Annual Report 2012 - Kansas City International Airport

City of Kansas City, Missouri Department of AviationNotes to Financial StatementsApril 30, 2012 and 2011Note 1:Nature of Operations and Summary of Significant Accounting PoliciesNature of OperationsThe Kansas City Airports Fund (the Fund) is a fund of and owned by the City of Kansas City,Missouri (the City). The Fund is utilized to account for the operations of the City’s two airports,the Kansas City International Airport (MCI) and the Charles B. Wheeler Downtown Airport(MKC). The financial statements present only the Fund and are not intended to present thefinancial position of the City and the changes in its financial position and cash flows for the yearsended, in conformity with U.S. generally accepted accounting principles.Basis of Accounting and PresentationThe City accounts for the Fund as a proprietary enterprise fund. The accompanying financialstatements are prepared on the accrual basis of accounting, wherein revenues are recorded whenearned and expenses are recorded when incurred. The Fund first applies restricted net assets whenan expense or outlay is incurred for purposes for which both restricted and unrestricted net assetsare available.The Fund prepares its financial statements as a business-type activity in conformity with applicablepronouncements of the Governmental Accounting Standards Board (GASB). The Fund has theoption to apply all Financial Accounting Standards Board (FASB) pronouncements that wereissued after November 30, 1989, unless the FASB pronouncement conflicts with or contradicts aGASB pronouncement. The Fund applies all relevant pronouncements of the Financial AccountingStandards Board (FASB) issued on or before November 30, 1989, unless they conflict with orcontradict GASB guidance.Use of EstimatesThe preparation of financial statements in conformity with accounting principles generally accepted inthe United States of America requires management to make estimates and assumptions that affect thereported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dateof the financial statements and the reported amounts of revenues, expenses and other changes in netassets during the reporting period. Actual results could differ from those estimates.Cash EquivalentsThe Fund’s cash and cash equivalents are cash on hand, demand deposits and short-terminvestments with original maturities of three months or less from date of acquisition.InvestmentsThe Fund’s investments are maintained in the City’s pooled investments. All investments arereported at fair value. The fair value of marketable securities is based on quotations that aregenerally obtained from national securities exchanges. Where marketable securities are not listedon an exchange, quotations are obtained from brokerage firms or pricing services.A-22