Annual_Report_1988_001 - Laserfiche WebLink

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CITY OF ROSEVILLE, MINNESOTA NOTES TO FINANCIAL STATEMENTS lCONTINUED) DECEMBER 31.1988 Note 1- Summarv of Siqnificant Accountinq Poticies (Continued) percentage increase in households or population, vhi<hever is greater. Levies for bonded indebtedness are not Limited 6y the law. Taxes payable on homestead property (as defined by State statutes) are partially reduced 6y a homestead credit. This credit is paid to the City 6y the State in lieu of taxes levied against homestead property. The State remits this credit in two equal instaLlments in Juty and December each year. Fixed Assets - GeneraL fixed asse[s are not capitalized in the funds used to acquire or construct them. Instead, capi2al acquisition and construction are refLected as expenditures in governmental funds, and the related assets are repor[ed in the generaL fixed assets account group. ALl purchased fixed assets are valued at cost where histroical records are availa6te and at an estimated historical cost where no histori- cal records exist. Donated fixed assets are valued at their estimated fair market vaLue on the date re- ceived. 7he costs of normaL maintenance and repairs that do not add to the value of the asset or materialty extend asset Lives are not capitalized. Improvements are capitalized and depreciated over the remaining usefut lives of the related fixed assets, as apptica6Le. � PubLic damain ('infrastructure') general fixed assets consisting of roads, bridges, curhs and gutters, streets and sidevalks, a�d lighting systems are not wpitatized, as these assets are immovable and of vatue only to the government. Assets in the generat fixed assets account group are not depreciated. Depreciation of buitdings, equipment and vehides in the proprietary types is computed using the straight-tine method. Interest is capitatized on proprietary tunds assets acquired with tax-exempt debt. The amount of interest to be [apitaLized is catculated by offsetting interest expense incurred from the date of the borrowing untiL compLetion of the project with interest earned on invested proceeds over the same period. SpeciaL Assessments - Special assessments are Levied against the benefited properties for the assessable costs of speciat assessment improvement projects in accordance with State statutes. The City usualty adopts the assessment roLls when the individuat projects are complete or su6stantiatLy complete. The assessments are cotLectibte over a term of years generatly consistent with the term of years of the related bond issue. ColLection of annuat instaLLments (including interestJ is handled 6y the County in che same manner as property taxes. Property owners are altowed to prepay total future instalLments without interest or prepayment penalties. Inventories - Inventories hetd hy the Enterprise funds are stated at the Lower ot cost or market, using ihe first-in, first-out method. The cost of inventory is recognized as expense at the time the items are sotd or used (consumption method). 6titity service charges are rewgnized when earned with no aLLowance for uncoLtecti6Les as delinquent accounts are certified as a Lien against the property biLled. Unbilled utility service charges are inctuded in receivahles at year-end. Encumbrances - Encumbrances represent purchase commitments. Encumbrances outstanding at year-end are reported as reservations of fund baLances since they do not constitute expenditures or LiabiLities. 32