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FUND BALANCE POLICY <br />CITY OF NEW BRIGHTON <br />Adopted: �o f 2 (0 2012 <br />POLICY <br />The City of New Brighton has a fiduciary responsibility to its citizens and taxpayers to carefully <br />account for public funds, to manage its finances prudently and to adequately plan the financing <br />of City services including the provision and maintenance of public facilities and infrastructure. <br />The City is also responsible for its short-term and long-term financial stability. The City must <br />ensure that it is, and will continue to be, capable of adequately funding and providing City <br />services needed by the community. <br />Governmental funds report the difference between their assets and liabilities as fund balance <br />Fund balance is one method used to measure the availability of financial resources in a <br />governmental fund. It is essential that the City maintain adequate levels of fund balance to <br />mitigate current and future risks, such as revenue shortfalls, unanticipated expenditures and <br />emergencies, and to ensure stable tax rates, service levels and adequate cash flows. Fund <br />balance levels are a crucial consideration in long-term financial planning. <br />This policy supersedes the previous policy adopted May 10, 2005. <br />I. SCOPE <br />.s fiscal policy provides the framework for the overall fiscal management of the fund balances <br />the City's governmental funds. Governmental funds include the general fund, special <br />enue funds, debt service funds, and capital project funds. Enterprise funds and internal <br />vice funds are not within the scope of this policy since they are not governmental funds. <br />PURPOSE <br />rmation provided; (2) formalize stabilization -like arrangements by establishing targeted <br />'or minimum fund balances; and (3) define and integrate the City's fund balance policy for its <br />ernmental funds to be in compliance with generally accepted accounting principles (GAAP) <br />Governmental Accounting Standards Board (GASB) Statement No. 54, Fund Balance <br />orting and Governmental Fund Type Definitions. <br /># 54 sets out new standards of accounting and financial reporting that are intended to <br />re the clarity and consistency of the fund balance information provided to financial report <br />It is designed to improve this information by providing clearer, more structured fund <br />e classifications, and by clarifying the definitions of existing fund types. <br />Page 1 of 6 <br />