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2011 Comprehensive Annual Financial Report (PDF)
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Source page 41
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Major Fund Criteria
Major funds must be reported if the following criteria are met:
• If the total assets, liabilities, revenues, or expenditures/expenses of an individual governmental or
enterprise fund are at least 10 percent of the corresponding element (assets, liabilities, etc.) for all
funds of that category or type (total governmental or total enterprise funds), and
• If the total assets, liabilities, revenues, or expenditures/expenses of the individual governmental
fund or enterprise fund are at least 5 percent of the corresponding element for all governmental
and enterprise funds combined.
Additionally, any other governmental or enterprise fund that management believes is particularly
significant to the basic financial statements may be reported as a major fund.
Fiduciary funds are reported by fund type.
C. Measurement Focus, Basis of Accounting and Financial Statement Presentation
Government-Wide Financial Statements
The government-wide financial statements are reported using the economic resources measurement focus and
the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are
recorded when the liabilities are incurred. Real estate and personal property taxes are recognized as revenues in
the fiscal year for which they are levied. Grants and similar items are recognized as revenue as soon as all
eligibility requirements imposed by the provider have been met.
The statement of activities demonstrates the degree to which the direct expenses of a particular function or
segment are offset by program revenues. Direct expenses are those that are clearly identifiable with a specific
function or segment. Program revenues include the following:
• Charges to customers or applicants who purchase, use, or directly benefit from goods, services, or
privileges provided by a given function or segment.
• Grants and contributions that are restricted to meeting the operational requirements of a particular
function or segment.
• Grants and contributions that are restricted to meeting the capital requirements of a particular function or
segment.
Taxes and other items not identifiable as program revenues are reported as general revenues.
For the most part, the effect of interfund activity has been removed from the government-wide financial
statements. However, the effect of interfund services provided and used between functions is not eliminated as
the elimination of these charges would distort the direct costs and program revenues reported for the functions
affected.
Town of Canton, Massachusetts 34 Comprehensive Annual Financial ReportSource page 42
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 Fund Financial Statements Governmental fund financial statements are reported using the flow of current financial resources measurement focus and the modified accrual basis of accounting. Under the modified accrual basis of accounting, revenues are recognized when susceptible to accrual (i.e., measurable and available). Measurable means the amount of the transaction can be determined and available means collectible within the current period or soon enough thereafter to pay liabilities of the current period. Expenditures are recorded when the related fund liability is incurred, except for unmatured interest on general long-term debt which is recognized when due, certain compensated absences and claims and judgments which are recognized when the obligations are expected to be liquidated with current expendable available resources. The Town considers property tax revenues available if they are collected within 60 days after fiscal year-end. Investment income is susceptible to accrual. Other receipts and tax revenues become measurable and available when the cash is received and are recognized as revenue at that time. Entitlements and shared revenues are recorded at the time of receipt or earlier if the susceptible to accrual criteria is met. Expenditure driven grants recognize revenue when the qualifying expenditures are incurred and all other grant requirements are met. The following major governmental funds are reported: The general fund is the primary operating fund. It is used to account for all financial resources, except those that are required to be accounted for in another fund. The nonmajor governmental funds consist of special revenue, other capital projects and permanent funds that are aggregated and presented in the nonmajor governmental funds column on the governmental funds financial statements. The following describes the general use of these fund types: The special revenue fund is used to account for and report the proceeds of specific revenue sources that are restricted or committed to expenditure for specified purposes other than permanent funds or capital projects. The capital projects fund is used to account for and report financial resources that are restricted, committed, or assigned to expenditure for capital outlays, including the acquisition or construction of capital facilities and other capital assets of the governmental funds. The permanent fund is used to account for and report financial resources that are legally restricted to the extent that only earnings, not principal, may be used for purposes that support the governmental programs. Proprietary fund financial statements are reported using the flow of economic resources measurement focus and use the accrual basis of accounting. Under this method, revenues are recorded when earned and expenses are recorded when the liabilities are incurred. Town of Canton, Massachusetts 35 Comprehensive Annual Financial Report
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Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues and expenses generally result from providing services and producing and delivering goods in connection with the proprietary funds principal ongoing operations. All revenues and expenses not meeting this definition are reported as nonoperating revenues and expenses. The following major proprietary funds are reported: The water enterprise fund is used to account for the water activities. The sewer enterprise fund is used to account for the sewer activities. The rink enterprise fund is used to account for the skating rink activities. Additionally, the following proprietary fund type is reported: Internal service funds are an accounting device used to accumulate and allocate costs internally among various functions. The Town uses internal service funds to account for health claims, workers’ compensation, unemployment claims and building insurance activities. Because these services primarily benefit governmental rather than business-type activities, they have been included within governmental activities in the government- wide financial statements. Fiduciary fund financial statements are reported using the flow of economic resources measurement focus and use the accrual basis of accounting. Fiduciary funds are used to account for assets held in a trustee capacity for others that cannot be used to support the governmental programs. The following fiduciary fund types are reported: The private-purpose trust fund is used to account for trust arrangements that exclusively benefit individuals, private organizations, or other governments. Some of these trusts have donor restrictions and trustee policies that do not allow the endowment portion and any unrealized appreciation to be spent. The restrictions and trustee policies only allows the trustees to approve spending of the realized investment earnings. The Town’s private- purpose trust fund is primarily comprised of educational scholarships. The agency fund is used to account for assets held in a purely custodial capacity. Agency funds apply the accrual basis of accounting but do not have a measurement focus. The Town’s agency funds consist of off-duty work details, performance bonds, student activity accounts and fees collected on behalf of other governments. Government-Wide and Fund Financial Statements Private-sector standards of accounting and financial reporting issued prior to December 1, 1989, generally are followed in both the government-wide and proprietary fund financial statements to the extent that those standards do not conflict with or contradict guidance of the Governmental Accounting Standards Board. Governments also have the option of following subsequent private-sector guidance for their business-type activities and enterprise funds, subject to this same limitation. The government has elected not to follow subsequent private-sector guidance. Town of Canton, Massachusetts 36 Comprehensive Annual Financial Report
