Comprehensive Annual Financial Report - Harford County Public ...

Harford County Public Schools
Exhibit 6
RECONCILIATION OF THE GOVERNMENTAL FUNDS STATEMENT OF
REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES
FOR THE YEAR ENDED JUNE 30, 2012
Total net change in fund balances - governmental funds (Exhibit 5) $ 1,706,257
Amounts reported for governmental activities in the statement of activities are different because:
Capital outlays are reported in governmental funds as expenditures. However, in the statement of
activities, the cost of those assets is allocated over their estimated useful lives as depreciation
expense. This is the amount by which capitalized capital outlay ($21,480,338) exceeds depreciation
expense ($ 13,369,964) and loss on disposal of assets ($30,311). 8,080,063
Capital lease provides current financial resources to government funds but increases long-term
liabilities in the statement of net assets. Repayment of long-term debt is reported as an
expenditure in governmental funds, but the repayment reduces long-term liabilities in the
statement of net assets. In the current year, the net effect of capital lease borrowings (43,719)
and repayment was ($43,719).
In the statement of activities, compensated absences are measured by the amounts earned during
the year. In the governmental funds, however, expenditures for compensated absences are
measured by the amount of financial resources used (essentially, the amounts actually paid or
expected to be paid within one year) This year, vacation and sick leave used exceeded the
amounts earned by $383,944. 383,944
OPEB costs reported in the statement of activities do not require the use of current financial
resources and, therefore, are not reported as expenditures in governmental funds. (17,470,114)
In the statement of activities, all inventories are charged to expense as goods are used in
operations (the consumption method). However, in the government funds, the value of
U.S.D.A. commodities is recorded as an expenditure at the time the inventory is acquired
(the purchase method) and reflected as a reservation of fund balance. The decrease in the
amount of fund balance reserved for inventory during the year was $57,357. (57,357)
Change in net assets of governmental activities (Exhibit 2) $ (7,400,926)
The accompanying notes are an integral part of this financial statement.
35