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City of Redwood City <br />Notes to the Basic Financial Statements (Continued) <br />For the Year Ended June 30, 2025 <br /> <br /> <br />75 <br />Note 1 – Summary of Significant Accounting Policies (Continued) <br /> <br />V. Upcoming Government Accounting Standards Implementations <br /> <br />The City is currently analyzing its accounting practices to determine the potential impact on the financial statements <br />for the following GASB statements: <br /> <br />GASB Statement No. 103 – In April 2024, GASB issued Statement No. 103, Financial Reporting Model <br />Improvements. The objective of this Statement is to improve key components of the financial reporting model <br />to enhance its effectiveness in providing information that is essential for decision making and assessing a <br />government’s accountability. Application of this statement is effective for the City’s fiscal year ending <br />June 30, 2026. <br /> <br />GASB Statement No. 104 – In September 2024, GASB issued Statement No. 104, Disclosure of Certain Capital <br />Assets. This Statement requires certain types of capital assets to be disclosed separately in the capital assets <br />note disclosures required by Statement 34. Lease assets recognized in accordance with Statement No. 87, <br />Leases, and intangible right-to-use assets recognized in accordance with Statement No. 94, Public-Private and <br />Public-Public Partnerships and Availability Payment Arrangements, should be disclosed separately by major <br />class of underlying asset in the capital assets note disclosures. Subscription assets recognized in accordance <br />with Statement No. 96, Subscription-Based Information Technology Arrangements, also should be separately <br />disclosed. In addition, this Statement requires intangible assets other than those three types to be disclosed <br />separately by major class. Application of this statement is effective for the City’s fiscal year ending <br />June 30, 2026. <br /> <br />GASB Statement No. 105 – In December 2025, GASB issued Statement No. 105, Subsequent Events. This <br />Statement establishes accounting and financial reporting requirements for events and transactions that occur <br />after the financial statement date but before financial statements are issued. The Statement defines the types of <br />subsequent events and requires disclosure of certain nonrecognized subsequent events. Application of this <br />Statement is effective for the City’s fiscal year ending June 30, 2027. <br /> <br />W. Reclassification of Governmental Function Categories <br /> <br />Description of the Change <br /> <br />Effective with the fiscal year ended June 30, 2025, the City reclassified the presentation of governmental expenses <br />and program revenues in the government-wide Statement of Activities and the Governmental Fund financial <br />statements. The purpose of the reclassification was to conform the City’s function-level reporting to the uniform <br />classification system prescribed by the California State Controller’s Office (SCO) in its City Financial Transactions <br />Report (FTR) instructions (California Government Code §12463, §53891) consistent with GASB Statement No. <br />34. <br /> <br />This change in presentation does not constitute a change in accounting principle under GASB Statement No. 100. <br />It represents a reclassification of expenses between function categories with no effect on total governmental <br />expenses, total revenues, fund balances, or net position. Beginning fund balances and net position are not restated <br />as a result of this change. <br />7.C. - Page 107 of 269 <br />126