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CITY OF RAMSEY, MINNESOTA <br />NOTES TO FINANCIAL STATEMENTS <br />December 31, 1993 <br />Note 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) <br />C. Basis of Statement Presentation (continued) <br />b) Special Revenue Funds - The Special Revenue Funds are used to <br />account for the proceeds of specific revenue sources (other than <br />major capital projects) that are legally restricted to expenditures <br />for specified purposes. They are also used to finance specified <br />activities as required by law or administrative regulation. <br />c) Debt Service Funds - The Debt Service Funds are used to account <br />for the accumulation of resources for, and the payment of, general <br />long -term debt principal, interest, and related costs. <br />d) Capital Project Funds - The Capital Project Funds are used to <br />account for financial resources to be used for the acquisition or <br />construction of major capital facilities (other than those financed <br />by Proprietary Funds). <br />2) Proprietary Fund ype <br />a) Enterprise Funds - The Enterprise Funds are used to account for <br />operations that are financed and operated in a manner similar to <br />private business enterprises - -where the intent of the governing <br />body is that the costs of providing goods or services to the <br />general public on a continuing basis be financed or recovered <br />primarily through user charges. <br />3) Fiduciary Fund Type <br />a) Expendable Trusts and Agency Funds - The Expendable Trust and <br />Agency Funds are used to account for assets held by the City in the <br />capacity of trustee or agent. <br />4) Account Groups <br />a) General Fixed Asses - The General Fixed Assets Account Group is <br />used to account for fixed assets acquired by the City's <br />governmental fund types. <br />b) General Long -Term Debt - The general long -term debt group of <br />accounts contains the long -term liabilities of the City, other than <br />those liabilities included in the Proprietary Funds. <br />D Measurement Focus and Basis of Accounting <br />The accounting and financial reporting treatment applied to a fund is <br />determined by its measurement focus and its basis of accounting. <br />Measurement Focus <br />The measurement focus of a fund determines what the fund measures. All <br />governmental and expendable trust funds are accounted for using a current <br />financial resources measurement focus. With this measurement focus, only <br />current assets and current liabilities generally are included on the balance <br />sheet. Operating statements of these funds present increases (revenue and <br />-13- <br />