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..., , . . :. .ST ATEME.NT OF N.ET ASSETS A.1W STATEMENT OF ACTr~ITIES.. The Statement: of Net .Assets and the: Statement" of Activities are statements required by Governmental Accounting.StancmrdsBoard Statement No. 34. Their purpose.. is to summarize the. entire City's financial: : ., activities, and financial. position. . They are prepared on the. same. basis as is. used by, most. businesses,.. which means they:include. all: the City's assets and~:all)ts.::liabilities, .as well as. all its revenues and expen~e.s. This is known as the. full accrual,,basis of accounting .- the. effe~t of all the City's transactions . is taken into account, \ regardless ..'of whether or when cash: changes. hands\ but .allmaterial internal:' :transactions between. City: funds have been el1minated. ' The. Stateme~t .of Net Assets. r~ro;"th~ differencebet~een the:citis tota11 :a~sets' ~nd.the CitY's'tot:a:J.. ;'liabilities, iticluciing all the :City's capital" assets .and alUts long-term debt. .The Statement of Net Assets. .: . presents. similar 'information to. the. o~d balance. sheet fomiat; 'but presen~ it.in a way that focuses the re~der on the composition of the City's.ilerassets, by subtracting :totalliabilitiesfrom .!otal.assets. The StatementufN~t Assets summ~zes the financial pQsition :~f.theCity~~;:govemmentaI ~ctivities ina.. single' c6lumn~ and, the. financial' position of all :City business:"'type,..activities in a.. single ~olumn; these colum.Its are followed by a total column that presents the finimcial.position of; the entire City.. . ,.,. . The .c"ity's griveIll~entaI activitie"s inClu.de the ,ictivities of its. general:. fwlCl, alon'g ~.ith all .its special ,revenue, capital projects 'aitddeht servlcefunds.. Since'the City's internal. servicefuncis service these .:funds, their activities:. are. consolidated with goverrirri~tal. : activities, :: .after eliminating mter-fund trarisactjon~ and:balan.ces. The City's business~iypeactivjtles include all its enterprise [\lnd activities. :. The Statement ofActiviti~~ rcports'incr~a~s ~nd decr~ases in. the City'~ n~t ass~ts. .It is also. prepared on. ... the full accrua1.basis,.iwhich means it includes all.the ,City's rev~ues and.'aU its e~enseSt 'regarqless of ; when;"cash. cbanges~. hands~... This differs .from. the "rnotlified. accrual':- .~asis used; in. the fUnd financial.. statements,. which : reflect: .oilly . current. assets,.. current . liabilities,: avallabl~ revenues. and measurable . expenditures. . . . ., , . , , .:The.[~rmat of the, Statement of Ac#viti,~ differs!co~siderably fr~in .those. used in the past. Itpresents the .jeity's expenses first, .listed by.program, and;follows these. with. the: expenses 'of. its business-type. activities. I;7ogram:revenues ~ that is,' revenues whicq are~.generated direct~y. by these 'programs. - are . then deducted from program expenses to arrive at the net expense .of each, governmental and business~ . type activity. The Gity"s .ge~.eral.revenues are then listed in the governmental activities or busine~s-tyPe ..Jactivities. columi1,~s appropriate; .and the: Change in. Net AsseJs. is computed 'and reconciled : with the . .Statei1.1ent ofNeiAssets. ' . . ,. : Both, these .statements i11:clu.de. the n~anc.ial ~tjviii'es. of th.eCity and: the; Redevelopmen.t. Agency of the. . .. City of Redwood.City.,: whiCh is legally separate . but is ii. component.unit .of the City because ,it is :,' controlled:by the City~ which ~sfina.l1cially ac_countable for::the Agencyrsactivitie.s.: . .'. .. . .... . . : .! .... ;The~e: fin.ancial statements.:al~l1g",with: the fundj'i~ancial statements .and...footnote~ a~e called Basic. . ;iFinancial Statements; the term General Purpose FinanciaLStatemenfisno lo~ger used. 1.5 .. .. .., .. . .~ ..