AgdaPkt 2014-01-13 Interview, Closed and Regular

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7.1.G. - Page 35 Management's Discussion and Analysis For the year ended June 30, 2013 Proprietary funds are maintained in two ways. Enterprise funds are used to report the same functions presented as business -type activities in the government -wide financial statements. The City uses enterprise funds to account for water, sewer, parking, Port, and Docktown Marina operations. Internal services funds are used to account for costs of the City's equipment services, the City's insurance program, the costs of the City's telephone /communications and information technology services, maintenance and repair of buildings, custodial services, and employee benefits. Because these services predominantly benefit governmental rather than business -type functions, they have been included within governmental activities in the government -wide financial statements. The proprietary fund financial statements may be found on pages 29 -31 of this report. Since the City's internal service funds provide goods and services only to the City's governmental and business -type activities, their activities are reported only in total at the fund level. Internal service funds may not be major funds because their revenues are derived from other City funds. These revenues are eliminated in the City -wide financial statements and any related profits or losses are returned to the activities which created them, along with any residual net assets of the internal service funds. Comparisons of budget and actual financial information are presented only for the general fund and other major funds that are special revenue funds. As the Housing Legal Aid Society Fund was created after the dissolution of the Redevelopment Agency and is currently under litigation, there is no adopted budget for this fund. Fiduciary Funds The City maintains fiduciary funds that consist of a Private Purpose Trust Fund and Agency Funds. The Private Purpose Trust Fund accounts for the activity of the former Redevelopment Agency of Redwood City, while the Agency Funds account for tax free employee and employer contributions made under the provisions of section 125 of the Internal Revenue Code (cafeteria benefits fund), and for transactions involving the Pacific Shores Community Facilities District, the Shores Transportation Improvement District, and the One Marina Community Facilities District. The City's fiduciary activities are reported in the separate Statement of Fiduciary Net Position, Statement of Changes in Fiduciary Net Position, and the Agency Funds Statement of Changes in Assets and Liabilities. The accounting used for fiduciary funds is much like that used for proprietary funds. These activities are excluded from the City's other financial statements because the City cannot use these assets to finance its own operations. The fiduciary fund financial statements may be found on pages 32 -33 of this report. Notes to the Financial Statements Notes to the Financial Statements provide additional information that is essential to a full understanding of the data provided in the government -wide and fund financial statements. The Notes to the Financial Statements may be found on pages 34 -75 of this report. GOVERNMENT -WIDE FINANCIAL ANALYSIS As noted earlier, net position may over time serve as a useful indicator of the City's financial position. The City's assets exceeded liabilities by $476.2 million at June 30, 2013. 7