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CITY OF ROSEVILLE, MINNESOTA <br />NOTES TO THE FINANCIAL STATEMENTS (CONTINUED) <br />DECEMBER 31. 1985 <br />Note 1- Summary of Significant Accountin� Policies (Continued) <br />B. Measurement Focus (Continued) <br />balance is considered a measure of "available spendable resources." Governmental <br />fund operating statements present increases (revenues and other financing sources) <br />and decreases (expenditures and other financing uses) in net current assets. <br />Accordingly, they are said to present a summary of sources and uses of "available <br />spendable resources" during a period. <br />Fixed assets are all recorded at historical cost or estimated historical cost, if the <br />original cost is not available. Donated fixed assets are stated at their fair market <br />value on the date donated. Additions to fixed assets for general City purposes, <br />including public domain (infrastructure) fixed assets, are recorded as an expenditure <br />of the applicable fund in the year in which the asset is purchased, and are <br />capitalized in the General Fixed Asset Account Group. Depreciation is not recorded <br />on these assets. <br />Long-term liabilities expected to be financed from governmental £unds are accounted <br />for in the General Long-term Debt Account Group, not in the governmental funds. The <br />single exception to the general rule is for special assessment bonds, which are <br />accounted for in special assessment funds. <br />The two account groups are not "funds". They are concerned only with the measurement <br />of financial position. They are not involved with measurement of results of <br />operations. <br />Noncurrent portions of long-term receivables due to governmental funds are reported <br />on their balance sheets, in spite of their measurement focus. However, special <br />reporting treatments are used to indicate in all governmental funds that they should <br />not be considered "available spendable resources", since they do not represent net <br />current assets. Recognition of revenues in these funds represented by noncurrent <br />receivables are deferred until they become current receivables. <br />Because of their spending measurement focus, expenditures recognition for <br />governmental fund types exclude amounts represented by noncurrent liabilities. Since <br />they do not affect net current assets, such long-term amounts are not recognized as <br />governmental fund type expenditures or fund liabilities. They are instead reported <br />as liabilities in the General Long-term Debt Account Group. <br />Proprietary funds are accounted for on a cost of services or "capital maintenance" <br />measurement focus. This means that all assets, including fixed assets, and all <br />liabilities, including long-term liabilities associated with their activity, are <br />included on their balance sheets. Their reported fund equity is segregated into <br />contributed capital and retained earnings components. Proprietary fund types <br />operating statements present increases (revenues) and decreases (expenses) in net <br />total assets. <br />Fixed assets of the Enterprise funds are capitalized in these funds. Depreciation is <br />charged as an expense against operations, and is provided on the straight-line <br />method. The following table summarizes depreciable lives of types of property. <br />-29- <br />