Turbina

funds, the unassigned classification is used only to report a deficit balance resulting from overspending for specific proposes for which amounts had been restricted, committed, or assigned.

The City applies restricted resources first when expenditures are incurred for purposes for which either restricted or unrestricted (committed, assigned, and unassigned) amounts are available. Similarly, within unrestricted fund balance, committed amounts are reduced first, followed by assigned, and then by unassigned amounts when expenditures are incurred for purposes for which amounts in any of the unrestricted fund balance classifications could be used.

11. Statements of Cash Flows - The Statements of Cash Flows contains all highly liquid investments (including restricted assets) with original maturities of 90 days or less when purchased are considered to be cash equivalents. Under the provisions of GASB Statement No. 9 the Fiduciary Funds are not required to present a Statement of Cash Flows.

12. Use of Estimates - The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements, and the reported amounts of revenues and expenditures during the reporting period. Actual results could differ from those estimates.

13. Minimum Fund Balance Policy - The General Fund reserve target is 20% of the current year budgeted appropriations. For the purpose of determining if the target has been met, the unassigned fund balance of the General Fund is then compared with the annual appropriations budget.

14. Program Revenues - Amounts reported as program revenues include: 1) charges to customers

or applicants for goods, services, or privileges provided; 2) operating grants and contributions; and 3) capital grants and contributions. Internally dedicated resources are reported as general revenues rather than as program revenues. Likewise, general revenues include all taxes. Proprietary funds distinguish operating revenues and expenses from non-operating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with a proprietary fund’s principal ongoing operations. The principal operating revenues of the water and wastewater utility funds, the solid waste system fund, the parking facilities fund, the golf courses fund, and all of the City’s internal service funds are charges to customers for sales and services.

CITY OF TAMPA, FLORIDA

NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2013

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

The Water and Wastewater Utility Funds also recognize as operating revenue the portion of tap fees intended to recover the cost of connecting new customers to the system. Operating expenses for enterprise funds and internal service funds include the cost of sales and services, administrative expenses (including administrative overhead), and depreciation on capital assets. All revenues and expenses not meeting this definition are reported as non-operating revenues and expenses. When both restricted and unrestricted resources are available for use, it is the City’s policy to use restricted resources first, then unrestricted resources as they are needed.

15. Adoption of New Governmental Accounting Standards Board (GASB) Pronouncements

During the fiscal year ended September 30, 2013, the City implemented the following GASB Pronouncements:

GASB Statement No. 60, Accounting and Financial Reporting for Service Concession Arrangements issued November 2010, the objective of this statement is to improve financial

reporting by addressing issues related to service concession arrangements (SCAs), which are a type of public-private or public-public partnership. The requirements of this Statement establish recognition, measurement and disclosure requirements for SCAs for transferor and governmental operators, requiring governments to account for and report SCAs in the same manner, which improves the comparability of financial statements.

Management has evaluated existing contracts, leases, and other agreements to determine if they are in fact a SCA and if the criteria outlined in the statement for a SCA have been met. The City does not have any agreements which require accounting and reporting under GASB Statement No. 60. On an annual basis, management will evaluate new lease agreements and other arrangements in accordance with the criteria in the Statement.

GASB Statement No. 61, The Financial Reporting Entity: Omnibus, an Amendment of GASB Statements No. 14 and No. 34. Issued November 2010, the objective of this statement is

to improve financial reporting for a governmental financial reporting entity and amends Statement No. 14, The Financial Reporting Entity, and Statement No. 34, Basic Financial Statements and Management’s Discussion and Analysis (MD&A) for State and Local Governments. The requirements of GASB Statement No. 61 result in making financial statements more relevant by improving guidance for including, presenting, and disclosing information about component units and equity interest transactions of a financial reporting entity.

CITY OF TAMPA, FLORIDA

NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2013

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued)

Management reviewed the financial reporting criteria in GASB Statement No. 61 to identify any potential additional component units and determine if existing component units required changes to the accounting, reporting or disclosures. Management’s analysis did not identify other reportable component units that were material to include or disclose in the CAFR and no accounting and reporting changes are needed for any of the existing component units.

GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements. Issued December 2010, the objective of this statement is to improve financial reporting by contributing to the GASB’s efforts to codify all sources of generally accepted accounting principles for state and local governments, so the standards can be derived from a single source. This effort brings the authoritative accounting and financial reporting literature together in one place, with that guidance modified as necessary to appropriately recognize the governmental environment and the needs of governmental financial statement users. It will effectively eliminate the need for financial statement preparers and auditors to determine private sector standards issued prior to December 1, 1989, that need to be applied, thereby resulting in a more consistent application of applicable guidance in financial statements of state and local Governments. This statement is effective for the fiscal year ended September 30, 2013.

GASB Statement No. 62, in paragraphs 173-187, added guidance on interest costs imputation to its codification; low interest loans issues by government to carry out governmental objectives are not excluded.

