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CITY OF ORONO <br />NOTES TO BASIC FINANCIAL STATEMENTS <br />DECEMBER 31, 2015 <br /> <br /> <br />(31) <br /> <br />NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) <br />E. Fund Financial Statement Presentation (Continued) <br />Description of Funds <br />The City reports the following major governmental funds: <br /> <br />General Fund – This is the general operating fund of the City. It is used to account <br />for all financial resources except those required to be accounted for in another fund. <br /> <br />The City reports the following major enterprise funds: <br /> <br />Water Operating Fund – This fund is used to account for the provision of water <br />services to the residents of the City who have water service available. <br /> <br />Sewer Operating Fund – This fund is used to account for the provision of sewer <br />services to the residents of the City who have sanitary sewer service available. <br /> <br />Storm Water Fund – This fund is used to account for the charges for and the costs <br />of maintaining the City's storm water system. <br /> <br />The City’s proprietary funds also include the following: <br /> <br />Internal Service Funds – Insurance and Compensated Absences – These funds <br />are used to account for the insurance costs incurred by the City for general liability, <br />property, vehicle, workers' compensation, and other insurance and deductibles as <br />well as to account for the accrual of sick and vacation days that are earned by the <br />City’s employees. These funds are reimbursed through charges to the various <br />participating departments of the City. <br /> <br />F. Cash and Investments <br />Cash balances from all funds are combined and invested to the extent available in short- <br />term investments. Earnings from the pooled investments are allocated to the individual <br />funds based on the average monthly cash and investment balances of the respective <br />funds. The City considers all highly liquid debt instruments with an original maturity from <br />the time of purchase by the City of three months or less to be cash equivalents. The <br />proprietary funds' portion in the government-wide cash and investment management <br />pool is considered to be cash equivalent. <br /> <br />Cash and investments held by trustee reflect balances held in segregated accounts for <br />specific purposes. Interest earned on these investments is allocated directly to those <br />accounts. <br /> <br />Short-term highly liquid debt instruments (including commercial paper, bankers' <br />acceptances, and U.S. treasury and agency obligations) purchased with a remaining <br />maturity of one year or less are reported at amortized cost. Other investments are <br />reported at fair value.