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

E. OTHER ACCOUNTING POLICIES1. For purposes of the statement of cash flows for proprietary funds, the District considers highly liquidinvestments to be cash equivalents if they have a maturity of three months or less when purchased.2. The District reports inventories of supplies at weighted average cost including consumablemaintenance, instructional, office and transportation items. Supplies are recorded as expenditureswhen they are consumed. Inventories of food commodities are recorded at market values supplied bythe Texas Department of Human Services. Although commodities are received at no cost, their fairmarket value is supplied by the Texas Department of Human Services and recorded as inventory anddeferred revenue when received. When requisitioned, inventory and deferred revenue are relieved,expenditures are charged, and revenue is recognized for an equal amount.3. In the government-wide financial statements, and proprietary fund types in the fund financialstatements, long-term debt and other long-term obligations are reported as liabilities in the applicablegovernmental activities, business-type activities, or proprietary fund type statement of net assets. Bondpremiums and discounts, as well as issuance costs, are deferred and amortized over the life of the bondsusing the effective interest method. Bonds payable are reported net of the applicable bond premium ordiscount. Bond issuance costs are reported as deferred charges and amortized over the term of therelated debt.In the fund financial statements, governmental fund types recognize bond premiums and discounts, aswell as bond issuance costs, during the current period. The face amount of debt issued is reported asother financing sources. Premiums received on debt issuances are reported as other financing sourceswhile discounts on debt issuances are reported as other financing uses. Issuance costs, whether or notwithheld from the actual debt proceeds received, are reported as debt service expenditures.4. Capital assets, which include land, buildings, furniture and equipment, are reported in the applicablegovernmental or business-type activities columns in the government-wide financial statements. Capitalassets are defined by the District as assets with an initial, individual cost of more than $5,000 and anestimated useful life in excess of one year. Such assets are recorded at historical cost or estimatedhistorical cost if purchased or constructed. Donated capital assets are recorded at estimated fair marketvalue at the date of donation.The costs of normal maintenance and repairs that do not add to the value of the asset or materiallyextend assets lives are not capitalized. Major outlays for capital assets and improvements arecapitalized as projects are constructed.Buildings, furniture and equipment of the District are depreciated using the straight line method overthe following estimated useful lives:AssetsYearsLand Improvements 20Buildings 50Portable Buildings 20Building Improvements Remaining life of building or 20years whichever is lessFurniture, Fixtures &5-10EquipmentVehicles 8Information Systems5(computer equipment)27