprietary funds. Vacation, compensatory time off, and sick <br />pay are recognized when payment is made in the governmental funds. Liability <br />for the governmental funds is reflected in the General Long-Yerm Ilebt�&ccount <br />Group. <br />Tota1 Columns on Combined Statements - Total columns on the combined <br />statements are captioned Memorandum Only to indicate they are presented <br />only to facilitate finaacial analysis. Data in these columns do not <br />present financial position, results of operations, or changes in financial <br />position in conformity with generally accepted accounting principles. <br />Neither is such data comparable to a consolidation. Interfund eliminations <br />have not been made in the aggregation of this data. <br />Note 2 - Accounting Changes <br />The method of determining vacation expense for the Enterprise funds was changed in <br />1982 from the cash basis to the accrual basis in conformity with the provisions of <br />FASB Statement No. 43. The financial statements of the Enterprise funds have been <br />restated from the effects of the change which reduced (increased) net income as <br />follows: <br />Liquor <br />Sanitary sewer <br />Water <br />Golf <br />Ice Arena <br />-35- <br />f[I:�1 <br />$ 268 <br />( 85) <br />(1,531) <br />1,091 <br />1,089 <br />832 <br />$ 195 <br />1,033 <br />479 <br />357 <br />797 <br />2 861 <br />