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( i <br /> Expendable Trust Funds are accounted for in essentially the same <br /> manner as governmental funds. Nonexpendable Trust Funds are <br /> accounted for in a manner that permits the periodic measurement of <br /> revenues earned, expenses incurred, and/or net income in order to <br /> demonstrate maintenance of capital. Agency Funds are custodial in <br /> nature (assets equal liabilities) and do not involve measurement of results <br /> of operations. <br /> ACCOUNT GROUP <br /> Long-Term Debt and Liabilities - Long-term liabilities expected to be fin- <br /> anced from governmental funds are accumulated in the General Long- <br /> Term Debt Group of Accounts. This account group is not a fund. It is <br /> only concerned with the measurement of financial position and, therefore, <br /> is not involved with a measurement of the results from any operations. <br /> B. Basis of Accounting <br /> The Town's Nonexpendable Trust Funds are accounted for using the <br /> accrual basis of accounting. All other Town funds have been prepared <br /> using the modified accrual basis of accounting. This method recognizes <br /> revenues when they become measurable and available. Property taxes, <br /> motor vehicle excise, and certain intergovernmental revenues are the <br /> significant revenue sources considered susceptible to accrual. The Town <br /> accrues as revenue the amount of property taxes due to the Town and <br /> collected within sixty days after the end of its fiscal year. All other <br /> revenues are recognized when cash is received. <br /> i <br /> Expenditures are generally recognized under the modified accrual basis <br /> of accounting when obligations are incurred. The significant exceptions <br /> to this general rule include interest on long-term debt, accumulated vaca- <br /> tion, sick pay and other employee benefits which are considered expendi- <br /> tures when paid. <br /> Nonexpendable Trust Funds are accounted for 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. <br /> i <br /> C. Budgetary Basis <br /> The General Fund appropriation appearing on page 5 of the financial f <br /> statements has been calculated as follows: <br /> � I <br /> 7 <br />