SECTOR II AMPLIACION , V ETAPA
PARQUES Y JARDINES INAFECTO
June 30, 2006
54
(2) RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS, CONTINUED
1) Capital assets used in governmental activities are not current financial resources and, there- fore, are not reported in the balance sheet:
Cost of Construction in Progress, Fine Art,
and Infrastructure capital assets $ 138,565,008
Accumulated depreciation (39,898,349)
Infrastructure capital assets, net $ 98,666,659 2) Long-term liabilities are not due and payable
in the current period and, therefore, are not reported in the balance sheet:
Bonds payable $ 34,175,000
Less: original issue discount (amortized over the life of the bonds to interest
expense (251,176)
Less: deferred bond issuance costs (amortized over the life of the bonds
to interest expense) (291,193)
Plus: interest payable 147,173
Infrastructure long-term
liabilities, net $ 33,779,804
3) Internal service funds are used by manage- ment to charge to individual user funds the costs of acquisition, construction, financing, maintenance and capital accumulation for the replacement of governmental capital assets (except for infrastructure and fine art assets – see #1 above); operations of the City’s com- puter, reprographics and cable TV operations, the City’s self-insurance programs and its em- ployee benefits. The assets and liabilities of the internal service funds are included in gov- ernmental activities in the statement of net assets. Net assets total:
Invested in capital assets, net of related debt $ 78,752,527
Restricted 1,622,034
Unrestricted 54,215,278
Internal service funds net assets $ 134,589,839
4) Certain reclassifications and eliminations are re- quired to properly state governmental activities in the statement of net assets:
– Pension contribution, is a use of
current financial resources and an expenditure at the fund level, is deferred and recognized as a net pension asset on the Statement
of Net assets 2,988,318
Net increase in pension assets 2,988,318 – Certain interest receivables are not available
to pay for current-period expenditures and,
therefore, are deferred in the funds 83,593 Certain property tax receivables are not avail-
able to pay for current-period expenditures
and, therefore, are deferred in the funds 1,816,751 Certain sales tax receivables are not avail-
able to pay for current-period expenditures
and, therefore, are deferred in the funds 2,432,377 Net reduction in deferred revenue 4,332,721 – Fund balances are reclassified and restated
into three categories of net assets: invested in capital assets net of related debt, restric- ted and unrestricted.
Fund balances, reserved (26,102,863)
Fund balances, unreserved (83,194,510)
Invested in capital assets, net of
related debt 27,218,373
Net assets, restricted 43,229,433
Net assets, unrestricted 46,170,606
Net fund balance reclassifications 7,321,039 Net reclasses and eliminations $ -
June 30, 2006
55
(2) RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS, CONTINUED
B. Explanation of Certain Differences between the Governmental Fund Statement of Revenues, Expenditures and Changes in Fund Balances and the Govern- ment-wide Statement of Activities
Total Internal Reclassifications Statement of
Governmental Net Pension Capital Long-Term Service and Net Assets
Funds Asset Assets5 Liabilities6 Funds7 Eliminations8 Totals
Revenues: Program revenues:
Charges for services $ 8,752,581 — — — 59,698,715 (26,439,480) 42,011,816 Operating grants and contributions — — — — — 4,131,898 4,131,898 Capital grants and contributions 4,300,000 — 19,559,986 — — 3,782,778 27,642,764 Licenses and permits 10,536,677 — — — — (10,536,677) — Fines, forfeitures and penalties 6,177,549 — — — — (6,177,549) —
General revenues: —
Taxes 111,358,106 — — — — 899,770 112,257,876
Intergovernmental 4,213,782 — 3,600,000 — 100,894 (7,914,676) — Investment earnings 7,107,586 — — — 3,174,069 (30,268) 10,251,387 Net change in fair value of investments (448,507) — — — (608,468) — (1,056,975) Gain (loss) on sale of capital assets — — — — 86,031 — 86,031
Miscellaneous 946,446 — — — — — 946,446
Transfers in 230,344 — — — 2,998,709 (3,220,259) 8,794
Total revenues and transfers in 153,174,564 — 23,159,986 — 65,449,950 (45,504,463) 196,280,037 General government 6,468,832 — — — — (2,722,667) 3,746,165
Public safety 72,360,587 — — — — 2,700,575 75,061,162
Public service 15,043,236 — — — — (50,182) 14,993,054
Culture and recreation 35,369,733 — — — — 4,305,813 39,675,546 Debt service:
Interest 1,766,075 — — 24,747 5,409,428 — 7,200,250
Finance charges 4,825 — — — — (4,825) —
Capital outlay 2,140,614 — — — — (2,140,614) —
Internal service fund operating expenses:
Salaries and employee benefits — — — — 14,231,918 (14,231,918) — Maintenance and operation — — — — 18,785,034 (18,785,034) — Insurance premiums, settlements and
provisions — — — — 3,756,137 (3,756,137) —
Depreciation and amortization of net pension asset — 1,247,866 2,740,469 — 8,516,017 (12,504,352) — Amortization of debt issue costs — — — — 349,670 (349,670) —
Transfers out 2,989,915 — — — 230,344 (3,220,259) —
Infrastructure and fine art assets
completed and transferred — — (1,396,987) — — 1,396,987 — Total expenditures/expenses and transfers out 136,143,817 1,247,866 1,343,482 24,747 51,278,548 (49,362,283) 140,676,177 Change in fund balances/net assets 17,030,747 (1,247,866) 21,816,504 (24,747) 14,171,402 3,857,820 55,603,860 Fund balances/net assets, July 1 92,266,626 13,420,437 76,850,155 (33,755,057) 120,418,437 3,463,219 272,663,817 Fund balances/net assets, June 30 $ 109,297,373 12,172,571 98,666,659 (33,779,804) 134,589,839 7,321,039 328,267,677
Infrastructure
June 30, 2006
56
(2) RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS, CONTINUED
5) Costs for the purchase or construction of infra- structure and fine art collection capital assets are reported as capital outlay expenditures in the fund financial statements. However, in the statement of activities, the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense.
