Annual_Report_1995_001 - Laserfiche WebLink

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• :• . . .:. -„ �. • �:��:�; •• � Note14._�iisk_Management The City is exposed to vazious risks of loss related to torts; theft of, damage to, and the des[ruction of assets; errors and omissions: injuries [o employees; and natural disasters. The City established intemal service funds in 1980 and 1987 respectively, to account foc workers' compensation and general liability risk. The Workers' Compensation Fund provides coverage up to a maximum of $250,000 for each claim. The City purchases excess loss coverage from the Workers' Compensation Reinsurance Association, a nonprofit organization established by State Starute. The Risk Management Fund provides comprehensive general liabiliry and comprehensive automotive liability up to the starutory maximum of $600,000. The Ciry retains the risk of the first $50,000 of each occurrence with an annual mazimum exposure of $100,000. While all funds participate in the program, only enterprise funds make direct payments to the Workers' Compensa[ion Fund and the Risk Management Fund. An annual taz is levied for all other operatiag funds. Enterprise fuad chazges and the property tac lery aze based on a management estimate of claims history and the amount necessary to maintain catastrophe reserves. The reserves as of December 31, 1995, were $874,111 and $1,048,439 for the Workers' Compensation Fund and Risk Management Fund respectively. The claims liability of $30,457 and $4,000 respectively reported in both funds at December 31, 1995 is based on the requiremenu of Governmental Accounting Standards Boazd Statement No. 10, which requires that a liabiliry for claims be reported if information prior to the issuance of the fmancial statements indicates that it is probable that a liabiliry has been incurred at the date of the fmancial statements and the amount of the loss can be reasonably estimated. Changes in the Funds' claims liabiliry amount in fiscal 1994 and 1995 were: 1994 1995 Siorket's_Gompensation_Fund Beginning of Fiscal Current Yeaz Claims and YrazLiabiliry �hangesinEs[imates C'la;m� Payments $ 30,197 $ 89,784 $ 86,611 33,370 48,048 50,961 BiskManagement.Fund Beginning of Fiscal YeacLia6ility 1994 $ 4,000 1995 4,000 No�e..15 -Deferre�CompensarionPlan Current Year Claims and Changes_in_Estima[es $ 8,970 100,162 �laims_P_ayments $ 8,970 100,162 Balance at Eiscat_Year End $ 33,3'10 30,457 Balance at Eiscal_Year End $ 4,000 4,000 The City offers its' employees a deferred compensation plan established in accordance with Internal Revenue Code Section 457. The plan, available to all employees, permits them to defer a ponion of their salary until fumre years. The deferred compensation is not avaitable to employees until termination, retirement, death, or unforeseeable emergency. All amounts of compensation deferred under the plan, all property and rights purchased with those amounts, and all income attributable to those amounts or rights aze (until paid or made available to the employee or other beneficiary) solely the property and rights of the Ciry, subject only to claims of the City's general creditors. Participants' rights under the plan are equal to those of the Ciry in an amount equa] to the fair mazket vatue of the deferred account for each participant. Plan assets of $1,698,683 at December 31, 1995 aze shown in the financial statements as a"Deposits with Trustees" in the agency funds with a corresponding credit to deposits payable. 'm'