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CITY OF ROSEVSLLE, MINNESOTA NOTES TO FINANCIAL STATEMENTS (CONTINUED) DECEMBER 31, 1987 Note 1- Summarv of Sianificant Accountinq Policies (Continued) expenditures, or expenses, as appropriate. Government resourres a�e attocated to and accounted tor in individuaL funds hased upon the purposes for which they are to be spent and the means by which spending activities are controtted. The various funds are grouped in the financiat statements report into seven generic fund types and three broad fund caTegories as foLLows: GOVERNMENTAL F�NDS GeneraL Fund - The General Fund is the primary operating fund ot the City. It is used to account for atL finantiat resources except those required to 6e accounted for in another tund. Speciat revenue funds - Speciat revenue funds are used to account for the proceeds of certain specific revenue sources that are LegaLty restricted to expenditures for spetified purposes. Debt service funds - Debt service funds are used to account for the accumulation of resources for, and the payment of generaL Long-term debt principal, interest, and related costs. Capital projects funds - Capital projects funds are used to account for financiat resources to be used for the acquisition or construction of major capital facilities other than those finanwd 6y proprietary funds. PROPRIETARY FUNDS Enterprise Funds - Enterprise Funds are used to atcount for operations that are financed and operated in a manner simiLar to private 6usiness enterprises, where the intent of the governing body is that the costs (expenses, incWding depreciation) ot providing goods or services to the generaL pu6Lic on a continuing basis be financed or recovered primarily through user charges. The City has five Enterprise Funds: Water �titity Fund, Sewer UtiLiTy Fund, Storm Drainage Fund, Gotf Fund and Ice Arena Fund. Internal Service Funds - Internat Service Funds are used to accouM for the fina�cing of goods or services provided 6y one department or agency to other departments or agencies of the City. The Ci[y has two Internal Service Funds, they are: Workers' Compensation Setf-Insurance Fund which accou�ts for the City's workers' compensation daims, and the Risk Management Fund which accounts for aLL of the City's generaL insurance costs. FIDUCTARY FUNDS Agency funds - Agency Funds are used to account for the assets heLd by the City in a trustee capaciiy or as an agent for individuaLs, private organizations, other governments, and/or other funds. The City's Agency Funds are wstodial in nature (assets equaL LiabiL9ties) and do not invoLve measurement of resutts of operations. 6. Measu�ement Focus 7he accounting and reporting treatment appLied to the fixed assets and Long-term lia6iLities associated with a fund are determined by its measurement focus. GovernmentaL funds and Expendabte Trust funds are acrounted for on a spending or 'financiaL fLow" measurement fows. This means that onLy current assets and current liabiLities are generaLLy incLuded on their balance sheets. Their reported fund 6alance is -29-