2023 Annual Comprehensive Report

Capital assets also include certain right to use assets. These right to use assets arise in association with agreements where the City reports a lease (only applies when the City is the lessee) or agreements where the City reports an Information Technology (IT) Subscription. The right to use lease assets are initially measured at an amount equal to the initial measurement of the related lease liability plus any lease payments made prior to the lease term, less lease incentives, and plus ancillary charges necessary to place the lease into service. The right to use lease assets are amortized on a straight-line basis over the life of the related lease. The right to use IT subscription assets are initially measured at an amount equal to the initial measurement of the subscription liability plus any subscription payments made at the start of the subscription term, if applicable, plus capitalizable initial implementation costs at the start of the subscription term, less any incentives received from the IT subscription vendor at the start of the subscription term. Subscription payments, as well as payments for capitalizable implementation costs made before the start of the subscription term should be reported as a prepayment (asset). Such prepayments should be reduced by any incentives received from the same vendor before the start of the subscription term if a right of offset exists. The right to use subscription assets are amortized on a straight-line basis over the subscription term. Intangible Assets of $94,746,402 as of June 30, 2023 are recorded in the Water Resources Enterprise Fund and represent rights to future raw water allocations from the Randleman Dam and reservoir project, in accordance with a joint venture agreement established in September 1987 with five other governmental entities to form a regional water supply. The intangible asset is based on City contributions to the Piedmont Triad Regional Water Authority for construction of the dam, reservoir, water treatment plant and surrounding infrastructure improvements as well as $962,945 of contributions recorded in Fiscal Year 2023, toward the City’s administrative and operating allocation. In Fiscal Year 2011, the City began amortizing the water rights over a period of 50 years with current year related amortization expense totaling $1,894,928. Accumulated amortization totals $23,199,807. Property and equipment of the Greensboro ABC Board are stated at cost and are depreciated over their useful lives on a straight line basis as follows: Buildings, 50 years; Equipment, 3-5 years. Leasehold improvements of the Greensboro ABC Board are depreciated over the term of the lease agreement. Property, furniture and equipment of the GHDP are stated at cost and are depreciated over their useful lives on a straight-line basis as follows: Buildings, 27 years; Furniture and Equipment, 3-5 years. 7. Deferred Outflows/Inflows of Resources and Unearned Revenues In addition to assets, the statement of financial position will sometimes report a separate section for deferred outflows of resources. This separate statement of net position, Deferred Outflows of Resources , represents a consumption of net assets that applies to a future period and so will not be recognized as an expense or expenditure until then. The City has several items that meet this criterion, an unamortized loss on bond defeasance for General Obligation and Water and Sewer Refunding bonds and pension and OPEB deferrals. In addition to liabilities, the statement of financial position will sometimes report a separate section for deferred inflows of resources. This separate financial statement element, Deferred Inflows of Resources, represents an acquisition of net assets that applies to a future period and so will not be recognized as revenue until then. The City has certain items that meet the criterion for this category – prepaid taxes, prepaid assessments, deferrals of pension expense, leases and deferrals of Other Post Employment Benefit expense. In addition, revenue related to property tax, notes, and other accounts receivable that does not meet the availability criterion are reported in deferred inflows of resources in the governmental fund financial statements. The City reports unearned revenue on its government-wide and fund financial statements. Deferred Inflows for Grants arise when potential revenue does not meet both the “measureable” and “available” criteria for recognition in the current period (fund financial statements). Unearned revenues arise when resources are unearned by the City and received before it has a legal claim to them. In subsequent periods, when both revenue recognition criteria are met, or when the City has a legal claim to the resources, the liability for unearned revenue is removed from the applicable financial statement and revenue is recognized.

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