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Indian River County, Florida <br />Notes To Financial Statements <br />Year Ended September 30, 2011 <br />NOTE 19 - FUND BALANCE <br />GASB Statement 54, Fund Balance Reporting and Governmental Funds Type Definitions, requires the <br />fund balance for governmental funds to be reported in classifications that comprise a hierarchy based <br />primarily on the extent to which the government is bound to honor constraints on the specific purposes <br />for which amounts in those funds can be spent. <br />A. Categories <br />There are five categories of fund balance for governmental funds under Statement 54: <br />Nonspendable — Amounts that cannot be spent because they are not in spendable form or are legally or <br />contractually required to remain intact. <br />Restricted — Use of these resources is based on the constraints imposed externally by creditors, <br />grantors, contributors, or laws and regulations of other governments; or imposed by law through <br />constitutional provisions or enabling legislation. <br />Committed — Amounts whose use is constrained by formal action of the Board of County <br />Commissioners, including resolution or ordinance. This category includes contractual obligations <br />entered into by the Board of County Commissioners. <br />Assigned — The Board of County Commissioners is the governing body authorized to assign fund <br />balance amounts to be used for specific purposes. Amounts appropriated to eliminate a budgetary <br />deficit in a subsequent year are reported in this category as well. <br />Unassigned — Residual amounts in the general fund that do not meet any of the other fund balance <br />classifications. <br />B. Fund Balance Policy <br />On September 21, 2010, the County approved a Fund Balance and Reserve Policy that set forth the <br />following reserves of fund balance in the General, Transportation, and Emergency Services District <br />Funds: <br />Emergency/Disaster Relief Reserve — A balance of no less than 5% of budgeted operating expenditures <br />for the current fiscal year will be reserved only for the purpose of responding to natural and man-made <br />disasters. Disasters include hurricanes, tropical storms, floods, wildfires, or terrorist activities. These <br />funds can only be used to respond and provide relief after such a disaster. Funds will be replenished <br />over a five-year period after the completion of the recovery from the disaster. This reserve is presented <br />as committed fund balance in those funds. <br />92 <br />