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CITY OF ROSEVILLE MINNESOTA NOTES TO FINANCIAL STATEMENTS DECEMBER 37. 1992 Note t Surtmarv of Si9nificant Atcounting Polities (Continued) The goverrment reports deferred revenue on its combined haLance sheet. Deferred revenues arise when a potentiat revenue does not meet both the "measurable" and "availeble" criteria for recognition in the current period. Deferred revenues also arise uhen resources are received by the goverrvnent before it has e legal claim to them es when grant monies ere received prior to the incurrence of qualifying expenditures. In subsequent periods when both revenue recognition triteria are met or when the goverrment has e legal ctaim to the resources the liability for deferred revenue is removed fran the tombined balance sheet arxl revenue is recognized. Expenditures are generelty recognized tmder the modified accrual basis of accounting when the retated fund liability is incurred except for principat and interest on generat long-term debt which is recognized when due and ecnmulated unpaid vecation erd compensetory time off uhieh ere recognized when paid. E. Budgets and Budgetary Aecounting The City adopts en annual budget for the Generet and Special Revenue furds uhich ere prepared on the modified accruel besis of accounting. The edopted budget inditates the amount that can be expended by each fund besed on detaited bud9et estimates for individual expenditure accounts. Management mey make budget moditicetions uithin the fund level. Atl bud9et revisions at the fund level must be authorized by the City Council at the request of the City Maneger. The Councit under Ninnesota State Statutes Section 412.737 cen modify or amend the budget if unappropriated funds are available. Bud9et modificetion at the fund levet was necessary in 7992. The general fund uas amended dounuerd by the amount of 5134,105. AlL supplementat appropriations uere financed either by transfers fran the Contin9ency Section of the Generel Furd bud9et or by revenues received in excess of the lwdgeted amounts. Budget reductions were atcaiplished by reducing selected line items in seletted departments. All bud9et amounts lepse et the end of the year to the extent they have not been expended. The level uhith expenditures mey not tegalty exceed approprietions is at the fund level. F. Assets, Liabilities and Fund Eq�ity Investments - City investments ere carried et cost, uhich approximates merket. ( See note 3 for disctosures relating to tash management and investments.) Investments reported in the deferred conpensetion plen ere reported by the plen's trustees at merket velue. Procertv Texes - Property tax levies ere set by the City Countil in Detenber each year ard are certified to the County for collection the following year. !n Minnesota, counties ett es collection agents for all property taxes. The County spreads the levies over ell taxeble property in the City. Such taxes become receivebles of the City es of January 1. Property taxes are payabLe in equal installments by property ouners to the County es follows: Perso�al propercy - February 28 end June 30 Real property - Mey 75 and October 15 . The County remits the collections to the City end other taxing districts four times e year, on or before January 20, April 19, July 5, end December 4. Property tax revenue is recorded when it becomes meesurable end aveilable. Texes due fran Ramsey County on December 31, 1992, are included in 1992 revenue. � Unpaid taxes at Decenber 31 become liens on the respective property ard are ctessified in the finencial statertients as delinquent texes receivable. The receivable is fully offset by deferred revenue es it is not evailable to finance current expenditures. Taxes payable on homestead property (as defined by State statutes> ere pertielly reduced by e hanestead and agritultural eid (HACA). This eid is paid to the City by the State in tieu of taxes Levied egainst hanestead property. The State remits this eid in to equal instellments in July end Decenber eech year. Fixed Assets - General fixed assets are not cepitalized in the funds used to ecquire or construct them. Instead, capital acquisition ard conscruction ere reflected es expenditures in goverrvnentat funds, end the releted assets ere reported in the general fixed essets account group. All purchased fixed assets ere velued at cost where historicel records ere available and at en estimated historical cost uhere no historicat records exist. Donsted fixed assets are valued at their estimated fair merket value on the date received. 32