Capital outlay $ 2,140,614
Items not capitalized and reclassed 743,627
Infrastructure transferred from
internal service funds 1,396,987
Depreciation expense 2,740,469
Excess of capital outlay expenditures over depreciation expense in the
current period $ 7,021,697
6) Bond issuance costs and original issue discount are expended when incurred in governmental funds, but are deferred and amortized over the
life of the bonds in the statement of activities $ 24,747 7) Internal service funds are used by management
to charge to individual user funds the costs of acquisition, construction, financing, mainten- ance and capital accumulation for the replace- ment of governmental capital assets (except for infrastructure and fine art assets – see #1 above); operations of the City’s computer, reprographics and cable TV operations, the City’s self-insurance programs and its employee benefits. The net revenue of the activities of the internal service funds is reported as governmental activities in
the statement of activities $ 14,171,402
8) Certain reclassifications and eliminations are re- quired to properly state governmental activities in the statement of activities:
– Certain receivables that do not provide cur- rent financial resources are not reported as revenues in the governmental funds:
Property taxes $ 1,816,751
Sales Tax 2,432,377
Interest 83,593
Net reduction in deferred revenue 4,332,721 – Revenues that become available and are re-
cognized in the fund financial statements that relate to prior years are not reported as revenues in the statement of activities:
Property taxes (1,625,689)
Sales taxes (1,723,669)
Interest revenue (113,861)
Net assets, beginning 3,463,219
Net reduction in revenues related to
prior periods —
– The effect of internal service fund activities is eliminated in the statement of activities:
Charges for services (43,153,706)
General government expenditures 3,997,639
Public safety expenditures 23,685,622
Public services expenditures 5,367,148
Culture and recreation expenditures 10,103,297 Net effect of elimination of internal
service fund activities —
– Licenses and permits revenues and fines, for- feitures and penalties revenues are reported as charges for services in program revenues:
Charges for services 16,714,226
Licenses and permits (10,536,677)
Fines, forfeitures and penalties (6,177,549)
Net effect of reclassification of
June 30, 2006
57
(2) RECONCILIATION OF GOVERNMENT-WIDE AND FUND FINANCIAL STATEMENTS, CONTINUED
– Program specific intergovernmental revenues are reported as operating grants and contribu- tions and capital grants and contributions:
Operating grants and contributions $ 2,188,255
Capital grants and contributions 81,884
Intergovernmental revenues (2,270,139)
Net effect of reclassification of certain
program-specific revenues —
– Internal service fund operating expenses and other governmental expenses are reclassified in the major governmental activities classifi- cations:
General government 1,424,556
Public safety 28,059,413
Public service 5,577,926
Culture and recreation 14,565,216
Salaries and employee benefits (14,231,918)
Maintenance and operation (18,785,034)
Insurance premiums and settlements (3,756,137)
Depreciation and amortization (12,854,022)
Net effect of reclassification of internal
service funds operating expenses —
– Operating transfers within governmental activ- ities are eliminated:
Reduction in transfers in (3,220,259)
Reduction in transfers out 3,220,259
Net effect of elimination of transfers
within governmental funds —
– Certain capital outlay expenditures were not capitalized and are reclassified as functional expenses in the statement of activities:
Public services expense 81,884
Culture and recreation expense 661,743
Capital outlay expense (743,627)
Net effect of reclassification of capital
outlay not capitalized —
– Other reclassifications:
Pension contribution that is deferred
and ammortized in the Statement of Activities 2,988,318
Net effect of other reclassifications 2,988,318
Net reclassifications and eliminations $ 7,321,039
(3) STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY