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Town of Palisade, Colorado <br /> NOTES TO FINANCIAL STATEMENTS <br /> December 31, 2009 <br /> NOTE A—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED <br /> Separate financial statements are provided for governmental funds,proprietary funds and fiduciary funds, <br /> even though the latter are excluded from the government-wide financial statements. Major individual <br /> governmental funds and major individual enterprise funds are reported as separate columns in the fund <br /> financial statements. <br /> 4. Measurement Focus, Basis of Accounting and Financial Statement Presentation <br /> The government-wide financial statements are reported using the economic resources measurement focus <br /> and the accrual basis of accounting, as are the proprietary fund and fiduciary fund financial statements. <br /> Revenues are recorded when earned and expenses are recorded when a liability is incurred, regardless of <br /> the timing of the related cash flows. Property taxes are recognized as revenues in the year for which they <br /> are levied. Grants and similar items are recognized as revenues as soon as eligibility requirements <br /> imposed by the provider have been met. <br /> Governmental fund financial statements are reported using the current financial resources measurement <br /> focus and the modified accrual basis of accounting. Revenues are recognized as soon as they are both <br /> measurable and available. Revenues are considered to be available when they are collectible within the <br /> current period or soon enough thereafter to pay liabilities of the current period. For this purpose the <br /> Town considers revenues to be available if they are collected within 60 days of the end of the current <br /> fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual <br /> accounting, however, debt service expenditures, as well as expenditures related to compensated absences <br /> and claims and judgments, are recorded only when payment is due. <br /> Property taxes, franchise taxes and interest associated with the current period are all considered to be <br /> rsusceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the <br /> portion of special assessments receivable due within the current fiscal period is considered to be <br /> susceptible to accrual as revenue of the current period. All other revenue items are considered to be <br /> measurable and available only when the cash is received by the government. <br /> The government reports the following major governmental funds: <br /> The General Fund is the Town's operating fund. It accounts for all financial resources of the government <br /> except for those required to be reported in another fund. <br /> The government reports the following major proprietary funds: <br /> The Water Fund accounts for the water treatment and distribution system. <br /> Additionally, the government reports the following non-major fund types: <br /> The Tourism Special Revenue Fund accounts for lodging tax received and used for tourism based <br /> marketing of the Town. <br /> The Pension Trust Fund accounts for Police and Fire defined benefit pension plans administered by the <br /> Colorado Fire and Police Association. <br /> The Utility Fund accounts for the sewage treatment and collection system and refuse collection. <br /> I <br /> -21- <br />