11-18-09 Meeting of the La Porte Redevelopment Authority Minutes

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1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Assets. Liabilities and Net Assets or Eauitv (Continued) Fund Equity In the fund financial statements, governmental funds report reservations of fund balance for amounts that are not available for appropriation or are legally restricted by outside parties for use for a specific purpose. Designations of fund balance represent tentative management plans that are subject to change. As of September 30,2009, the Authority does not have reservations or designations of fund balance. Net Assets Net assets represent the difference between assets and liabilities. Net assets are reported as restricted when there are limitations imposed on their use either through the enabling legislations adopted by the Authority or through external restrictions imposed by creditors or laws or regulations of other governments. Estimates The preparation of financial statements, in conformity with generally accepted accounting principles, requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual amounts could differ from those estimates. 2. STEWARDSHIP AND ACCOUNTABILITY Buduetarv Information Expenditures exceeded appropriations by $1,199,213. This overrun was covered with existing fund balance and unexpected revenues. Deficit Net Assets A net asset deficit of $516,726 exists as of September 30,2009. This deficit is the result of the Authority borrowing money from the City of La Porte to finance capital improvements. As of September 30, 2009, the amount outstanding that was used to finance construction of assets was $615,026. 9