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CITY OF ORONO, MINNESOTA <br />Notes to Financial Statements (continued) <br />December 31,1998 <br />NOTE 1 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) <br />1. Governmental Fund Types <br />a. General Fund - The General Fund is the general operating fund of the City. It is used to <br />account for all financial resources except those required to be accounted for in another fund. <br />b. Special Revenue Funds - The Special Revenue Funds are used to account for the proceeds of <br />specific revenue sources (other than expendable trusts or major capital projects) that are <br />restricted to expenditures for specified purposes. <br />c. Debt Service Funds - The Debt Service Funds are used to account for the accumulation of <br />resources for, and the payment of, bonded general long-term debt principal, interest, and related <br />costs. <br />d. Capital Project Funds - The Capital Project Funds are used to account for financial resources <br />to be used for the acquisition or construction of major capital facilities (other than those <br />financed by Proprietary Funds). <br />2. Proprietary Fund Type <br />a. Enterprise Funds - The Enterprise Funds are used to account for operations that are financed <br />and operated in a manner similar to private business enterprises - here the intent of the <br />governing body is that the costs of providing goods or services to the general public on a <br />continuing basis be financed or recovered primarily through user charges. <br />3. Fiduciary Fund Type <br />a. Expendable Trust Fund - The Expendable Trust Fund is used to account for assets held by the <br />City in a trustee capacity. The Expendable Trust Fund includes the City ’s flexible benefit plan <br />(Internal Revenue Code § 125). <br />4. Account Groups <br />a. General Fixed Assets - This separate account group contains the fixed assets of the <br />governmental fund types. <br />b. General Long-Term Debt - This account group contains the long-term obligations of the City, <br />other than those liabilities included in the Proprietary Funds. <br />D. Measurement Focus and Basis of Accounting <br />The accounting and financial reporting treatment applied to a fund is determined by its measurement focus <br />and its basis of accounting. <br />-27- <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I <br />I