121 / 373
38m
outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated
useful lives and reported as depreciation expense”.
The details of this $5,798,496 difference are as follows:
Capital Outlay
19,468,966
$
Contributed Capital
17,725
Disposal
(1,204,250)
Depreciation/Amortization Expense
(12,483,945)
Combined Adjustment
5,798,496
$
Another element of that reconciliation states that “the issuance of long-term debt (e.g., bonds, leases) provides current
financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current
financial resources of 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
unearned and amortized in the statement of activities. Also included are OPEB and compensated absences activities.”
The details of this $(7,175,974) difference are as follows:
Issuance of Debt
(18,444,962)
$
Principal Expenditure
12,850,663
Bond-Related Amortization
(255,128)
Interest Expenditures/PremiumAmortization
1,750,106
Compensated Absences Expense
(89,411)
OPEB Expense
(2,987,242)
Combined Adjustment
(7,175,974)
$
III. Stewardship, Compliance and Accountability
A. Budgetary Information
In accordance with the General Statutes of the State of North Carolina, the City prepares and adopts its budgets on the
modified accrual basis. The General Statutes also require balanced budgets for all funds for which a budget is required. The
City adopts annual budgets for all funds except Capital Projects Funds, Grant Project Funds and Trust Fund. Annual budgets
must be adopted no later than July 1, the beginning of the Fiscal Year. The following Special Revenue Funds have legally
adopted annual budgets: Streets and Sidewalk Revolving, Cemetery, Hotel/Motel Occupancy Tax, Special Tax Districts,
Housing Partnership Revolving, Economic Development Fund, and Emergency Telephone System Fund. Capital and Grant
Project budgets are adopted for the duration of the project which may encompass several years. Appropriations for funds that
adopt annual budgets lapse at the end of the budget year. Capital and Grant Project budget appropriations do not lapse until
the completion of the project.
The following schedule provides management and citizens with information on the portion of General Fund balance that is
available for appropriation:
Total Fund Balance - General Fund
$77,173,159
Less:
Inventories
1,003,078
Prepaid Expenditures
197,660
Stabilization by State Statute
28,002,098
Police Separation Allowance
6,365,576
Appropriated Fund Balance in 2017 Budget
6,654,740
Capital Projects
10,149,567
Working Capital/Fund Balance Policy
24,800,440