2018 CAFR - Laserfiche WebLink

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NOTE 1— SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) The City has elected higher deductibles through LMCIT in order to keep premiums at a minimum. To supplement the commercial coverages, the City established the Self -Insurance Internal Service Fund. This fund is funded primarily through dividend paybacks from LMCIT. Expenses from this fund consist solely of payments of those insurance related costs that are below the individual and/or commutative deductible amounts. Premiums for LMCIT policies are not paid from the Self -Insurance Internal Service Fund, but rather are budgeted and paid from the respective operating funds. The City does not retain significant uncovered risk. The City also carries commercial insurance for certain other risks of loss. Settled claims resulting from these risks have not exceeded commercial insurance coverage in any of the past three fiscal years. There were no significant reductions in the City's insurance coverage in 2018. V. Loans payable to Met Council The City entered into a loan agreement with the Metropolitan (Met) Council to acquire property within the proposed right-of-way of highways designated as a part of the metropolitan highway system plan. State Highway 10, within Ramsey, is part of that highway system plan. The loans bear no interest, and are to be repaid upon the acquisition of the property by the State of Minnesota. W. Use of Estimates The preparation of financial statements, in accordance with accounting principles generally accepted in the United States of America, requires management to make estimates that affect amounts reported in the financial statements during the reporting period. Actual results could differ from such estimates. X. Change of Accounting Principle During the 2018 fiscal year, the City implemented GASB Statement No. 75, Accounting and Financial Reporting_ for Postemployment Benefits Other Than Pensions. This statement establishes new standards for employer recognition and measurement of liabilities, deferred outflows/inflows of resources, and expense for OPEB. This standard requires retroactive implementation. However, the cumulative net effect of this change in accounting principle was not material to these financial statements, and was therefore included in current year activity. NOTE 2 — DEPOSITS AND INVESTMENTS A. Components of Cash and Investments Cash and investments at year-end consist of the following: Deposits $ 8,425,149 Investments 70,682,312 Cash on hand 200 Total $ 79,107,661 Cash and investments are presented in the financial statements as follows: Cash and temporary investments - Statement of Net P osition Cash and temporary investments - Statement of Fiduciary Net P osition Total 75,394,150 3,713,511 79,107,661 70