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7

City of Raleigh

Financial Section

Net change in

fund balances

- total governmental funds

(17,434,459)

$       

104,914,591

Net change in pension assets/liabilities

582,238

(601,945)

Debt issued or incurred:

General obligation bonds issued

6,026,841

$                   

Installment financing

55,200,437

Bond Refunding:

Face amount of new debt

158,124,598

Payment to Escrow Agent

(158,124,598)

Principal repayments:

General obligation debt

(22,419,502)

Installment financing

(11,980,295)

Net adjustment

26,827,481

$                 

         (26,827,481)

4,313,735

1,559,479

(3,791,546)

Change in net position of governmental activities

62,714,612

$        

The notes to the financial statements are an integral part of this statement.

Revenues in the statement of activities that do not provide current financial resources are not reported as revenues in the funds. Annexations -

$1,116,484; Property taxes - ($210,583); Assessments - $12,174 and loss on sale of assets-($1,520,020).

Bond proceeds provide current financial resources to governmental funds, but issuing debt increases long-term liabilities in the statement of

net assets. Repayment of bond principal is an expenditure in the governmental funds, but the repayment reduces long-term liabilities in the

statement of net assets.

Some expenses 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. Change in earned vacation pay -($429,786), and change in accrued interest expense - ($54,951) and net

pension expense $4,798,470.

Governmental funds report premiums on bonds issued as an other financing source. In the governmental activities bond premiums are

recorded as a liability and amortized over the life of the debt. Amortization for bond issue costs, deferred refunding and premium on bonds

are expenses or reduction of expenses in the governmental activities.

Internal service funds are used by management to charge the costs of certain activities, such as risk management, equipment replacement,

and central garage to individual funds. The net expense of certain activities of internal service funds is reported with governmental activities.

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES,

AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS

TO THE STATEMENT OF ACTIVITIES

For the Fiscal Year Ended June 30, 2016

The change in

net position

reported for governmental activities in the statement of activities is different because:

Governmental funds report capital outlays as expenditures. However, in the statement of activities the cost of those assets is allocated over

their estimated useful lives and reported as depreciation expense. This is the amount by which capital outlays $149,711,699 exceeded

depreciation $44,797,108 in the current period.

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