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Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 D. Cash and Investments Government-Wide and Fund Financial Statements Cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with an original maturity of three months or less from the date of acquisition. Investments are carried at fair value. E. Accounts Receivable Government-Wide and Fund Financial Statements The recognition of revenue related to accounts receivable reported in the government-wide financial statements and the proprietary funds and fiduciary funds financial statements are reported under the accrual basis of accounting. The recognition of revenue related to accounts receivable reported in the governmental funds financial statements are reported under the modified accrual basis of accounting. Real Estate, Personal Property Taxes, Tax Deferrals and Tax Liens Property taxes are levied and based on values assessed on January 1st of every year. Assessed values are established by the Board of Assessor’s for 100% of the estimated fair market value. Taxes are due on August 1st, November 1st, February 1st and May 1st and are subject to penalties and interest if they are not paid by the respective due date. Property taxes levied are recorded as receivables in the fiscal year of the levy. Tax liens are processed within the first quarter following the close of the fiscal year on delinquent properties and are recorded as receivables in the fiscal year they are processed. Real estate receivables are secured via the tax lien process and are considered 100% collectible. Accordingly, an allowance for uncollectibles is not reported. Personal property taxes cannot be secured through the lien process. The allowance for uncollectibles is estimated based on historical trends and specific account analysis. Motor Vehicle Excise Taxes Motor vehicle excise taxes are assessed annually for each vehicle registered in the Town and are recorded as receivables in the fiscal year of the levy. The Commonwealth is responsible for reporting the number of vehicles registered and the fair values of those vehicles to the Town. The tax calculation is the fair value of the vehicle multiplied by $25 per $1,000 of value. The allowance for uncollectibles is estimated based on historical trends and specific account analysis. Town of Canton, Massachusetts 37 Comprehensive Annual Financial Report
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Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 User Fees Water and Sewer fees are billed quarterly based on individual meter readings and are subject to penalties and interest if they are not paid by the respective due date. Water and sewer liens are processed in June of every year and are included as a lien on the property owner’s tax bill in the following fiscal year. Water and sewer user fees, related liens, and an unbilled estimate are recorded as receivables in the fiscal year of the levy. Water and sewer user fees are secured via the tax lien process and are considered 100% collectible. Accordingly, an allowance for uncollectibles is not reported. Departmental and Other Departmental and other receivables consist primarily of ambulance fees. The allowance for uncollectibles for ambulance is estimated based on historical trends and specific account analysis. Intergovernmental Various federal and state grants for operating and capital purposes are applied for and received annually. For non-expenditure driven grants, revenue is recognized as soon as all eligibility requirements imposed by the provider have been met. For expenditure driven grants, revenue is recognized when the qualifying expenditures are incurred and all other grant requirements are met. These receivables are considered 100% collectible and therefore do not report an allowance for uncollectibles. F. Inventories Government-Wide and Fund Financial Statements Inventories are recorded as expenditures at the time of purchase. Such inventories are not material in total to the government-wide and fund financial statements, and therefore are not reported. G. Capital Assets Government-Wide and Proprietary Fund Financial Statements Capital assets, which include land, land improvements, buildings, building improvements, machinery and equipment, vehicles, and infrastructure (e.g., roads, water mains, sewer mains, and similar items), are reported in the applicable governmental or business-type activity column of the government-wide financial statements. Capital assets are recorded at historical cost or at estimated historical cost if actual historical cost is not available. Donated capital assets are recorded at the estimated fair market value at the date of donation. Construction period interest is capitalized on constructed capital assets except for the capital assets of the governmental activities column in the government-wide financial statements. All purchases and construction costs in excess of $25,000 are capitalized at the date of acquisition or construction, respectively, with expected useful lives of greater than one year. Town of Canton, Massachusetts 38 Comprehensive Annual Financial Report
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Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Capital assets (excluding land and construction-in-process) are depreciated on a straight-line basis. The
estimated useful lives of capital assets being depreciated are as follows:
Estimated
Useful
Life
Capital Asset Type (in years)
Land improvements…………………………… 20-50
Buildings………………………………………… 20-50
Building improvements………………………… 20-50
Machinery and equipment……………………… 3-20
Vehicles………………………………………… 5
Infrastructure…………………………………… 40-50
The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend asset
lives are not capitalized and are treated as expenses when incurred. Improvements are capitalized.
Governmental Fund Financial Statements
Capital asset costs are recorded as expenditures in the acquiring fund in the fiscal year of the purchase.
H. Interfund Receivables and Payables
During the course of its operations, transactions occur between and within individual funds that may result in
amounts owed between funds.
Government-Wide Financial Statements
Any residual balances outstanding between the governmental activities and business-type activities are reported
in the statement of net assets as “internal balances”.
Fund Financial Statements
Transactions of a buyer/seller nature between and within funds are not eliminated from the individual fund
statements. Receivables and payables resulting from these transactions are classified as “Due from other funds”
or “Due to other funds” on the balance sheet.
I. Interfund Transfers
During the course of its operations, resources are permanently reallocated between and within funds. These
transactions are reported as transfers in and transfers out.
Government-Wide Financial Statements
Transfers between and within governmental funds and fiduciary funds are eliminated from the governmental
activities in the statement of activities. Any residual balances outstanding between the governmental activities
and business-type activities are reported in the statement of activities as “Transfers, net”.
