Reso 2011-1770 - Laserfiche WebLink

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FUND BALANCE POLICY CITY OF SUNNY ISLES BEACH Sunny Isles Beach, FL 33160 (305) 947-0606 Effective Date: Se tember 16,2011 Revision Date: Poli '10: DEFINITIONS Fund Balance - As defined by the Governmental Accounting, Auditing and }<lnamial Reporting of the Government Finance Officers Association, fund balance is "The difference between assets and liabilities reported in a governmental fund." Non-Spendable Fund Balance - Amounts that are (a) not in spendable form or (b) legally or contractually required to be maintained intact. "Not in spendable form" includes items that are not expected to be converted to cash (such as inventories and prepaid amounts) and items such as long-term amount of loans and notes receivable, as well as property acquired for resale. The corpus (or principal) of a permanent fund is an example of an amount that is legally or contractually required to be maintained intact. Restricted Fund Balance - Amounts that can be spent only for specific purposes stipulated by (a) external resource providers such as creditors (by debt covenants), grantors, contributors, or laws or regulations of other governments; or (b) imposed by law through constitutional provisions or enabling legislation. Committed Fund Balance - Amounts that can be used only for the specific purposes determined by a formal action (resolution) of the City Commission, the City's highest level of decision making authority. Commitments may be changed or lifted only by the City Commission taking the same formal action (resolution) that imposed the constraint originally. Resources accumulated pursuant to stabilization arrangements sometimes are reported in this category. Assigned Fund Balance - Includes spendable fund balance amounts established by City Manager that are intended to be used for specific purposes that are neither considered restricted or committed. Unassigned Fund Balance - Unassigned fund balance is the residual classification for the general fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the general fund. Unassigned fund balance may also include negative balances for any governmental fund if expenditures exceed amounts restricted, committed, or assigned for those specific purposes. Unrestricted Fund Balance - The total of committed fund balance, assigned fund balance, and unassigned fund balance. Reservations of Fund Balance - Reserves established by City Commission (committed fund balance) or City management (assignedfund balance). PURPOSE The City hereby establishes and will maintain Fund Balance, as defined herein, in accordance with Governmental Accounting and Financial Standards Board Statement No. 54, Fund Balance Reporting and Governmental P'und TYpe Definitions. The objective of GASB 54 is to improve the usefulness, including the understandability, of governmental fund balance information. Beginning fiscal year ending 9/30/2011, Fund Balance shall be composed of non-spendable, restricted, committed, assigned and unassigned amounts. FUND BALANCE POLICY