The following terms shall apply to this chapter as written unless context indicates or requires a different meaning:
ASSIGNED FUND BALANCE: | The assigned fund balance is the portion of the spendable fund balance that reflects funds intended to be used by the government for specific purposes assigned by more informal operational plans (e.g., capital goods replacement, the constraint on use is not imposed by external parties or by formal Board action). In governmental funds other than the General Fund (e.g., Special Revenue Funds, Capital Project Funds, Debt Service Funds and permanent funds), assigned fund balance represents the amount that is not restricted or limited. The authority to "assign" fund balance is delegated to the Village Treasurer and Village Administrator; the Village Board shall approve same prior to any final action being taken on the Village's Audited Financial Statements and Annual Treasurer's Report for the given fiscal year. |
CAPITAL GOODS REPLACEMENT: | At the end of each fiscal year, the Village Treasurer and Village Administrator will report "assigned" fund balance for equipment replacement according to the Village Capital Improvement Plan. The Village Board shall approve same prior to any final action being taken on the Village's Audited Financial Statements and Annual Treasurer's Report for the given fiscal year. |
CASH FLOW: | A. At the end of each fiscal year, the village will maintain spendable unassigned portions of the fund balance for cash flow in a range equal to 25-50% of the General Fund operating expenditures. In addition to the cash flow needs, this accommodates emergency contingency concerns. B. In the event that amounts designated for cash flow fall above or below the desired range, the Treasurer shall report such amounts to the Board of Trustees as soon as practical after the end of the fiscal year. Should the actual amount designated for cash flow fall below the desired range, the Village shall create a plan to restore the appropriate levels. Should the actual amount designated for cash flow rise above the desired range, any excess funds will remain undesignated pending the Board's final decision concerning transfer to another fund. It is the policy of the Village that such excess funds will be, by Board action, reported in the spendable limited category of this Policy. |
COMMITTED FUND BALANCE: | A. The committed fund balance classification includes the portion of the spendable fund balance that reflects constraints that the village has imposed upon itself by a formal action of the Board of Trustees (for example, an ordinance or resolution passed by the Board of Trustees). This constraint must be imposed prior to year-end, but the amount can be determined at a later date. B. Policy: Prior to the end of each fiscal year, the Village will report "committed" fund balance for long-term loan receivables, such as advances to other funds and similar accounts, including the Wadsworth Farmer's Market checking account. |
FUND BALANCE: | Fund balance is the difference between assets and liabilities in governmental funds (i.e., general fund, special revenue funds, capital project funds, debt service funds and permanent funds). |
NON-SPENDABLE FUND BALANCE: | A. Describes the amount of a fund balance that cannot be spent because it is either not in spendable form or there is a legal or contractual requirement for the funds to remain intact. B. Policy: At the end of each fiscal year, the Village will report the portion of the fund balance that is not in spendable form as Non-Spendable Fund Balance on the financial statements. |
RESTRICTED FUND BALANCE: | A. The restricted fund balance category includes the portion of the spendable fund balance that reflects constraints on spending because of legal restrictions stipulated by outside parties (e.g., encumbrances for goods or services with outside parties, creditors, grantors, outstanding at the end of the year); also, any legal restrictions based on state statutes or grant requirements placed on the use for specific purposes. |
B. Policy: At the end of each fiscal year, the Village will report "restricted" fund balance for amounts that have applicable legal restrictions per GASB #54. In addition, encumbrances or funds restricted by enabling legislation will be reported as "restricted." | |
SPENDABLE FUND BALANCE (OVERVIEW): | A. Describes the amount of fund balance that is available for appropriation based on the constraints that control how specific amounts can be spent. Typically, a significant portion of a government's spendable resources can be spent only for specified purposes. The following categories define the revenue source and the level of force of the constraint on spending. B. Categories should be supported by actual plans approved by either the governing body, an appropriate officer, grant providers or enabling legislation. |
UNASSIGNED: | This is the residual classification for the government's General Fund and includes all spendable amounts not contained in the other classifications and, therefore, not subject to any constraints. Unassigned amounts are available for any purpose. These are the current resources available for which there are no governmental self-imposed limitations or set spending plan. Although there is generally no set spending plan for the undesignated portion, there is a need to maintain a certain funding level. Undesignated fund balance is commonly used for emergency expenditures not previously considered. In addition, the resources classified as undesignated can be used to cover expenditures for revenues not yet received. (Ord. 2020-1088, 7-7-2020) |