Agenda - Council - 06/12/2018 - Laserfiche WebLink

Home

CITY OF RAMSEY Notes to Basic Financial Statements December 31, 2017 NOTE 1— SIGNIFICANT ACCOUNTING POLICIES A. Organization The City of Ramsey, Minnesota (the City) operates under the Home Rule Charter City form of government as defined in Minnesota Statutes. Under this plan, the government of the City is run by a City Council composed of an elected Mayor and elected Councilmembers. The City Council exercises legislative authority and determines all matters of policy. The accounting policies of the City conform to accounting principles generally accepted in the United States of America as applicable to governmental units. The accounting policies of the City conform to accounting principles generally accepted in the United States of America as applicable to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard -setting body for establishing governmental accounting and financial reporting principles. B. Reporting Entity As required by accounting principles generally accepted in the United States of America, these financial statements include the City (the primary government) and its component units. Component units are legally separate entities for which the primary government is financially accountable, or for which the exclusion of the component unit would render the financial statements of the primary government misleading. The criteria used to determine if the primary government is financially accountable for a component unit include whether or not the primary government appoints the voting majority of the potential component unit's Board, is able to impose its will on the potential component unit, is in a relationship of financial benefit or burden with the potential component unit, or is fiscally depended upon by the potential component unit. 1. Blended Component Units The City has one component unit - the Ramsey Economic Development Authority (EDA). The EDA is considered a component unit of the City (primary government) because voting authority rests with the City Council and the City is in a relationship of financial benefit or burden with the entity. The financial position and results of operations of the EDA component unit is presented using the blended method. This blended component unit, although a legally separate entity, is, in substance part of the City's operations. The component unit consists of a Nonmajor Special Revenue Fund using the modified accrual basis of accounting, and as such is included in the other governmental funds. Separate financial statements for the EDA are not prepared. 2. Jointly Governed Organization The City is a member of Local Governmental Information Systems (LOGIS), a consortium of Minnesota municipalities that provides data processing services and support to its members. LOGIS is a legally separate entity that is financially independent of the City. Further, the City does not appoint a voting majority of LOGIS' Board of Directors. Therefore, it has not been incorporated into the City's reporting entity. During the 2017 fiscal year, the City paid LOGIS approximately $181,050 for services and equipment provided. 63