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CITY OF EUGENE, OREGON <br />Notes to Basic Financial Statements <br />(1) Summary of Significant Accounting Policies, continued <br /> (F) Equity in Pooled Cash and Investments, continued <br />It is the City’s policy to report at amortized cost all short-term, highly-liquid money market investments <br />(including corporate bonds, commercial paper, bankers’ acceptances, municipal bonds, and U.S. Treasury and <br />agency obligations) and participating interest-earning investment contracts with a remaining maturity at time of <br />purchase of one year or less. Such investments are stated at cost, increased by accretion of discounts and <br />reduced by amortization of premiums, both computed by the straight-line method. Callable investments <br />purchased at a discount are amortized to the maturity date, and callable investments purchased at a premium <br />are amortized to the first call date. Investments with a remaining maturity at time of purchase of more than one <br />year are valued at fair value. <br />The City maintains a common cash and investments pool for all City funds. Interest earned on the pooled cash <br />and investments is allocated quarterly based on each fund’s average cash and investments balance as a <br />proportion of the City’s total pooled cash and investments. For purposes of the Statement of Cash Flows, the <br />City considers “cash” to include the pooled cash and investments, since the pool has the general <br />characteristics of a demand deposit account, in that any participating fund may deposit additional cash at any <br />time and also may withdraw cash at any time without prior notice or penalty. <br />(G) Receivables <br />Unbilled service accounts receivable that are significant and meet the measurable and available criteria for <br />revenue recognition are accrued as revenue in the governmental fund financial statements at year-end. <br />Significant unbilled service accounts receivable relating to the government-wide and proprietary fund financial <br />statements are accrued as revenue when earned. <br />(H) Interfund Receivables and Payables <br />In the course of operations, numerous transactions occur between individual funds for goods provided or <br />services rendered. These receivables and payables are classified as "Due from other funds" or "Due to other <br />funds" in the fund financial statements. <br />During the year, borrowings that occur between funds are classified as interfund loans or advances. In the fund <br />financial statements, the short-term portion of such borrowings are classified as “Interfund loans receivable” or <br />“Interfund loans payable”. The noncurrent portion is classified as “Advances to other funds” or “Advances from <br />other funds”. The governmental fund financial statements report a reservation of fund balance to indicate they <br />are not available for appropriation and are not expendable available financial resources. <br />In the government-wide financial statements, all interfund receivables and payables are combined and any <br />residual balances between the governmental and business-type activities are reported as “Internal balances.” <br />See Note 4(C) to the basic financial statements for details of outstanding interfund assets and liabilities at year- <br />end. <br />(I) Inventories and Prepaid Items <br />Inventories of materials and supplies are valued at cost or average cost using the first-in/first-out method. <br />Inventories are capitalized and charged to operations as consumed in both the government-wide and fund <br />financial statements. <br />Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid <br />items in both the government-wide and fund financial statements. <br />continued <br />ìï <br />