12.02 - Amendment to Accounting and Reporting Procedures

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100% of the compensated absences will be reported as liabilities due within more than one year. The city will review the compensated absences on an individual basis to determine if any portion will be due within one year. G. APPLYING RESTRICTED AND UNRESTRICTED RESOURCES The city will first use restricted resources to finance qualifying activities. Any remaining qualifying activities will be financed with unrestricted resources. H. ALLOCATION OF INDIRECT EXPENSES Indirect expenses will be allocated to the funds and departments that share in the expense, if determinable and possible. If the entire city or many city departments are involved, the cost will be recorded in the city hall department budget. I. CLASSIFICATION OF OPERATING AND NON - OPERATING REVENUES IN ENTERPRISE FUNDS Operating revenues in an enterprise fund are those that support the day -to -day operations of the activities in that fund. These revenues cover costs such as salaries, supplies, repairs and maintenance, depreciation, and small tools and equipment. • Water — user fees (billed monthly), sale of water meters, Gopher State 1 -call fees, inspection fees, water use permits, connect/reconnect fees, penalties, charges for repairs • Sewer — user fees (billed monthly), inspection fees, charges for repairs, permits, penalties Non - Operating revenues in an enterprise fund are those revenues that occur from non - operations of the enterprise activities, including, but not limited to, such items as property taxes; local, state or federal grants; interest income from investments; property rental; assessments; and other miscellaneous revenue. J. IDENTIFICATION AND APPLICATION OF RESERVED AND UNRESERVED FUND BALANCES Reserved fund balances indicate the portion of fund equity which has been legally segregated for specific purposes. Unreserved, designated fund balances indicate the portion of fund equity for which the City has made tentative plans. The City will designate a fund balance of up to 50% of the following year's general fund budget for cash flow purposes. Unreserved, undesignated fund balances indicate the portion of fund equity which is available for budgeting in future periods. K. DEFINITION OF CASH AND CASH EQUIVALENTS Cash and cash equivalents include: cash on hand, demand deposits, and short-term `. investments with original maturities of 3 months or less from the date of acquisition. 12 -1 -08 ACCOUNTING AND REPORTING POLICIES (amendments): 11/29/2010 6