Town of Canton, Massachusetts 39 Comprehensive Annual Financial ReportSource page 47
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 Fund Financial Statements Transfers between and within funds are not eliminated from the individual fund statements and are reported as transfers in and transfers out. J. Deferred Revenue Deferred revenue at the governmental fund financial statement level represents billed receivables that do not meet the available criterion in accordance with the current financial resources measurement focus and the modified accrual basis of accounting. Deferred revenue is recognized as revenue in the conversion to the government-wide (full accrual) financial statements. K. Net Assets and Fund Equity Government-Wide Financial Statements (Net Assets) Net assets reported as “invested in capital assets, net of related debt” includes capital assets, net of accumulated depreciation, less the principal balance of outstanding debt used to acquire capital assets. Unspent proceeds of capital related debt are not considered to be capital assets. Outstanding debt related to future reimbursements from the state’s school building program is not considered to be capital related debt. Net assets are reported as restricted when amounts that are not available for appropriation or are legally restricted by outside parties for a specific future use. Net assets have been “restricted for” the following: “Permanent funds - expendable” represents the amount of realized and unrealized investment earnings of donor restricted trusts. The donor restrictions and trustee policies only allows the trustees to approve spending of the realized investment earnings that support governmental programs. “Permanent funds - nonexpendable” represents the endowment portion of donor restricted trusts that support governmental programs. “Grants and gifts” represents restrictions placed on assets from outside parties and consist primarily of gifts and federal and state grants. “MSBA Grant” represents a capital grant to fund debt service on the High School debt that will be amortized over 15 years starting in fiscal year 2010 in accordance with state governmental regulations. Fund Financial Statements (Fund Balances) Governmental fund balances are classified as nonspendable, restricted, committed, assigned, or unassigned based on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. The governmental fund balance classifications are as follows: “Nonspendable” fund balance includes amounts that cannot be spent because they are either not in spendable form or they are legally or contractually required to be maintained intact. Town of Canton, Massachusetts 40 Comprehensive Annual Financial Report
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Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 “Restricted” fund balance includes amounts subject to constraints placed on the use of resources that is either externally imposed by creditors, grantors, contributors, or laws or regulations of other governments; or that are imposed by law through constitutional provisions or enabling legislation. “Committed” fund balance includes amounts that can only be used for specific purposes pursuant to constraints imposed by formal action of the government’s highest level of decision-making authority. “Assigned” fund balance includes amounts that are constrained by the Town’s intent to be used for specific purposes, but are neither restricted nor committed. “Unassigned” fund balance includes the residual classification for the general fund. This classification represents fund balance that has not been assigned to other funds and that has not been restricted, committed, or assigned to specific purposes within the general fund. L. Long-term debt Government-Wide and Proprietary Fund Financial Statements Long-term debt is reported as liabilities in the government-wide and proprietary fund statement of net assets. Material bond premiums and discounts are deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported net of the applicable bond premium or discount. Governmental Fund Financial Statements The face amount of governmental funds long-term debt is reported as other financing sources. Bond premiums and discounts, as well as issuance costs, are recognized in the current period. Bond premiums are reported as other financing sources and bond discounts are reported as other financing uses. Issuance costs, whether or not withheld from the actual bond proceeds received, are reported as general government expenditures. M. Investment Income Excluding the permanent funds, investment income derived from major and nonmajor governmental funds is legally assigned to the general fund unless otherwise directed by Massachusetts General Law (MGL). Investment income from the proprietary funds is retained in the respective funds. N. Compensated Absences Employees are granted vacation and sick leave in varying amounts based on collective bargaining agreements, state laws and executive policies. Government-Wide and Proprietary Fund Financial Statements Vested or accumulated vacation and sick leave are reported as liabilities and expensed as incurred. Governmental Fund Financial Statements Vested or accumulated vacation and sick leave, which will be liquidated with expendable available financial resources upon maturity of the liability, are reported as expenditures and fund liabilities. Town of Canton, Massachusetts 41 Comprehensive Annual Financial Report
Source page 49
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 O. Fund Deficits Two Capital Projects Funds, classified as non-major governmental funds, had a combined deficit balance of $1,301,454 at June 30, 2011. This deficit will primarily be funded when $1.2 million in bond anticipation notes are converted into long-term debt. P. Use of Estimates Government-Wide and Fund Financial Statements The preparation of basic financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure for contingent assets and liabilities at the date of the basic financial statements and the reported amounts of the revenues and expenditures/expenses during the fiscal year. Actual results could vary from estimates that were used. Q. Total Column Government-Wide Financial Statements The total column presented on the government-wide financial statements represents consolidated financial information. Fund Financial Statements The total column on the fund financial statements is presented only to facilitate financial analysis. Data in this column is not the equivalent of consolidated financial information. NOTE 2 – CASH AND INVESTMENTS A cash and investment pool is maintained that is available for use by all funds. Each fund type's portion of this pool is displayed on the balance sheet as "Cash and cash equivalents". The deposits and investments of the trust funds are held separately from those of other funds. Statutes authorize the investment in obligations of the U.S. Treasury, agencies, and instrumentalities, certificates of deposit, repurchase agreements, money market accounts, bank deposits and the State Treasurer's Investment Pool (the Pool). The Treasurer may also invest trust funds in securities, other than mortgages or collateral loans, which are legal for the investment of funds of savings banks under the laws of the Commonwealth. The Pool meets the criteria of an external investment pool. The Pool is administered by the Massachusetts Municipal Depository Trust (MMDT), which was established by the Treasurer of the Commonwealth who serves as Trustee. The fair value of the position in the Pool is the same as the value of the Pool shares. Town of Canton, Massachusetts 42 Comprehensive Annual Financial Report
Source page 50
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Custodial Credit Risk – Deposits
In the case of deposits, this is the risk that in the event of a bank failure, the Town’s deposits may not be returned
to it. The Town does not have a deposit policy for custodial credit risk. At fiscal year-end, the carrying amount of
deposits totaled $22,609,532 and the bank balance totaled $23,168,068. Of the bank balance, $2,163,669 was
covered by Federal Depository Insurance, $16,392,882 was covered by the Depositors Insurance Fund,
$3,616,804 was collateralized and $994,713 was exposed to custodial credit risk because it was uninsured and
uncollateralized.
Investments
As of June 30, 2011, the Town of Canton had the following investments:
Maturity
Fair Value Under 1 Year 1-5 Years 6-10 Years
Investment Type
Debt Securities:
Federal Home Loan Banks……………………$ 147,349 $ - $ 106,584 $ 40,765
Federal Home Loan Mortgage Corp………… 609,818 - 486,188 123,630
Federal Home Loan Mortgage Corp Gold….. 1,585 - 1,585 -
Federal National Mortgage Association……… 281,335 - 281,335 -
Federal Farm Credit Bank…………. ………… 105,665 - 105,665 -
United States Treasury Notes………………… 903,166 99,422 803,744 -
Total Debt Securities.................................... 2,048,918 $ 99,422 $ 1,785,101 $ 164,395
Other Investments:
Equity Mutual Funds....................................... 40,992
Repurchase Agreement………………………… 650,000
MMDT…………………………………………… 6,952,853
Total Investments.........................................$ 9,692,763
The Town participates in MMDT, which maintains a cash portfolio and a short-term bond fund with combined
average maturities of approximately 3 months.
