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CITY OF SULPHUR,LOUISIANA

NOTES TO FINANCIAL STATEMENTS June 30,2007

]) Summary of Significant Accounting Policies

The City of Sulphur (City) was incorporated under the provisions of the State of Louisiana LA R.S. 33:321-481. The City operates under a home rule charter.

The accounting in the United

and reporting policies States of America as

of the City applicable

conform to accounting principles generally accepted

to

governments.

Such

accounting

and

reporting

procedures also conform to the requirements of Louisiana Revised Statutes guidance set forth in the Louisiana Municipal Audit and Accounting Guide, and guide, Audits of State and Local Governmental Units.

24:517 and to the to the industry audit

The Governmental Accounting Standards Board (GASB) Statement Number 20 (effective for financial statements for periods beginning after December 15, 1993) provides guidance on accounting

and financial reporting for proprietary fund two options in applying pronouncements

(FASB)

after

November

30,

1989.

The

types and allows proprietary fund types to choose one of issued by the Financial Accounting Standards Board City of Sulphur has elected to use the first option for

reporting its activities. This interpretations, Accounting

approach Principles

applies Board

all GASB pronouncements and FASB statements and (APB) opinions, and Accounting Research Bulletins

(ARBs) issued on or before November 30, 1989, unless those contradict GASB pronouncements. Changes to FASB statements and ARBs issued after November 30, 1989, would not apply unless

pronouncements conflict with or and interpretations, APB opinions adopted by GASB.

The following is a summary of certain significant accounting policies.

A. FinancialReporting Entity

GASB Statement No. 14 established criteria for determiningthe governmental reporting entity and component units that should be included within the reporting entity.. For financial reporting purposes, in conformance with GASB Standards No. 14, the City of Sulphur, Louisiana, is the financial reporting entity. The financial reporting entity consists of (a) the primary government, (b) organizations for which the primary government is financially accountable, and (c) other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entity's financial statements to be misleading or incomplete.

The basic criterion for including a potential componentunit

accountability. accountability.

The GASB has set This criteria includes:

forth

criteria

to

be

within the reporting entity is financial considered in determining financial

I. Appointing a voting majority of an organization's governing body and

  • a.

    The ability of the City of Sulphur to impose its will on that organization and/or

  • b.

    The potential for the organization to provide specific financial benefits to or impose

specific financial burdens on the City of Sulphur.

28

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