HomeMy WebLinkAbout18 - Other Long-Term Debt CITY OF BROOKLYN CENTER
ALLOCATION OF LONG -TERM LIABILITIES ON GW STATEMENTS
DECEMBER 31, 2006
LTD in 1 year Beginning Adjust Amort Ending
Bonds old 2 (335, 000) 2
Bonds new issues 0 0
Comp Abs 919 45 (867,823) 96
Ins 0 85 85
3 2
LTD >1 year Beginning Adjust Amort Ending
Bonds old 26,490, 000 (2 23, 950, 000
Bonds new issues 0 1 1
Comp Abs 0 0 867 867
Ins 2 0 (85, 700) 2
28 2812851430
Message Page 1 of 2
Clara Hilger
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4int: om: Dave Mol [DMOL a@hlbtr.com]
Tuesday, April 17 2007 5:21 PM
TO: Dan Jordet
Cc: Clara Hilger
Subject: RE: loss contingencies
Dan - I agree with booking the $530,405. No further information is needed for our files.
Dave
- - - -- original Message---- -
From: Dan Jordet [mailto:DJordet @ci.brooklyn - center.mn.us]
Sent: Tuesday, April 17, 2007 4 :31 PM
To: Dave Mol
Cc: Clara Hilger
Subject: RE: loss contingencies
Dave:
Given the information emphasized in the double underline below, I would believe that we have to
report the minimum of the MCES loss for reporting purposes, The minimum number is $ 580,465,
which is the present value of the stream of monthly payments discounted at 4 to make a lump sum
payment, The maximum number is $ 653,867, the amount due under the statute of limitations for
unpaid utility use, Let me know what additional information you may need to complete Y our p Y
examination of this issue.
. : w ..... ........................... .............,..,.............. ...
From: Dave Mol [mailto:DMOL
Sent: Wednesday, April 11, 2007 3:07 PM
To: Dan Jordet
Subject: loss contingencies
Dan - please review the standards below as it relates to the MCES liability.
LOSS CONTINGENCIES
10.201 A loss contingency will not develop into an actual loss until a particular future event occurs. Thus, accounting for
a loss contingency is based on whether the likelihood of the future event occurring is probable (likely to occur), reasonably
possible (more than slight but less than likely) or remote (slight). (SFAS 5, par. 3) Depending on whether it is probable
reasonably possible, or remote, a loss contingency may be required to be accrued, disclosed, or neither.
10.202 The estimated loss from a loss contingency should be accrued through a charge to income and disclosed when
both of the following conditions are met: (SFAS 5, par. 8)
a. Information available prior to issuin the financial statements indicates that it is probable that a loss has been incurred
at the financial statement date.
b. The amount of loss can be r easonably estimated. (A loss that is not accrued in the period it becomes probable
because its amount cannot be reasonably estimated should be accrued in the period its amount can be reasonably
4/18/2007
Message Page 2 of 2
estimated. Prior periods should not be adjusted.) (SFAS 16, par. 37)
If a loss is probable but only a range of -loss can be reasonably estimated, conditions a. and b. are still met and a loss
should be accrued. In such cases the minimum amount of the ran a should be accrued unless another amount is a better
estimate. If it is reasonablv Dossible that the actual loss will exceed the amount accrued the additional exposure to loss
should be disclosed (FASBI 14, par. 4) Adjustment in subsequent periods of the amount accrued is a change in estima
(See Chapter 1.)
4/18/2007