GASB Statement No 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position. Issued June 2011, the objective of this statement is to improve financial reporting by standardizing the presentation of deferred outflows of resources and deferred inflows of resources and their effects on a government’s net position. The statement provides reporting guidance for financial statement line items and the actual financial statement presentation and disclosure of these financial statement elements. This statement is effective for the fiscal year ended September 30, 2013.

Management has reviewed requirement of this standard and has determined the impact to the City’s financial reporting is to rename the former Statement of Net Assets to the Statement of Net Position and change related references throughout the CAFR. In addition, the former line item for “Invested in Capital Assets, Net of Related Debt” will change to “Net Investment in Capital Assets” in statements reporting Net Position.

Deferred outflows of resources are defined as a consumption of net assets that is applicable to a future reporting period, and they have a positive effect on net position, similar to assets. Deferred inflows of resources are defined as an acquisition of net assets that is applicable to a future reporting period, and they have a negative effect on net position, similar to liabilities. For the fiscal year ended September 30, 2013, the City does not have Deferred Outflows or Inflows of Resources.

CITY OF TAMPA, FLORIDA

NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2013

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued)

16. Future GASB Pronouncements

The following GASB pronouncements have been issued, but are not in effect for the City as of September 30, 2013:

GASB Statement No 65, Items Previously Reported as Assets and Liabilities. Issued in March 2012, the objective of this statement is to evaluate and reclassify various financial statement items that have been previously reported as either assets or liabilities and evaluates them against the definitions provided for deferred outflows and deferred inflows of resources. This statement will be effective for fiscal year ending September 30, 2014, and the estimated financial impact will be $4,864,567. Management has reviewed the requirements of this standard and has determined the impact to the City’s financial reporting is to recognize inflows of resources that relate to future period’s deferred inflows of resources. These resources are comprised of unavailable revenue liens and taxes as further described in GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources and Net Position. The City does not currently have Deferred Outflows of Resources.

GASB Statement No. 66, Technical Corrections – 2012, an Amendment of GASB

Statements No. 10 and No. 62. Issued March 2012, this statement improves accounting and

financial reporting by resolving conflicting guidance that could diminish the consistency of financial reporting and thereby enhance the usefulness of the financial reports. The objectives of this statement are to resolve conflicting guidance on risk financing, accounting for operating leases with scheduled rent increases, sales and pledges of receivables and future revenues for acquisition of a loan or group of loans, and recognition of serving fees related to mortgage loans sold. This statement is effective for fiscal year ending September 30, 2014.

Management has determined that the City currently complies with the new guidance in GASB Statement No. 66 in regards to risk financing. Management has also determined that it complies with the guidance on accounting for operating leases. The City does not engage in purchasing loans or selling mortgages and retaining the servicing fees at present, so this portion of the standard does not apply. Management has reviewed the criteria identified in the statements and determined there is no impact to the city’s current financial accounting and reporting for these types of transactions.

GASB Statement No. 67, Financial Reporting for Pension Plans. Issued June 2012, this statement makes significant changes to accounting by pension plans by replacing the requirements of GASB Statement No. 25 Financial Reporting for Defined Benefit Pension Plans and Note Disclosures for Defined Contribution Plans, and GASB Statement No. 50, Pension Disclosures. GASB Statement No. 67 will be effective for the City fiscal year ending September

CITY OF TAMPA, FLORIDA

NOTES TO THE FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2013

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - (Continued)

GASB Statement No. 69, Government Combinations and Disposals of Government

Operations, an amendment of GASB Statement No. 25 and 27. Issued January 2013, this

statement establishes accounting and financial reporting standards related to government combinations and disposals of government operation. GASB Statement No. 69 will be effective for the City, fiscal ending September 30, 2014.

GASB Statement No. 70, Accounting and Financial Reporting for Nonexchange Financial Guarantees. Issued April 2013, this statement requires a government that extends a

nonexchange financial guarantee to recognize a liability when qualitative factors and historical data, if any, indicates that it is more likely than not that the government will be required to make a payment on the guarantee. The requirements of this statement will enhance comparability of financial statement among governments, as well as enhancing the information disclosed about the obligations and risk exposure from extending nonexchange financial guarantees. GASB Statement No. 70 will be effective for the City fiscal year ending September 30, 2014.

GASB Statement No. 71, Pension Transition for Contributions Made Subsequent to the Measurement Date--an Amendment to GASB Statement No. 68. Issued in November, 2013,

this statement relates to contributions made to a defined benefit pension plan after the measurement date of the government’s beginning net pension liability. The City will implement this Statement for the fiscal year ending September 30, 2015.

The City of Tampa will implement new GASB pronouncements no later than the required effective date. Management is currently evaluating whether the above listed new GASB pronouncements will have a significant financial impact to the City’s financial statements