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<br />CITY OF LA PORTE, TEXAS <br />Reconciliation of the Statement of Revenues, Expenditures and <br />Changes in Fund Balances of Governmental Funds to the <br />Statement of Activities <br />For The Year Ended September 30,2006 <br /> <br />Amounts reported for governmental activities in the statement of activities are <br />different because: <br /> <br />Net change in fund balances-total governmental funds: <br /> <br />Governmental funds report outlays for capital assets as expenditures because <br />such outlays use current financial resources. In contrast, the statement of <br />activities reports only a portion of the outlay as expense. The outlay is allocated <br />over the assets' estimated useful lives as depreciation expense for the period. <br />This is the amount by which capital outlays $8,393,314 exceeded depreciation <br />$2,310,704 and losses from the disposition of capital assets in the current period. <br /> <br />Governmental funds do not present revenues that are not available to pay <br />current obligations. In contrast, such revenues are reported in the statement <br />of activities when earned. <br /> <br />Governmental funds report bond proceeds as current financial resources. In <br />contrast, the statement of activities treats such issuance of debt as a liability. <br />Governmental funds report repayment of bond principal as an expenditure. In <br />contrast, the statement of activities treats such repayments as a reduction in <br />long-term liabilities. This is the amount by which proceeds exceeded <br />repayments. <br /> <br />Some expenses reported in the statement of activities do not require the use of <br />current financial resources and these are not reported as expenditures in <br />governmental funds: <br />Accrued interest not reflected in governmental funds <br />Additional compensated absences not reflected in governmental funds <br /> <br />Internal service funds are used by management to charge the costs of certain <br />activities, such as fleet maintenance and information technology, to individual <br />funds. The net revenue (expense) of the internal service funds is reported with <br />governmental activities. <br /> <br />Change in net assets of governmental activities <br /> <br />See accompanying notes to basic financial statements. <br /> <br />36 <br /> <br />$ 5,119,402 <br /> <br />(942,409) <br /> <br />246,841 <br /> <br />(5,768,649) <br /> <br />(38,129) <br />59,199 <br /> <br />1,077,387 <br /> <br />$ <br /> <br />(246,358) <br />