03.06 - Accounting and Reporting Policy Revisioins

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Committed — Self- imposed limitations set in place prior to the end of the year. These limitations must be imposed by the highest level of decision making authority at a local government and must also have a similar formal action by the same level of decision making authority to remove or modify the commitment. Assigned — Self- imposed limitations of fund balance resulting from intended use. These limitations can be established after year end, up to the date of issuance of the audit report and the authority to determine assigned fund balance can be delegated to someone other than the governing board. Unassigned — The residual classification of fund balances for the general fund. Any negative amounts in other governmental funds are reported as unassigned in the applicable fund. The City will commit fund balance in the general fund of up to 50% of the following year's general fund budgeted expenditures for cash flow purposes. 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. L. ALLOWANCE FOR UNCOLLECTIBLE RECEIVABLES Based on past experience, the City is able to collect almost all of its receivables. Amounts uncollectible have been immaterial. Based on this history, the City will only record an allowance for uncollectibles on a case by case basis, if needed. M. ELIMINATION OF INTERNAL ACTIVITY ON THE STATEMENT OF ACTIVITIES The City, as a general rule, eliminates the effect of interfund activity on the government -wide financial statements. The only interfund activities that will be reported on these financial statements are those between the two types of activities: governmental and business -type. N. APPLICATION OF FASB PRONOUNCEMENTS TO BUSINESS -TYPE ACTIVITIES The City generally follows private- sector standards of accounting and financial reporting issued prior to December 1, 1989 for the government -wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. The City has the option of following subsequent private- sector guidance for their business -type activities and enterprise funds, subject to the same limitation; however, the city elects not to follow subsequent private- sector guidance.