Custodial Credit Risk – Investments
For an investment, this is the risk that, in the event of a failure by the counterparty, the Town will not be able to
recover the value of its investments or collateral security that are in the possession of an outside party. The Town
has a custodial credit risk exposure of $2,048,918 because the related debt securities are uninsured, unregistered
and held by the counterparty. The investments in MMDT are not exposed to custodial credit risk because their
existence is not evidenced by securities that exist in physical or book entry form. The Town does not have an
investment policy related to custodial credit risk.
The Town’s $650,000 investment in a Repurchase Agreement (REPO) is held by a counterparty. The REPO is
not in the Town’s name; however, it is fully collateralized. The collateralization consists of Fannie Mae, Freddie
Mac, Ginnie Mae and Federal Home Loan Bank (FHLB) investments.
Town of Canton, Massachusetts 43 Comprehensive Annual Financial ReportSource page 51
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Interest Rate Risk
The Town does not have a formal investment policy that limits investment maturities as a means of managing its
exposure to fair value losses arising from increasing interest rates.
Credit Risk
The Town has not adopted a formal policy related to Credit Risk. Moody’s Investors Service rated all debt
securities as AAA and MMDT is unrated.
Concentration of Credit Risk
The Town places no limit on the amount the government may invest in any one issuer. The Town has 28% of
investments in US government backed securities and 72% in MMDT.
NOTE 3 – RECEIVABLES
At June 30, 2011, receivables for the individual major and non-major governmental funds in the aggregate,
including the applicable allowances for uncollectible accounts, are as follows:
Allowance
Gross for Net
Amount Uncollectibles Amount
Receivables:
Real estate and personal property taxes…………$ 801,747 $ (62,337) $ 739,410
Tax liens…………………………………………… 846,362 - 846,362
Motor vehicle and other excise taxes…………… 519,693 (348,830) 170,863
Departmental and other…………………………… 345,227 (188,087) 157,140
Intergovernmental………………………………… 4,749,911 - 4,749,911
Total…………………………………………………$ 7,262,940 $ (599,254) $ 6,663,686
At June 30, 2011, receivables for the proprietary funds consist of the following:
Allowance
Gross for Net
Amount Uncollectibles Amount
Receivables:
Water fees……………………………………………$ 1,826,007 $ - $ 1,826,007
Sewer fees…………………………………………… 1,288,254 - 1,288,254
Special assessments……………………………… 18,179 - 18,179
Intergovernmental…………………………………… 659,680 - 659,680
Total…………………………………………………$ 3,792,120 $ - $ 3,792,120
Town of Canton, Massachusetts 44 Comprehensive Annual Financial ReportSource page 52
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Governmental funds report deferred revenue in connection with receivables and other assets for revenues that
are not considered to be available to liquidate liabilities of the current period. At the end of the current fiscal year,
the various components of deferred revenue reported in the governmental funds were as follows:
Other
General Governmental
Fund Funds Total
Receivable and other asset type:
Real estate and personal property taxes…………$ 547,614 $ - $ 547,614
Tax Liens…………………………………………… 846,362 - 846,362
Motor vehicle excise taxes………………………… 170,863 - 170,863
Departmental and other…………………………… - 157,140 157,140
Intergovernmental………………..………………… 4,001,029 - 4,001,029
Tax foreclosures…………………………………… 257,922 - 257,922
Total…………………………………………………$ 5,823,790 $ 157,140 $ 5,980,930
NOTE 4 – CAPITAL ASSETS
Capital asset activity for the fiscal year ended June 30, 2011, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Governmental Activities:
Capital assets not being depreciated:
Land…………………………………………………… $ 11,158,868 $ - $ - $ 11,158,868
Construction in progress…………………………… 1,779,685 743,440 (1,444,657) 1,078,468
Total capital assets not being depreciated…… 12,938,553 743,440 (1,444,657) 12,237,336
Capital assets being depreciated:
Land improvements………………………………… 2,639,043 126,068 - 2,765,111
Buildings……………………………………………… 76,709,754 743,815 - 77,453,569
Building improvements……………………………… 16,147,257 1,833,843 - 17,981,100
Machinery and equipment…………………………… 4,483,642 1,086,907 - 5,570,549
Vehicles……………………………………………… 4,234,439 60,304 (25,753) 4,268,990
Infrastructure………………………………………… 16,451,123 621,344 - 17,072,467
Total capital assets being depreciated………… 120,665,258 4,472,281 (25,753) 125,111,786
Less accumulated depreciation for:
Land improvements………………………………… (651,581) (165,494) - (817,075)
Buildings.……………………………………………… (15,980,234) (1,761,912) - (17,742,146)
Building improvements……………………………… (7,648,550) (594,957) - (8,243,507)
Machinery and equipment…………………………… (1,817,302) (480,043) - (2,297,345)
Vehicles……………………………………………… (3,574,775) (200,722) 25,753 (3,749,744)
Infrastructure………………………………………… (2,910,273) (419,045) - (3,329,318)
Total accumulated depreciation………………… (32,582,715) (3,622,173) 25,753 (36,179,135)
Total capital assets being depreciated, net…………… 88,082,543 850,108 - 88,932,651
Total governmental activities capital assets, net………$ 101,021,096 $ 1,593,548 $ (1,444,657) $ 101,169,987
Town of Canton, Massachusetts 45 Comprehensive Annual Financial ReportSource page 53
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Beginning Ending
Balance Increases Decreases Balance
Water Activities:
Capital assets not being depreciated:
Land…………………………………………………… $ 624,852 $ - $ - $ 624,852
Construction in progress…………………………… 7,793,028 5,907,522 (7,559,823) 6,140,727
Total capital assets not being depreciated…… 8,417,880 5,907,522 (7,559,823) 6,765,579
Capital assets being depreciated:
Buildings.……………………………………………… 4,139,989 5,083,313 - 9,223,302
