07-1784 Comprehensive Annual Financial Report (CAFR) - FY 2006

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CITY OF CASSELBERRY, FLORIDA MANAGEMENT'S DISCUSSION AND ANAL YSIS - Continued September 30, 2006 transportation, human services, and culture/recreation. The business-type activities of the City include solid waste disposal and water and sewer utilities. The government-wide financial statements can be found immediately following the MD&A. Fund financial statements A fund is a grouping of related accounts thai is used to maintain control over resources that have been segregated for specific activities or objectives. The City, like other slate and local governments, uses fund accounting to ensure and demonstrate compliance with finance-related legal requirements. All of the funds of the City can be divided into three categories: governmental funds, proprietary funds, and fiduciary funds. Governmental funds Governmental funds are used to account for essentially the same functions reported as governmental activities in the government-wide financial statements. However, unlike the government-wide financial statements, governmental fund financial statements focus on near-term inflows and outflows of spendable resources, as well as on balances of spendable resources available at the end of the fiscal year. Such information may be useful in evaluating a government's near-term financing requirements. Because the focus of governmental funds is narrower than that of the government-wide financial stafements, it is useful to compare the information presented for governmental funds with similar information presented for governmental activities in the government-wide financial statements. By doing so, readers may better understand the long-term impact of the government's near-term financing decisions. Both the governmental fund balance sheet and the governmental fund statement of revenues, expenditures, and changes in fund balances provide a reconciliation to facilitate this comparison between governmental funds and governmental activities. The City maintains several individual governmental funds. Information is presented separately in the governmental funds balance sheet and in the governmental funds statement of revenues, expenditures, and changes in fund balances for the General Fund, the Local Option Gas Tax SpeCial Revenue Fund, and the Infrastructure Surtax Special Revenue Fund, which are considered to be major funds. Data from the other governmental funds are combined into a single, aggregated presentation. Individual fund data for each of these nonmajor governmental funds is provided in the form of combining statements in the other supplemental information section of this report. The City adopts an annual appropriated budgel for its genera' and special revenue funds, and project- length budgets for the capital projects funds. Budgetary comparison schedules have been provided for these funds to demonslrate budgetary compliance. The basic governmental fund financial statements may be found immediately following the government- wide financial statements_ Proprietary funds The City maintains two different types of proprietary funds. The enterprise fund is used to report Ihe same functions presented as business-type activities in the government-wide financial statements. The City uses an enterprise fund to account for the fiscal activities relating to water and wastewater utilities. The internal service fund is an accounting device used to accumulate and allocate costs internally among the City's various functions. The City uses the internal service fund to account for catastrophic loss reserves related to its self-insurance and risk management program. Because these reserves predominantly benefit governmental rather than business-type functions, they have been included within governmental activities in the government-wide financial statements. 4