Laserfiche WebLink
City of Louisville <br />Notes to the Financial Statements <br />December 31, 2014 <br />Note 1: Summary of significant accounting policies (continued) <br />B. Government -wide and fund financial statements (continued) <br />The Statement of Activities demonstrates the degree to which the direct expenses <br />of a given function or segment is offset by program revenues. Direct expenses are <br />those that are clearly identifiable with a specific function or segment. Program <br />revenues include 1) charges to customers or applicants who purchase, use, or <br />directly benefit from goods, services, or privileges provided by a given function or <br />segment and 2) grants and contributions that are restricted to meeting the <br />operational or capital requirements of a particular function or segment. Taxes and <br />other items not properly included among program revenues are reported instead as <br />general revenues. <br />C. Measurement focus, basis of accounting, and financial statement <br />presentation <br />Separate financial statements are provided for governmental funds and proprietary <br />funds. Major individual governmental funds and major individual enterprise funds <br />are reported as separate columns in the fund financial statements. <br />The government -wide financial statements are reported using the economic <br />resources measurement focus and the accrual basis of accounting, as are the <br />proprietary fund financial statements. Revenues are recorded when earned, and <br />expenses are recorded when a liability is incurred, regardless of the timing of <br />related cash flows. Property taxes are recognized as revenues in the year for <br />which they are levied. Grants and similar items are recognized as revenue as <br />soon as all eligibility requirements imposed by the provider have been met. <br />Governmental fund financial statements are reported using the current financial <br />resources measurement focus and the modified accrual basis of accounting. <br />Revenues are recognized as soon as they are both measurable and available. <br />Revenues are considered to be available when they are collected within the current <br />period or soon enough thereafter to pay liabilities of the current period. For this <br />purpose, the City considers revenues to be available if they are collected within 60 <br />days of the end of the current fiscal period. Expenditures generally are recorded <br />when a liability is incurred, as under accrual accounting. However, debt service <br />expenditures are recorded only when payment is due. <br />Property taxes, sales and use taxes, franchise taxes, lodging taxes, and interest <br />associated with the current fiscal period are all considered to be susceptible to <br />accrual and have been recognized as revenues of the current fiscal period. Most <br />other revenue items are considered to be measurable and available only when the <br />City receives cash. <br />The City reports the following major governmental funds: <br />The General Fund is the City's primary operating fund. It is used to account <br />for most of the day-to-day operations of the City, which are financed from <br />sales taxes, property taxes, and other general revenues. Activities financed <br />by the General Fund include those of line and staff departments within the <br />City, except for activities of the enterprise funds. <br />41 <br />