Years Ended 1991 & 1990 Financial Statements

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1: ~• I• LOWER RUM RIVER WATER MANAGEMENT ORGANIZATION NOTES TO FINANCIAL STATEMENTS ~ Note 1. Nature of the Organization The Organization is a watershed management organization which has been created to fulfill the requirements and purposes of Minnesota ~ Statutes 473.875 to 473.883. The purpose of such an organization as-defined by Minnesota Statute 473.875 is to; "protect, preserve and use natural surface and ground water storage and tetention systems in order to (a) reduce to the greatest practical extent the public capital expenditures necessary to control excessive volumes - and rates of runoff, (b) protect and improve surface and ground water quality, (c) prevent flooding and erosion from surface ~ flows, (d) promote ground water recharge, (e) protect and enhance fish and wildlife habitat and water recreational facilities, and (f) secure the other benefits associated with the proper management of surface and ground water." The cities of Anoka, Andover, Coon Rapids and Ramsey formed the ~ Organization by executing a joint powers agreement in accordance with Minnesota Statute 473.877 dated July 15, 1985. Note 2. Summarv of siQnificant accountinQ policies ~ The accompanying summary of significant accounting policies is presented to assist the reader in understanding the Organization's financial statements. The financial statements are representations of the Organization's management which is responsible for their integrity and objectivity. ~ Cash equivalents - for purposes of the statement of cash flows, the Organization considers all highly liquid investments with a maturity of three months or less when purchased to be "cash equivalents". Income taxes - As a joint powers watershed management organization, the Organization is exempt from both Federal and Minnesota income taxes. Accordingly, no provision for income taxes is included in these financial statements. -5-