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I <br /> TOWN OF MASHPEE, MASSACHUSETTS <br /> NOTES TO FINANCIAL STATEMENTS <br /> JUNE 30, 1987 <br /> * Nonexpendable Trust Funds - are used to account for trusts where <br /> the principal must remain intact. Generally, income earned on <br /> nonexpendable trust principal may be expended in accordance with the <br /> conditions of the trust. Nonexpendable trust funds are accounted for in <br /> essentially the same manner as proprietary funds. <br /> * Pension Trust Funds - are used to account for those funds held <br /> in trust for disbursement to participating employees. Pension Trust <br /> Funds are accounted for essentially in the same manner as proprietary <br /> funds. <br /> 3) Account Groups. Account Groups are used to establish accounting <br /> control and accountability for the town's general fixed assets, the unmatured <br /> principal of it's general long-term debt and other long term obligations that relate <br /> to the governmental funds. The accounts groups maintained by the town are as follows: <br /> * General Long Term-Debt Account Group - is used to account for <br /> long-term obligations of the governmental funds (except for special <br /> assessment funds) . <br /> C. Basis of Accounting <br /> Basis of accounting refers to when revenues, expenditures, expenses, and <br /> transfers are recognized in the accounts and reported in the financial statements. <br /> The modified accrual basis of accounting is followed in governmental funds <br /> and expendable trust funds. Revenues are recognized in the accounting period in <br /> which they become measurable and available to finance expenditures of the <br /> current period. . "Available" is defined as collectible within the current period <br /> or soon thereafter to be used to pay current liabilities. Expenditures are <br /> recognized when the related liability is incurred, except for unmatured interest <br /> 15 <br />