Machinery and equipment…………………………… 924,732 - - 924,732
Vehicles……………………………………………… 420,336 - - 420,336
Infrastructure………………………………………… 16,063,756 2,854,625 - 18,918,381
Total capital assets being depreciated………… 21,548,813 7,937,938 - 29,486,751
Less accumulated depreciation for:
Buildings.……………………………………………… (1,857,571) (138,193) - (1,995,764)
Machinery and equipment…………………………… (171,371) (92,473) - (263,844)
Vehicles……………………………………………… (338,846) (23,577) - (362,423)
Infrastructure………………………………………… (8,195,952) (326,028) - (8,521,980)
Total accumulated depreciation………………… (10,563,740) (580,271) - (11,144,011)
Total capital assets being depreciated, net…………… 10,985,073 7,357,667 - 18,342,740
Total business-type activities capital assets, net………$ 19,402,953 $ 13,265,189 $ (7,559,823) $ 25,108,319
Beginning Ending
Balance Increases Decreases Balance
Sewer Activities:
Capital assets not being depreciated:
Construction in progress…………………………… $ 1,435,319 $ 4,562,555 $ (801,589) $ 5,196,285
Total capital assets not being depreciated…… 1,435,319 4,562,555 (801,589) 5,196,285
Capital assets being depreciated:
Buildings.……………………………………………… 1,263,604 - - 1,263,604
Machinery and equipment…………………………… 264,697 - - 264,697
Vehicles……………………………………………… 265,462 45,254 - 310,716
Infrastructure………………………………………… 22,099,119 801,589 - 22,900,708
Total capital assets being depreciated………… 23,892,882 846,843 - 24,739,725
Less accumulated depreciation for:
Buildings.……………………………………………… (225,617) (30,123) - (255,740)
Machinery and equipment…………………………… (39,705) (26,470) - (66,175)
Vehicles……………………………………………… (219,061) (21,069) - (240,130)
Infrastructure………………………………………… (13,560,079) (410,299) - (13,970,378)
Total accumulated depreciation………………… (14,044,462) (487,961) - (14,532,423)
Total capital assets being depreciated, net…………… 9,848,420 358,882 - 10,207,302
Total business-type activities capital assets, net………$ 11,283,739 $ 4,921,437 $ (801,589) $ 15,403,587
Town of Canton, Massachusetts 46 Comprehensive Annual Financial ReportSource page 54
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Beginning Ending
Balance Increases Decreases Balance
Rink Activities:
Capital assets being depreciated:
Building improvements……………………………… $ 139,960 $ - $ - $ 139,960
Machinery and equipment…………………………… 257,797 - - 257,797
Vehicles……………………………………………… 29,160 - - 29,160
Total capital assets being depreciated………… 426,917 - - 426,917
Less accumulated depreciation for:
Building improvements……………………………… (38,489) (7,248) - (45,737)
Machinery and equipment…………………………… (106,945) (18,164) - (125,109)
Vehicles……………………………………………… (29,160) - - (29,160)
-
Total accumulated depreciation………………… (174,594) (25,412) - (200,006)
Total business-type activities capital assets, net………$ 252,323 $ (25,412) $ - $ 226,911
Depreciation expense was charged to functions/programs of the primary government as follows:
Governmental Activities:
General government…………………………………………………… $ 97,508
Public safety…………………………………………………………… 554,200
Education………………………………………………………………… 2,075,816
Public works…………………………………………………………… 531,575
Human services………………………………………………………… 12,899
Culture and recreation………………………………………………… 350,175
Total depreciation expense - governmental activities…………………… $ 3,622,173
Business-Type Activities:
Water…………………………………………………………………… $ 580,271
Sewer…………………………………………………………………… 487,961
Rink……………………………………………………………………… 25,412
Total depreciation expense - business-type activities…………………… $ 1,093,644
Town of Canton, Massachusetts 47 Comprehensive Annual Financial ReportSource page 55
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
NOTE 5 – INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS
Interfund receivables and payables for the fiscal year ended June 30, 2011, are summarized as follows:
Receivable Fund Payable Fund Amount
Stoughton Mitigation Fund… Water Fund………………………………………………………………$ 72,400 (1)
1) Represents a 10 year non-interest bearing loan between the Stoughton Mitigation Fund
and the Water Fund with annual payments of $36,200 through FY2013.
Interfund transfers for the fiscal year ended June 30, 2011, are summarized as follows:
Transfers In:
Nonmajor
General Governmental
Transfers Out: Fund Funds Total
General Fund……………………… $ - $ 234,912 $ 234,912 (1)
Nonmajor Governmental Funds… 1,278,885 - 1,278,885 (2)
Water Enterprise Fund…………… 668,728 - 668,728 (3)
Sewer Enterprise Fund…………… 360,181 - 360,181 (3)
Rink Enterprise Fund……………… 72,616 - 72,616 (3)
Internal Service Funds…………… 250,000 - 250,000 (4)
Total…………………………………$ 2,630,410 $ 234,912 $ 2,865,322
(1) Represents budgeted transfers of $80,000 for retirement buyback reserves, and $154,912 to fund capital
project funds.
(2) Represents transfers from various non-major governmental funds to fund budgeted expenditures.
(3) Represents budgeted transfers from the Water, Sewer, and Rink Enterprise funds for their share of
indirect charges.
(4) Represents budgeted transfer from the Unemployment Claims Fund to fund Snow and Ice expenditures.
Town of Canton, Massachusetts 48 Comprehensive Annual Financial ReportSource page 56
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
NOTE 6 – SHORT-TERM FINANCING
Short-term debt may be authorized and issued to fund the following:
• Current operating costs prior to the collection of revenues through issuance of revenue or tax anticipation
notes (RANS or TANS).
• Capital project costs and other approved expenditures incurred prior to obtaining permanent financing through
issuance of bond anticipation notes (BANS) or grant anticipation notes (GANS).
Short-term loans are general obligations and carry maturity dates that are limited by statute. Interest
expenditures and expenses for short-term borrowings are accounted for in the General Fund and Enterprise
Funds, respectively.
