City of Raleigh
NOTES TO THE BASIC FINANCIAL STATEMENTS
JUNE 30, 2016
Note 1. Summary of Significant Accounting Policies
A. Reporting entity
The City of Raleigh (the “City”) is a municipal corporation established in 1792 by the North Carolina General
Assembly. The City operates under a council‐manager form of government with a mayor and seven Council
Members comprising the governing body.
The accounting policies of the City of Raleigh conform to generally accepted accounting principles (GAAP) as
applicable to governments. The Governmental Accounting Standards Board (GASB) is the accepted standard‐setting
body for establishing governmental accounting and financial reporting principles in the United States of America.
All applicable GASB statements have been implemented. The accompanying financial statements present the
government and its component unit, a legally separate entity for which the City is financially accountable.
The financial statements of the following organization are included in this report as a blended component unit:
Blended Component Unit. Walnut Creek Financing Assistance Corporation (WCFAC)
The WCFAC is
governed by a five‐member board appointed by the City Council. Although it is legally separate from the City, the
WCFAC is reported as if it were part of the primary government because its main purpose is to issue certificates of
participation for the City. Financial transactions of the WCFAC are audited and reported through the Cityʹs annual
audit. No separate financial statements are prepared.
B. Government‐wide and fund financial statements
The government‐wide financial statements (i.e., the statement of net position and
the statement of activities) report information on all of the nonfiduciary activities of the City and its blended
component unit. Eliminations have been made to minimize the double‐counting of internal activities. These
statements distinguish between the governmental and business‐type activities of the City. Governmental activities
generally are financed through taxes, intergovernmental revenues, and other nonexchange transactions. Business‐
type activities are financed in whole or in part by fees charged to external parties.
The statement of activities demonstrates the degree to which the direct expenses of a given function or business‐
type activity is offset by program revenues.
are those that are clearly identifiable with a specific
function or activity. Indirect expense allocations are not shown on the statement of activities.
include 1) charges to customers or applicants who purchase, use or directly benefit from goods, services, or
privileges provided by a given function or activity and 2) grants and contributions that are restricted to meeting
the operational or capital requirements of a particular function or activity. Taxes and other items not properly
included among program revenues are reported instead as
Separate financial statements are provided for governmental funds, proprietary funds, and fiduciary funds, even
though the latter are excluded from the government‐wide financial statements. Major individual governmental
funds and major individual enterprise funds are reported as separate columns in the fund financial statements.