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Indian River County, Florida <br />Notes To Financial Statements <br />Year Ended September 30, 2010 <br />NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued <br />D. Assets, Liabilities, and Net Assets or Equity - Continued <br />2. Investments <br />Investments consist of U.S. Treasury Securities, U.S. Government Agency Securities, money market <br />funds, Florida PRIME Fund (formerly known as the Local Government Surplus Funds Trust Fund <br />Investment (SBA) Fund A), Fund B Surplus Funds Trust Fund, and the Florida Local Government <br />Investment Trust Fund. Investments are reported at fair value based upon the average price obtained <br />from three brokers/dealers. The SBA and Trust values are based upon the fair market value per share of <br />the underlying portfolio. Refer to Note 4-C, Investments, for further information on individual <br />investments. <br />3. Allowance for Doubtful Accounts <br />The County provides an allowance for water and sewer accounts receivables that may become <br />uncollectible. At September 30, 2010, this allowance was $424,493. No other allowances for doubtful <br />accounts are maintained since other accounts receivable are considered collectible as reported at <br />September 30, 2010. <br />4. Receivables and Payables <br />Activities between funds that are representative of lendingiborrowing arrangements outstanding at the <br />end of the fiscal year are referred to as "due to/from other funds". Any residual balances outstanding <br />between the governmental activities and business -type activities are reported in the government -wide <br />financial statements as "internal balances". All receivables are shown net of allowance for doubtful <br />accounts. Receivables in excess of 120 days comprise the trade accounts receivable allowance for <br />doubtful accounts. <br />5. Inventories <br />Inventories are valued at cost, which approximates market, using the "first -in, first -out" method of <br />accounting, with the exception of the Fleet Internal Service Fund's inventory which is valued using the <br />moving average cost method of accounting. Inventories of all funds are recorded as expenditures <br />(expenses) when consumed rather than when purchased. <br />6. Prepaid Items <br />Prepaid items in the governmental funds represent prepayments for services that will be used in future <br />periods. The County's policy is to record the expenditure for the services when they are used rather <br />than when the cash is disbursed. <br />51 <br />