CAFR 2016

Budgets are adopted at a fund level and are amended as necessary during the Fiscal Year in one of two ways. First, the City Manager, as delegated by City Council, may make line-item transfers within individual fund budgets with subsequent monthly notice to City Council. Such transfers can neither increase nor decrease the overall budget at the fund level. Secondly, the budget may be increased or decreased at the fund level as changing circumstances dictate, subject to City Council approval. The legal level of budgetary control (the level at which expenditures may not legally exceed appropriations) is the fund level. As required by North Carolina General Statutes, appropriations in Governmental Funds are encumbered upon issuance of purchase orders, contracts or other forms of legal commitments. Even though goods and services have not been received, the transactions are accounted for as a reservation of fund balance in the year that the commitment is made. While appropriations lapse at the end of the Fiscal Year, the succeeding year’s budget ordinance specifically provides for the re- appropriation of year-end encumbrances. The outstanding encumbrances are amounts needed to pay any commitments related to purchase orders and contracts that remain unperformed at year-end are as follows:

Encumbrances

General Fund Debt Service Fund Non-Major Funds

$

53,561,673

$

3,674,807

$

2,700

$

49,884,166

Supplemental budgetary amendments increased the General Fund appropriation by $2,080,432 for programs being funded by state grants and appropriated fund balance. No expenditures exceeded appropriations at the legal level of control during Fiscal Year 2016. B. Deficit Fund Equity The following funds report deficit fund balances as of June 30, 2016:

State Highway Allocation Fund Workforce Investment Act

$

(51,933) (5,581) (30,303) (525,517) (56,082) (4,163,815)

Stimulus Grants Project Fund (ARRA) Street and Sidewalk Capital Project Fund Parks and Recreation Bond Fund - Series 2008 Street Improvement Bond Fund - Series 2010 Parks and Recreation Bond Fund - Series 2010

(36,792)

These deficits will be eliminated with future reimbursements of federal and state grants and with proceeds from future bond issuances. IV. Detailed Notes on all Funds A. Deposits and Investments 1. Deposits All deposits of the City of Greensboro are either insured or collateralized by using one of the two methods. Under the Dedicated Method, all deposits that exceed the federal depository insurance coverage level are collateralized with securities held by the City’s agents in the City’s name. Under the Pooling Method, which is a collateral pool, all uninsured deposits are collateralized with securities held by the State Treasurer’s agent in the name of the State Treasurer. Since the State Treasurer is acting in a fiduciary capacity for the City, the deposits are considered to be held by the City’s agent in the City’s name. The amount of the pledged collateral is based on an approved averaging method for non-interest bearing deposits and the actual current balance for interest-bearing deposits. Depositories using the Pooling Method report to the State Treasurer the adequacy of their pooled collateral covering uninsured deposits. The State Treasurer does not confirm this information with the City or the escrow agent. Because of the inability to measure the exact amount of collateral pledged for the City under the Pooling Method, the potential exists for under collateralization, and the risk may increase in periods of high cash flows. However, the State Treasurer of North Carolina enforces strict standards of financial stability for each depository that

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