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i <br /> i <br /> Expendable Trust Funds are accounted for in essentially the same <br /> manner as governmental funds. Agency funds are custodial in nature <br /> (assets equal liabilities) and do not involve measurement of results <br /> of operations. <br /> i <br /> ACCOUNT GROUP <br /> i <br /> Long-Term Debt and Liabilities - Long-term liabilities effected to be <br /> financed from governmental funds are accumulated in the General Long- <br /> Term Debt Grote of Accounts. This account group is not a fund. It j <br /> is only concerned with the measurement of financial position, and <br /> iA <br /> therefore is not involved with a measurement of the results from any <br /> operations. <br /> B. Basis of Acc:ountiM <br /> All the Town' � <br /> Tom-'s funds (except nonele trust funds which are <br /> accounted for on an accrual basis) have been prepared using the <br /> modified accrual basis of accounting. This method recognizes <br /> revenues when they become measureable and available. Property taxes, <br /> motor vehicle excise and certain intergovernmental revenues are the <br /> significant revenue sources considered susceptible to accrual. The <br /> Town elected to accrue tax revenue for the sixty day period <br /> subsequent to year end. All other revenues are recognized when cash <br /> is received. <br /> Expenditures are generally recognized under the modified accrual j <br /> basis of accounting when obligations are incurred. The significant j <br /> exceptions to this general rule include interest on long-term debt, <br /> accumulated vacation, sick pay and other employee benefits which are <br /> considered expenditures when paid. <br /> The Nonexpendable Trust has been prepared using the accrual basis of <br /> accounting. Their revenues are recognized when they are earned and <br /> their expenses are recognized when they are incurred. However, <br /> interest on long-term debt and accrued employee benefits are again <br /> considered expenditures when paid. <br /> C. Budget Reauixement <br /> At the town meeting, the Finance Committee presents an operating and j <br /> capital budget for the proposed expenditures of the fiscal year <br />�\ commencing the following July first. The budget, as enacted by the j <br /> town meeting, also establishes that certain appropriations are to be <br /> } <br /> funded by particular revenues. The original budget is amended during I. <br /> the fiscal year at special town meetings as required by changing <br /> 4. <br /> conditions. In cases of extraordinary or unforeseen expenses, the <br /> Finance Committee is empowered to transfer funds from the Reserve <br /> Fund to a departmental appropriation. "Extraordinary" includes <br /> expenses which are not in the usual line, or are great, or <br /> exceptional. "Unforeseen" includes expenses which are not foreseen <br /> as of the time of the annual meeting when appropriations are voted. <br /> i <br /> _.. - 9 - <br />