RIO GRANDE CITY CISD ANNUAL FINANCIAL REPORT ... - rgccisd

EXHIBIT C-4RIO GRANDE CITY CISDRECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF REVENUES, EXPENDITURES,AND CHANGES IN FUND BALANCES TO THE STATEMENT OF ACTIVITIESFOR THE YEAR ENDED AUGUST 31, 2012Total Net Change in Fund Balances - Governmental FundsThe District uses internal service funds to charge the costs of certain activities, such asself-insurance and printing, to appropriate functions in other funds. The net income(loss) of internal service funds are reported with governmental activities. The net effectof this consolidation is to increase (decrease) net assets.$(395,225)72,029Current year capital outlays and long-term debt principal payments are expenditures inthe fund financial statements, but they should be shown as increases in capital assets andreductions in long-term debt in the government-wide financial statements. The net effectof removing the 2012 capital outlays and debt principal payments is to increase(decrease) net assets.Depreciation is not recognized as an expense in governmental funds since it does notrequire the use of current financial resources. The net effect of the current year'sdepreciation is to decrease net assets.8,031,945(5,510,575)Various other reclassifications and eliminations are necessary to convert from themodified accrual basis of accounting to accrual basis of accounting. These includerecognizing deferred revenue as revenue, adjusting current year revenue to show therevenue earned from the current year's tax levy, eliminating interfund transactions,reclassifying the proceeds of bond sales, and recognizing the liabilities associated withmaturing long-term debt and interest. The net effect of these reclassifications andrecognitions is to increase (decrease) net assets.Change in Net Assets of Governmental Activities$278,9282,477,102The notes to the financial statements are an integral part of this statement.17