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CITY OF SAN LEANDRO <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />For The Year Ended June 30, 2022 <br />NOTE 1 – SIGNIFICANT ACCOUNTING POLICIES (Continued) <br />In addition to liabilities, the statement of net position or balance sheets report a separate section for <br />deferred inflows of resources. This separate financial statement element, deferred inflows of resources, <br />represents an acquisition of net assets or fund balance that applies to a future period(s) and so will not be <br />recognized as an inflow of resources (revenue) until that time. <br />N.Use of Estimates <br />The preparation of financial statements in conformity with generally accepted accounting principles <br />requires City management to make estimates and assumptions that affect certain amounts and disclosures. <br />Accordingly, actual results could differ from those estimates. <br />O.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 />P.Property Held for Resale <br />The City purchased property with the intent to resell the property to an income eligible first-time home <br />buyer. During fiscal year ended June 30, 2022, the property was sold. <br />51