2024 Annual Comprehensive Report

The details of this $398,023,623 difference (including Premium of $19,580,880 and bond refunding charges of $3,855,897) are as follows:

General Obligation Bonds

$

304,679,234 (3,855,897) 61,901,647 13,503,428 17,929,999

Deferred Bond Refunding Charges

Limited Obligation Bonds

Lease and Other Financing Agreements Payable

Compensated Absences Payable

Accrued Interest Payable

3,865,212

Combined Adjustment

$

398,023,623

B. Explanation of certain differences between the governmental fund statement of revenues, expenditures, and change in fund balances and the government-wide statement of activities. The governmental fund statement of revenues, expenditures, and changes in fund balances include reconciliation between net changes in fund balances – total governmental funds and changes in net position of governmental activities as reported in the government-wide statement of activities. One element of that reconciliation explains that “Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over their estimated useful lives and reported as depreciation expense”. The details of this $14,165,445 difference are as follows:

Capital Outlay

$

34,390,757

Contributed Capital

79,950 (89,094)

Disposal

Depreciation/Amortization Expense

(20,216,168) 14,165,445

Combined Adjustment

$

Another element of that reconciliation states that “the issuance of long-term debt (e.g., bonds, leases) provides current financial resources to governmental funds, while the repayment of the principal of long-term debt consumes the current financial resources of governmental funds. Neither transaction, however, has any effect on net position. Also, governmental funds report the effect of premiums, discounts, and similar items when debt is first issued, whereas these amounts are unearned and amortized in the statement of activities. Also included are compensated absences activities.” The details of this $22,339,399 difference are as follows:

Issuance of Debt Principal Expenditure

$

(6,011,636) 27,736,192 (383,463) 4,012,970 (984,675) (2,029,989) 22,339,399

Bond-Related Amortization

Interest Expenditures/Premium Amortization

Arbitrage Accrual

Compensated Absences Expense

Combined Adjustment

$

III. Stewardship, Compliance and Accountability A. Budgetary Information

In accordance with the General Statutes of the State of North Carolina, the City prepares and adopts its budgets on the modified accrual basis. The General Statutes also require balanced budgets for all funds for which a budget is required. The City adopts annual budgets for all funds except Capital Projects Funds, Grant Project Funds and Trust Funds. Annual budgets must be adopted no later than July 1, the beginning of the Fiscal Year. The following Special Revenue Funds have legally adopted annual budgets: State Highway Allocation, Cemetery, Hotel/Motel Occupancy Tax, Special Tax Districts, Housing Partnership Revolving, and Emergency Telephone System Fund. Capital and Grant Project budgets are adopted for the duration of the

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