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CITY OF ROSEVILLE, MINNESOTA NOTES TO THE FINANCIAL STATEMENTS DECEMBER 31, 1985 Note 1- Summarv of SiQnificant AccountinQ Policies The City of Roseville, Minnesota, was incorporated on May 28, 1948, and became a statutory City on January 1, 1974. The City operates under a Council-Manager form of government, and provides for all the various services as authorized by State statute, including the following: general government, public safety, public works, parks and recreation, water and sewer utility, and community development. The accounting policies of the City of Roseville conform to generally accepted accounting principles applicable to governmental units. The £ollowing is a swnmary of the more significant policies. Reporting Entity The City's financial statements include all funds, account groups, departments, agencies, boards, commissions, and other organizations over which City officials exercise oversight responsibility. Oversight responsibility includes such aspects as appointment of governing body members, budget approval, approval of property tax levies, outstanding debt secured by City full faith and credit or revenues, responsibility for funding de£icits, and others. As a result of applying the entity definition criteria, the following organizations have been excluded £rom the City's financial statements. Excluded: Fire Relief Association - This Association is organized as a nonprofit organization by their members to provide pension and other benefits to such members in accordance with Minnesota statutes. The board of directors is appointed by the membership of the organization. All funding is conducted in accordance with Minnesota Statutes, whereby state aids flow to the associations, tax levies are determined by the Association and are only reviewed by the City, and the Association pays benefits directly to their members. (See Note 7 for disclosures relating to the pension plan operated by the Association.) Independent School Districts No. 621 and 623: These Districts, like all school districts in Minnesota, are completely independent of any other governmental entity. They have their own elected Boards of Education, levy their own taxes and prepare their own financial reports. A. Fund Accounting The accounts of the City are organized on the basis of funds and account groups, each of which is considered a separate accounting entity. The operations of each fund are accounted for with a separate set of self-balancing accounts that comprise its assets, liabilities, fund equity, revenues, and expenditures, or expenses, as appropriate. Government resources are allocated to and accounted for in individual funds based upon the purposes for which the}z are to be spent and the means by which spending activities are controlled. The various funds are grouped in the financial _27_