Details related to the short-term debt activity for the fiscal year ended June 30, 2011, is as follows:
Balance at Balance at
Rate June 30, Renewed/ Retired/ June 30,
Type Purpose (%) Due Date 2010 Issued Redeemed 2011
BAN Capital improvements………………… 1.5% 05/27/11 $ 1,524,700 $ - $ 1,524,700 $ -
BAN Highway……………………………… 1.4% 07/19/10 1,400,000 - 1,400,000 -
BAN Capital improvements………………… 1.5% 05/25/12 - 1,225,308 - 1,225,308
Sub-total governmental notes……… 2,924,700 1,225,308 2,924,700 1,225,308
BAN Sewer System Improvements……… 1.5% 05/27/11 150,000 - 150,000 -
BAN Water System Improvements……… 1.5% 05/27/11 5,562,800 - 5,562,800 -
BAN Sewer System Improvements……… 1.5% 05/25/12 - 100,000 - 100,000
BAN Water System Improvements……… 1.5% 05/25/12 - 500,000 - 500,000
-
Sub-total business-type notes……… 5,712,800 600,000 5,712,800 600,000
Total notes payable…………………… $ 8,637,500 $ 1,825,308 $ 8,637,500 $ 1,825,308
NOTE 7 – CAPITAL LEASE OBLIGATIONS
In fiscal year 2009 the Town entered into a non-cancelable long-term lease for the purchase of two vehicles
utilized by the Town. In fiscal year 2011 the Town entered into a similar lease agreement for the purchase of two
Fire Department vehicles. These lease agreements qualify as capital leases for accounting purposes and,
therefore, have been recorded at the present value of their future minimum lease payments as of the inception
date. Assets acquired through capital leases are as follows:
Governmental
Activities
Asset:
Vehicles………………………………………………………$ 156,895
Less: accumulated depreciation…………………………… (51,846)
Total………………………………………………………$ 105,049
Town of Canton, Massachusetts 49 Comprehensive Annual Financial ReportSource page 57
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
The following is a schedule of the future minimum lease payments under these capital leases, together with the
present value of the net minimum lease payments, as of June 30, 2011:
Fiscal Years Governmental
Ending June 30 Activities
2012……………………………………………………… 44,766
2013……………………………………………………… 22,167
Total minimum lease payments……………………… 66,933
Less: amounts representing interest………………… (5,706)
Present value of minimum lease payments………… $ 61,227
NOTE 8 – LONG-TERM DEBT
Under the provisions of Chapter 44, Section 10, Municipal Law authorizes indebtedness up to a limit of 5% of the
equalized valuation. Debt issued in accordance with this section of the law is designated as being "inside the
debt limit". In addition, however, debt may be authorized in excess of that limit for specific purposes. Such debt,
when issued, is designated as being "outside the debt limit".
In order to take advantage of favorable interest rates, the Town issued $6,120,612 of General Obligation
Refunding Bonds on May 1, 2011. The debt and premium proceeds were used to retire $6,290,000 of callable
bonds. The current refunding transaction resulted in an economic gain of $658,330 and a reduction of $762,611
in future debt service payments.
In May 2011, the Town also issued $7.5 million of new general obligation bonds. The proceeds of these bonds
were used to retire $6.2 million of maturing bond anticipation notes and to provide permanent financing for several
capital projects including $640,000 for Water system improvements, as well as $652,000 for other governmental
projects.
In prior fiscal years, certain general obligation bonds were defeased by placing the proceeds of bonds in an
irrevocable trust to provide for all future debt service payments on the refunded bonds. Accordingly, neither the
assets in escrow nor the liability for the defeased bonds are included in the Town’s financial statements. At June
30, 2011, $4,715,000 of bonds outstanding is considered defeased.
Town of Canton, Massachusetts 50 Comprehensive Annual Financial ReportSource page 58
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Details related to the outstanding indebtedness at June 30, 2011, and the debt service requirements are as
follows:
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2010 Issued Redeemed 2011
Building remodeling………………………………… 3.50-5.00% $ 760,000 $ - $ 760,000 $ -
School project………………………………………… 3.50-5.00% 5,365,000 - 5,365,000 -
Drainage……………………………………………… 2.00-4.75% 150,000 - 15,000 135,000
Land acquisition……………………………………… 2.00-4.75% 1,226,065 - 166,200 1,059,865
School construction………………………………… 2.00-4.75% 14,000,000 - 1,000,000 13,000,000
Building remodeling………………………………… 2.00-4.75% 8,595,000 - 695,000 7,900,000
Energy conservation - school……………………… 2.00-4.75% 295,000 - 30,000 265,000
Departmental equipment…………………………… 2.00-4.75% 140,000 - 35,000 105,000
Refunding…………………………………………… 2.00-4.75% 2,105,230 - 267,680 1,837,550
ADA renovations……………………………………… 4.10% 1,331,000 - 92,000 1,239,000
Fire station…………………………………………… 4.10% 1,306,000 - 96,000 1,210,000
Revere fire station…………………………………… 4.10% 588,000 - 40,000 548,000
Fire engine…………………………………………… 3.90% 62,000 - 16,000 46,000
School remodeling…………………………………… 4.00% 212,000 - 17,000 195,000
Hansen school plumbing…………………………… 4.00% 105,000 - 9,000 96,000
Kennedy school boiler……………………………… 4.10% 222,000 - 16,000 206,000
School remodeling…………………………………… 4.00-4.10% 1,135,000 - 99,000 1,036,000
Highway truck………………………………………… 4.00% 82,000 - 17,000 65,000
Ladder truck………………………………………… 4.00% 360,000 - 60,000 300,000
Fire tanker truck……………………………………… 4.00% 175,000 - 30,000 145,000
Streetlights…………………………………………… 4.00% 196,000 - 33,000 163,000
Surface drain………………………………………… 4.10% 76,000 - 6,000 70,000
Land acquisition……………………………………… 3.50-4.00% 300,000 - 51,000 249,000
Building remodeling………………………………… 3.50-4.00% 348,000 - 52,000 296,000
School remodeling…………………………………… 3.50-4.00% 110,000 - 55,000 55,000
Outdoor recreational facility………………………… 3.50-3.85% 60,000 - 5,000 55,000
