City of Raleigh
Other accounts receivable which are reported in governmental funds and which represent amounts considered
measurable and available are recorded as revenue but, based on state law, are restricted in fund balance at year‐
Any other accounts receivable which represent amounts not subject to accrual as earned revenue are recorded as
assets and are offset by unavailable revenue in an equal amount. Assessments receivable have been reduced by an
amount deemed to be uncollectible.
The amounts due from other governmental agencies are grants and participation agreements which are restricted
for specific programs and capital projects. Program grants, primarily accounted for in the special revenue funds,
are recognized as receivables and revenue in the period benefited, i.e., at the time reimbursable program costs are
Capital project grants are recorded as receivables and revenues at the time reimbursable project costs are incurred.
3. Inventories, prepaid items and assets held for resale
Inventories in the governmental, enterprise and internal service funds consist primarily of expendable supplies
held for consumption. Inventories are recorded as an expenditure at the time an item is used and are carried at
cost, using the first‐in, first‐out (FIFO) method.
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as prepaid
items in both government‐wide and fund financial statements.
Assets held for resale in the amount of $11,625,378 as of June 30, 2016, can be found on the combining balance sheet
for capital project funds as well as the government wide statement of net position and represents property that was
repurchased during 2013‐14 which is currently being held for resale.
4. Restricted assets
Certain proceeds of the City’s enterprise fund revenue bonds and general obligation bonds are classified as
restricted assets on the balance sheet because their use is limited by applicable bond covenants.
5. Capital assets
Capital assets, which include property, plant, equipment, software, and infrastructure assets, (e.g. streets,
sidewalks, water and sewer delivery systems and similar items) are reported in the applicable governmental or
business‐type activities columns in the government‐wide financial statements. All infrastructure acquired before
July 1, 2001 (date of implementation of GASB 34) has been recorded by the City at historical cost if purchased or
constructed or at fair market value at the date of donation. Capital assets are defined by the City as assets with
an initial, individual cost of more than $5,000 and an estimated useful life in excess of two years. Such assets are
recorded at historical cost or estimated historical cost if purchased or constructed. Donated capital assets
received prior to June 15, 2015 are recorded at their estimated fair value at the date of donation. Donated capital
assets received after June 15, 2015 are recorded at acquisition value. All other purchased or constructed capital
assets are reported at cost or estimated historical cost. The costs of normal maintenance and repairs that do not
add to the value of the asset or materially extend assets lives are not capitalized.
Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred
during the construction phase of capital assets of business‐type activities is included as part of the capitalized
value of the assets constructed. The total interest expense incurred by the City for business‐type activities
during the fiscal year was $32,561,887. Of this amount, $5,582,185 was included as part of the cost of capital
assets under construction in connection with water and sewer projects.