Agenda - Council - 06/25/2002 - Laserfiche WebLink

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I I I I I ! I I I I I I ,I I I ! I I I Malloy stated the sewer utility enterprise fund is in a similar healthy condition. He stated the streetlight fund is also in good financial condition and the recycling fund has a small, fund balance and profit for each year. Mr. Malloy noted the accounting and auditing updates and pointed out that at year end 2004, the City's financial report will need to include the City's depreciation and debt, and more information for management and analysis of the City's operations. He stated GASB will place a burden on the financial staff and commented on the need to support staff as that conversion takes place. Councilmember Zimmerman asked if the replacement costs are contained in a separate statement. Mr, Malloy explained that the fixed assets will be recorded like a commercial entity with historical costs and depreciation. Councilmember Zimmerman asked if replacements will also be included. Mr. Malloy stated that replacement costs will be included. Mayor Gamec asked when GASB will take affect. Mr. Malloy stated in 2004 it must be totally implemented but what typically happens is that you need to get all starting balances as of January 1, 2004 to capture the revenue/expenditure information. Mayor Gamec stated he attended a meeting with AMM where this issue was discussed. He noted that many cities are starting implementation now so employees are educated about the needed changes. Mr. Malloy stated the infrastructure area will be a challenge as well as for cities that have implementation staged for different years. However, cities can implement GASB earlier if they want. Mayor Gamec asked Finance Director Lund to provide a recommendation on when this will be implemented, time involved, and staffing needs. Chairperson Hendriksen stated several years ago Ramsey's financial controls did not include the use of purchase orders. He asked if that was unusual in a city. Mr. Malloy stated it is not unusual if there are other controls. He noted that cities are controlled by budget and departmental strUctures so purchase orders are sometimes not as effective. He stated that the larger the organization of a city, the more appropriate the use of purchase orders may be. Chairperson Hendriksen stated he thought purchase orders would be useful in tracking information on a purchase or expenditure. Finance Committee/June I1, 2002 Page 3 of 5