8G Consent 2011 0620 - Laserfiche WebLink

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GASB 54 Fund Balance Components 2 June 20, 2011 intro three separate components: Reserved, Designated and Undesignated. There are almost always important limitations on the purpose for which all or a portion of the resources of a fund can be used. The force of these limitations can vary significantly, depending on their source. The various components of the new fund balance reporting standard are designed to indicate the extent to which the City is bound by these limitations placed upon the resources. GASB Statement No.54 defines five new components of fund balance that will replace the current existing three components. The five new components are: Nonspendable Fund Balance. That portion of a fund balance that includes an amount that cannot be spent because it is either (a) not in a spendable form, such as prepaid items, inventories of supplies, or loan receivable; or (b) legally not contractually required to be maintained intact, such as property acquired for resale. This category was traditionally reported as a "reserve" fund balance under the old standard. Restricted Fund Balance. That portion of a fund balance that reflects constraints placed on the use of resources (other than nonspendable items) that are either (a) extremely imposed by creditors (such as through debt covenants), grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation. This category was traditionally reported as "reserve" fund balance under the old standard. Committed Fund Balance. That portion of a fund balance that includes amounts that can only be used for specific purpose pursuant to constraints imposed by formal action of the government's highest level of decision making authority, and remain binding unless removed in the same manner. This category was traditionally reported as a "designated" fund balance under the old standard. Assi.ned Fund Balance. That portion of a fund balance includes amounts that are constrained by the government's intent to be used for specific purposes but that are neither restricted nor committed. Such intent needs to be established at either the highest level of decision making, or by a body (such as a finance committee) or an official to which the governing body has delegated the authority to assign amounts to be used for specific purposes. This category was traditionally reported as a "designated" fund balance under the old standard. Unassigned Fund Balance. That portion of a fund balance that includes amounts that have not been restricted, committed or assigned to specific purposes within the General Fund. The General Fund is the only fund that should report this category in the fund balance. This category was traditionally reported as "undesignated" fund balance under the old standard.