Comprehensive Annual Financial Report - Harford County Public ...

HARFORD COUNTY PUBLIC SCHOOLS
NOTES TO FINANCIAL STATEMENTS
June 30, 2012
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Net Assets and Fund Balance
The difference between fund assets and liabilities is “Net Assets” on the government-wide and
fiduciary fund statements and “Fund Balance” on governmental fund statements. Net Assets are
classified as “Invested in Capital Assets, Net of Related Debt,” legally “Restricted” for a specific
purpose or “Unrestricted” and available for appropriation for general purposes.
In the governmental fund financial statements, non-spendable and restricted fund balance
represent amounts that are legally restricted by outside parties for use for a specific purpose or
are otherwise not available for appropriation. Committed fund balance represents amounts that
are reserved for a particular purpose by the Board and would require action by the Board to
release the fund balance from its commitment. Assigned fund balance represents tentative
management plans that are subject to change.
Use of Estimates in Preparing Financial Statements
The preparation of financial statements in conformity with GAAP requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure
of contingent assets and liabilities at the date of the financial statements and the reported
amounts of revenues and expenditures during the reporting period. Actual results could differ
from those estimates.
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