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CITY OF ELK RIVER,MINNESOTA
<br /> RECONCILIATION OF THE STATEMENT OF REVENUES,EXPENDITURES,
<br /> AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS
<br /> TO THE STATEMENT OF ACTIVITIES
<br /> FOR THE YEAR ENDED DECEMBER 31,2013
<br /> NET CHANGE IN FUND BALANCES-TOTAL GOVERNMENTAL FUNDS $ 4,272,692
<br /> Amounts reported for governmental activities in the statement of activities
<br /> are different because:
<br /> 1. Governmental funds report capital outlays as expenditures. However,in the
<br /> statement of activities,the cost of these assets is allocated over their estimated
<br /> useful lives and reported as depreciation expense. This is the amount by
<br /> which depreciation expense exceeded capital outlays in the current period.
<br /> Capital outlay $ 4,592,851
<br /> Depreciation expense (5,715,906) (1,123,055)
<br /> 2. The net effect of various miscellaneous transactions involving capital assets
<br /> including transfers and disposals,which decrease net position.
<br /> Transfers of capital assets (121,172)
<br /> Disposals (1,729,953)
<br /> Depreciation on disposals 1,385,090 (466,035)
<br /> 3. Revenues in the statement of activities that do not provide current financial
<br /> resources are not reported as revenues in the governmental funds.
<br /> Property taxes (99,912)
<br /> Special assessments (528,917)
<br /> Notes 109,281 (519,548)
<br /> 4. The issuance of long-term debt provides current financial resources to
<br /> governmental funds,while the repayment of the principal of long-term debt
<br /> consumes the current financial resources of governmental funds. Neither
<br /> transaction,however,has any effect on net position. Also,governmental
<br /> funds report the effect of premiums,discounts and similar items when debt
<br /> is first issued,whereas these amounts are deferred and amortized in the
<br /> statement of activities. The amounts below are the effects of these differences
<br /> in the treatment of long-term debt and related items.
<br /> Issuance of long-term debt (9,685,000)
<br /> Repayment of principal of long-tern debt 3,734,000
<br /> Bond premium (341,700) (6,292,700)
<br /> 5. Some expenses reported in the statement of activities do not require use of
<br /> current financial resources and,therefore,are not reported as expenditures
<br /> in governmental funds.
<br /> Accrued interest payable (19,459)
<br /> Amortization of issuance premium 51,072
<br /> Amortization of deferred charge from refunding (36,265)
<br /> Compensated absences (47,670)
<br /> Net OPEB obligation (39,451) (91,773)
<br /> CHANGE IN NET POSITION OF GOVERNMENTAL ACTIVITIES $(4,220,419)
<br /> The notes to the financial statements are an integral part of this statement.
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