2025 Annual Comprehensive Financial Report

CITY OF SHAKOPEE

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIES - GOVERNMENTAL FUNDS

For the Year Ended December 31, 2025

Net Change in Fund Balances - Governmental Funds

$ (1,256,038)

Amounts reported for governmental activities in the Statement of Activities are different because:

Capital outlays are reported in governmental funds as expenditures. However, in the Statement of Activities, the cost of those assets is allocated over the estimated useful lives as depreciation expense.

Capital Outlays

11,789,721 (7,544,157) (264,434) 7,576,099

Depreciation Expense

Loss on Disposal of Capital Assets

Contributed Assets Lease Equipment

273,059

Amortization Expense on Leases

(148,735)

SBITA Equipment

46,540

Amortization Expense on SBITA Equipment

(51,929)

The issuance of long term debt provides current financial resources to governmental funds, while the repayment of principal of long term debt consumes the current financial resources of the governmental funds. Neither transaction, however has any effect on net position. Also, governmental funds report the effect of premiums, discounts and similar items when debt is first issued, whereas these amounts are deferred and amortized in the statement of activities. The amounts below are the effects of these differences in the treatment of long-term debt

Principal Payments on Debt

2,585,000 (273,059)

Leases

Principal Payments on Leases

158,166 33,407 48,551 169,616

Principal Payments on Subscription Payable

Net Adjustment to Interest Payable Amortization of Bond Premium

Certain revenues in the Statement of Activities that do not provide current financial resources are not reported as revenues in the funds.

Special Assessments Delinquent Special Assessments Deferred

(206,026)

53,901

Intergovernmental

1,242,488

Delinquent receivables will be collected this year, but are not available soon enough to pay for the current period's expenditures and, therefore, are not revenues in the funds.

72,905

The reduction of some expenses reported in the statement of activities do not require the use of current financial resources and, therefore, are not reported as expenditures in governmental funds.

Pension Expense OPEB Obligations

1,252,815 (137,321)

Internal service funds are used by management to charge the costs of certain activities such as buildings, equipment, park assets and employee benefits to individual funds. (See Note 2.B.)

2,466,326

Change in Net Position - Governmental Activities

$ 17,886,895

The Notes to the Financial Statements are an integral part of this statement.

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