Departmental equipment…………………………… 3.50% 603,000 - 90,000 513,000
Building remodeling--School………………………… 3.50-4.00% 483,000 - 34,000 449,000
Dam construction…………………………………… 3.50% 268,000 - 40,000 228,000
Surface Drain………………………………………… 3.50-4.00% 130,000 - 10,000 120,000
Remodeling & Renovations………………………… 2.00-4.25% 3,270,000 - 262,000 3,008,000
General Obligation Bonds of 2010………………… 2.00-4.00% 1,087,261 - 105,261 982,000
General Obligation Bonds of 2011………………… 2.00-4.25% - 1,964,388 - 1,964,388
Refunding Bonds of 2011…………………………… 2.00-4.25% - 5,398,612 - 5,398,612
Total governmental bonds payable………………… 45,145,556 7,363,000 9,569,141 42,939,415
Add unamortized premium………………………… 361,224 - 47,461 313,763
Less unamortized loss on bond refunding, net….. (171,533) - (40,338) (131,195)
Total governmental bonds payable, net…………… $ 45,335,247 $ 7,363,000 $ 9,576,264 $ 43,121,983
Town of Canton, Massachusetts 51 Comprehensive Annual Financial ReportSource page 59
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Debt service requirements for principal and interest for Governmental bonds payable in future fiscal years are as
follows:
Fiscal Year Principal Interest Total
2012…………… $ 4,306,220 $ 1,517,514 $ 5,823,734
2013…………… 4,192,270 1,395,008 5,587,278
2014…………… 4,114,245 1,268,946 5,383,191
2015…………… 3,941,190 1,139,656 5,080,846
2016…………… 3,807,140 988,713 4,795,853
2017…………… 3,548,100 847,000 4,395,100
2018…………… 3,221,475 719,286 3,940,761
2019…………… 3,005,000 604,899 3,609,899
2020…………… 2,828,775 508,775 3,337,550
2021…………… 2,788,000 414,374 3,202,374
2022…………… 2,278,000 319,671 2,597,671
2023…………… 2,058,000 216,556 2,274,556
2024…………… 1,594,000 123,100 1,717,100
2025…………… 434,000 53,932 487,932
2026…………… 256,000 33,542 289,542
2027…………… 220,000 23,290 243,290
2028…………… 186,000 14,322 200,322
2029…………… 116,000 6,630 122,630
2030…………… 35,000 1,850 36,850
2031…………… 10,000 425 10,425
Totals……………$ 42,939,415 $ 10,197,489 $ 53,136,904
Bonds and Notes Payable Schedule – Water Enterprise Fund
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2010 Issued Redeemed 2011
Well…………………………………………………… 2.00-4.75% $ 990,000 $ - $ 70,000 $ 920,000
Refunding…………………………………………… 2.00-4.75% 295,715 - 33,600 262,115
Water Pipe…………………………………………… 4.10% 256,000 - 18,000 238,000
Water Main Replacement…………………………… 4.10% 538,000 - 36,000 502,000
Water………………………………………………… 3.50-4.00% 174,000 - 26,000 148,000
Well Field Development…………………………… 3.50-4.00% 173,000 - 26,000 147,000
Water Departmental Equipment…………………… 3.50% 305,000 - 44,000 261,000
Water Departmental Equipment…………………… 3.50% 150,000 - 25,000 125,000
Water Mains………………………………………… 3.50-4.00% 886,000 - 57,000 829,000
Water Treatment Improvements…………………… 2.00-4.25% 2,206,000 - 298,000 1,908,000
Water System Improvement………………………… 2.00-4.00% 4,676,568 - 248,568 4,428,000
MWRA………………………………………………… 0% - 410,000 - 410,000
Water System Improvement………………………… 2.40-4.25% - 5,170,000 - 5,170,000
Total water bonds payable………………………… 10,650,283 5,580,000 882,168 15,348,115
Less unamortized loss on bond refunding, net….. (18,028) - (3,387) (14,641)
Total water bonds payable, net……….…………… $ 10,632,255 $ 5,580,000 $ 878,781 $ 15,333,474
Town of Canton, Massachusetts 52 Comprehensive Annual Financial ReportSource page 60
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Debt service requirements for principal and interest for the water enterprise fund bonds payable in future fiscal
years are as follows:
Fiscal Year Principal Interest Total
2012…………… $ 1,121,135 $ 524,606 $ 1,645,741
2013…………… 1,051,675 495,490 1,547,165
2014…………… 984,440 467,475 1,451,915
2015…………… 981,960 439,784 1,421,744
2016…………… 980,465 418,315 1,398,780
2017…………… 935,735 369,526 1,305,261
2018…………… 847,315 337,024 1,184,339
2019…………… 845,000 307,962 1,152,962
2020…………… 844,390 280,014 1,124,404
2021…………… 788,000 254,284 1,042,284
2022…………… 747,000 229,337 976,337
2023…………… 742,000 203,303 945,303
2024…………… 741,000 176,246 917,246
2025…………… 676,000 148,615 824,615
2026…………… 624,000 123,154 747,154
2027…………… 570,000 99,066 669,066
2028…………… 569,000 76,146 645,146
2029…………… 569,000 53,152 622,152
2030…………… 475,000 30,156 505,156
2031…………… 255,000 10,838 265,838
Totals……………$ 15,348,115 $ 5,044,489 $ 20,392,604
Bonds and Notes Payable Schedule – Sewer Enterprise Fund
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2010 Issued Redeemed 2011
Sewer………………………………………………… 3.50-5.00% $ 825,000 $ - $ 825,000 $ -
Sewer………………………………………………… 2.00-4.75% 255,000 - 20,000 235,000
Refunding…………………………………………… 3.25-4.00% 2,232,990 - 247,520 1,985,470
Sewer I&I……………………………………………… 4.10% 444,000 - 30,000 414,000
Estey Way Sewer…………………………………… 4.10% 166,000 - 12,000 154,000
Wardwell Sewer……………………………………… 4.10% 166,000 - 13,000 153,000
MWRA………………………………………………… 0% 40,040 - 40,040 -
Sewer………………………………………………… 3.50-4.00% 80,000 - 5,000 75,000
SCADA System……………………………………… 2.00-3.00% 237,000 - 28,000 209,000
MWPAT……………………………………………… 2.00% 3,745,695 - - 3,745,695
Refunding Bonds of 2011…………………………… 2.00-4.25% - 722,000 - 722,000
Total sewer bonds payable………………………..… 8,191,725 722,000 1,220,560 7,693,165
Less unamortized loss on bond refunding, net….. (130,000) - (24,009) (105,991)
Total sewer bonds payable, net……….…………… $ 8,061,725 $ 722,000 $ 1,196,551 $ 7,587,174
Town of Canton, Massachusetts 53 Comprehensive Annual Financial ReportSource page 61
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Debt service requirements for principal and interest for the sewer enterprise fund bonds payable in future fiscal
years are as follows:
Fiscal Year Principal Interest Total
2012…………… $ 577,496 $ 210,972 $ 788,468
2013…………… 571,014 194,979 765,993
2014…………… 569,445 178,777 748,222
2015…………… 568,215 161,930 730,145
2016…………… 567,060 143,732 710,792
