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ELK RIVER MUNICIPAL UTILITIES
<br /> ELK RIVER,MINNESOTA
<br /> NOTES TO THE FINANCIAL STATEMENTS
<br /> DECEMBER 31,2014
<br /> Note 2: DETAILED NOTES ON ALL FUNDS-CONTINUED
<br /> • Concentration of Credit Risk. Is the risk of loss attributed to the magnitude of a government's investment in a
<br /> single issuer.According to their investment policy the Utilities'portfolio maturities shall be staggered to avoid
<br /> undue concentration of assets in any one type of instrument.
<br /> • Interest Rate Risk. Is the risk that changes in interest rates will adversely affect the fair value of an investment.
<br /> According to their investment policy the Utilities'will stagger maturities to avoid undue concentration of assets
<br /> at a specific maturity sector.
<br /> B. Capital assets
<br /> Capital asset activity for the year ended December 31,2014 was as follows:
<br /> Beginning Ending
<br /> Balance Increases Decreases Balance
<br /> Capital assets not
<br /> being depreciated
<br /> Land $ 360,952 $ 351 $ - $ 361,303
<br /> Construction in progress 2,265,169 1,843,677 (3,293,136) 815,710
<br /> Total capital assets
<br /> not being depreciated 2,626,121 1,844,028 (3,293,136) 1,177,013
<br /> Capital assets being depreciated
<br /> Land improvements 63,147 - (39,758) 23,389
<br /> Buildings 3,761,899 - (87,299) 3,674,600
<br /> Machinery and equipment 4,778,167 574,786 (2,134,517) 3,218,436
<br /> Infrastructure 79,446,094 3,293,136 (9,505,755) 73,233,475
<br /> Total capital assets
<br /> being depreciated 88,049,307 3,867,922 (11,767,329) 80,149,900
<br /> Less accumulated
<br /> depreciation for
<br /> Land improvements (49,301) (935) 35,783 (14,453)
<br /> Buildings (1,540,347) (118,624) 80,566 (1,578,405)
<br /> Machinery and equipment (3,539,612) (229,202) 2,132,458 (1,636,356)
<br /> Infrastructure (36,666,509) (2,649,071) 9,471,909 (29,843,671)
<br /> Total accumulated
<br /> depreciation (41,795,769) (2,997,832) 11,720,716 (33,072,885)
<br /> Total capital assets
<br /> being depreciated,net 46,253,538 870,090 (46,613) 47,077,015
<br /> Business-type activities
<br /> capital assets,net $ 48,879,659 $ 2,714,118 $ (3,339,749) $ 48,254,028
<br /> 87
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