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CITY OF SAN LEANDRO <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />For The Year Ended June 30, 2018 <br />I NOTE 1 -SIGNIFICANT ACCOUNTING POLICIES (Continued) <br />N. Fair Value Measurements <br />Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an <br />orderly transaction between market participants at the measurement date. The City categorizes its fair <br />value measurements within the fair value hierarchy established by generally accepted accounting <br />principles. The fair value hierarchy categorizes the inputs to valuation techniques used to measure fair <br />value into three levels based on the extent to which inputs used in measuring fair value are observable in <br />the market. <br />Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. <br />Level 2 inputs are inputs -other than quoted prices included within level 1 that are observable for <br />an asset or liability, either directly or indirectly. <br />Level 3 inputs are unobservable inputs for an asset or liability. <br />If the fair value of an asset or liability is measured using inputs from more than one level of the fair value <br />hierarchy, the measurement is considered to be based on the lowest priority level input that is significant <br />to the entire measurement. <br />0. Implementation of New Governmental Accounting Standards Board (GASB) Pronouncements <br />Management adopted the provisions of the following Governmental Accounting Standards Board <br />(GASB) Statements which became effective during the year ended June 30, 2018. <br />GASB Statement No. 75 -In June 2015, GASB issued Statement No. 75, Accounting and Financial <br />Reporting for Postemployment Benefits Other Than Pensions. Statement 75 establishes new accounting <br />and financial reporting requirements for governments whose employees are provided with OPEB, as well <br />as for certain nonemployer governments that have a legal obligation to provide financial support for <br />OPEB provided to the employees of other entities. The provisions in statement 75 are effective for fiscal <br />years beginning after June 15, 2017. The City implemented this statement in current year. See additional <br />information in Notes 9E and 14. <br />GASB Statement No. 81 -In March 2016, the GASB issued Statement No. 81, Irrevocable Split-Interest <br />Agreements. The objective of this Statement is to improve accounting and financial reporting for <br />irrevocable split-interest agreements by providing recognition and measurement guidance for situations in <br />which a government is a beneficiary of the agreement. This Statement requires that a government that <br />receives resources pursuant to an irrevocable split-interest agreement recognize assets, liabilities, and <br />deferred inflows of resources at the inception of the agreement. Furthermore, this Statement requires that <br />a government recognize assets representing its beneficial interests in irrevocable split-interest agreements <br />that are administered by a third party, if the government controls the present service capacity of the <br />beneficial interests. This Statement requires that a government recognize revenue when the resources <br />become applicable to the reporting period. The requirements of this Statement are effective for financial <br />statements for periods beginning after December 15, 2016 and should be applied retroactively. This <br />statement had no impact on the City's financial statements. <br />51 516