ACFR - FY2021 FINAL 5-13-22 USE THIS ONE - Flipbook - Page 74
NOTES TO FINANCIAL STATEMENTS
CITY OF EUSTIS, FLORIDA
(Continued)
Note 2 - Stewardship, Compliance, and Accountability (Continued)
Budgetary Requirements
The following procedures were used to establish the budgetary data reflected in the
financial statements:
1) By August of each year, the City Manager submits to the City Commission a proposed
operating budget for the fiscal year commencing the following October 1.
2) Two public hearings were held to obtain taxpayer comments.
3) Before October 1, the budget is legally enacted through a resolution.
4) Budgets are legally adopted, and formal budgetary integration is employed as a
management control device during the year for the General Fund, all Special Revenue
funds, and the pension trust funds. The budget adopted for the Enterprise fund is
derived in compliance with debt covenants.
5) Budgets for the governmental funds are adopted consistent with generally accepted
accounting principles (GAAP). The budget for the enterprise fund is adopted on a nonGAAP basis to reflect the budget versus actual information related to “operations and
maintenance” as defined in bond covenants.
6) The City Commission must approve any revisions that alter the total appropriations of
any fund. The classification detail at which expenditures may not legally exceed
appropriations is at the total fund level. During the fiscal year ended, various
appropriations were approved by this policy. Budgeted amounts shown in the financial
statements are adopted and can be amended. However, amendments were nominal
and did not significantly change the originally adopted budget.
In addition to the legal requirements discussed above, the Commission has adopted
management control and approval guidelines for expenditures and budget amendments.
Critical components of these management guidelines are as follows:
1) The City Commission must approve transfers of budgeted amounts between funds.
2) A department director may transfer funds up to $5,000 within the department’s
operating capital accounts.
3) No expenditure of encumbrance may occur without a sufficient budgetary balance.
The City uses encumbrance accounting, under which purchase orders, contracts, and other
commitments for the expenditure of funds, are recorded to reserve that portion of applicable
appropriation. Encumbrances represent commitments related to unperformed contracts for
goods or services. Most operating encumbrances outstanding at year-end are canceled.
The Sales Tax Capital Projects Fund expenditures exceeded the budget for 2021,
utilizing revenues greater than expected. This timing difference will be corrected in
future years.
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