2017…………… 561,197 126,240 687,437
2018…………… 559,677 108,752 668,429
2019…………… 556,971 90,301 647,272
2020…………… 518,381 71,890 590,271
2021…………… 314,194 59,356 373,550
2022…………… 257,915 50,964 308,879
2023…………… 261,711 44,164 305,875
2024…………… 265,584 37,254 302,838
2025…………… 254,535 30,241 284,776
2026…………… 208,566 23,860 232,426
2027…………… 207,679 19,547 227,226
2028…………… 211,874 15,352 227,226
2029…………… 216,154 11,072 227,226
2030…………… 220,521 6,705 227,226
2031…………… 224,976 2,250 227,226
Totals……………$ 7,693,165 $ 1,588,334 $ 9,281,499
Bonds and Notes Payable Schedule – Ice Rink Enterprise Fund
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2010 Issued Redeemed 2011
Zamboni……………………………………………… 2.00-3.00% $ 72,000 $ - $ 12,000 $ 60,000
Town of Canton, Massachusetts 54 Comprehensive Annual Financial ReportSource page 62
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Debt service requirements for principal and interest for the ice rick enterprise fund bonds payable in future fiscal
years are as follows:
Fiscal Year Principal Interest Total
2012…………… $ 10,000 $ 1,520 $ 11,520
2013…………… 8,000 1,520 9,520
2014…………… 8,000 1,520 9,520
2015…………… 8,000 1,520 9,520
2016…………… 8,000 1,520 9,520
2017…………… 6,000 1,520 7,520
2018…………… 6,000 1,520 7,520
2019…………… 6,000 1,520 7,520
Totals……………$ 60,000 $ 12,160 $ 72,160
In a prior fiscal period Town borrowed $3,745,695 from the MWPAT for the water infrastructure projects under a
program where there is no principal subsidy and the interest rate is set at a below market rate. Management has
estimated that the value of the imputed future interest subsidy to be minimal and therefore no adjustment has
been made to recognize the imputed interest.
The Commonwealth has approved school construction assistance to the Town. The assistance program, which is
administered by the Massachusetts School Building Authority (MSBA), provides resources for future debt service
of general obligation school bonds outstanding. During fiscal year 2011, $483,915 of such assistance was
received. The Town will receive $4,907,695 in future fiscal years. Of this amount, $906,666 represents
reimbursement of long-term interest costs, and $4,001,029 represents reimbursement of approved construction
costs. Accordingly, a $4,001,029 intergovernmental receivable and corresponding deferred revenue have been
reported in the general fund. The net change in deferred revenue has been recognized as revenue in the
conversion to the government-wide financial statements.
Town of Canton, Massachusetts 55 Comprehensive Annual Financial ReportSource page 63
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
The Town is subject to various debt limits by statute and may issue additional general obligation debt under the
normal debt limit. At June 30, 2011, the Town had the following authorized and unissued debt:
Purpose Amount
ADA Renovation………………………………$ 50,000
Ambulance Management System…………… 40,000
Ambulance Replacement…………………… 6,739
Bolivar & Pine Street Culverts……………… 581,000
Dedham Street Drainage…………………..… 50,000
DPW Dump Truck…………………………… 4,650
DPW Garage…………………….…………… 150,000
Fiber Cables…………………………………… 25,000
Fire Air Compressor………………………… 47,400
Fire Department Equipment………………… 2,000
GMS Acoustic Panels………………………… 2,850
Greenlodge Street Interceptor……………… 3,254,305
High School Roof Repair…………………… 294,000
JFK School Space Needs/Modular………… 899,000
Kennedy School Addition Supplement…… 364,000
Luce School Roof Replacement…………… 95,000
Memorial Hall Insulation……………………… 35,000
Middle School Roof Replacement………… 30,000
Municipal Performance Contracting………… 848,908
Ponkapoag Fire Station Roof Repairs……… 20,000
Ponkapoag Standpipe Repairs……………… 500,000
Recreation Truck……………………………… 30,000
Rodman Building Asbestos Removal……… 20,000
Rodman Building Boiler Replacement……… 130,000
Rodman Building Heating System………… 1,500,000
Rodman Building Roof Replacement……… 347,000
Scada Upgrade & Trucks…………………… 295,000
School HVAC………………………………… 146,000
School Plumbing……………………………… 118,000
Senior Center ………………………………… 450,000
Septic Title V………………………………… 200,000
Sewer Infiltration & Inflow…………………… 1,586,290
Shepards Pond Dam………………………… 175,000
Washington Street Culvert Design………… 60,000
Water Resource Management Plan………… 100,000
Water System Improvements……………… 3,910,000
Water Treatment Facility …………………… 3,800,000
Water Trucks………………………………… 9,432
Well # 10 Repairs…………………………… 187,000
Total……………………………………………$ 20,363,574
Town of Canton, Massachusetts 56 Comprehensive Annual Financial ReportSource page 64
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Changes in long-term liabilities
During the fiscal year ended June 30, 2011, the following changes occurred in long-term liabilities:
Beginning Ending Current
Balance Additions Reductions Balance Portion
Governmental Activities:
Long-term bonds and notes……………………$ 45,145,556 $ 7,363,000 $ (9,569,141) $ 42,939,415 $ 4,306,220
Unamortized premium on bonds payable…… 361,224 - (47,461) 313,763 44,855
Unamortized deferred loss on refunding…… (171,533) - 40,338 (131,195) (35,001)
Other postemployment benefits……………… 12,363,000 11,325,000 (4,251,000) 19,437,000 -
Landfill closure………………………………… 242,000 - (58,000) 184,000 30,000
Capital lease obligations……………………… 41,097 62,192 (42,062) 61,227 40,529
Compensated absences……………………… 1,238,000 759,000 (796,000) 1,201,000 808,000
Total governmental activities………………… $ 59,219,344 $ 19,509,192 $ (14,723,326) $ 64,005,210 $ 5,194,603
Business-Type Activities:
Long-term bonds and notes……………………$ 18,914,008 $ 6,302,000 $ (2,114,728) $ 23,101,280 $ 1,708,631
Unamortized deferred loss on refunding…… (148,028) - 27,396 (120,632) (24,796)
Other postemployment benefits……………… 530,000 285,000 (11,000) 804,000 -
Compensated absences……………………… 183,000 74,000 (94,000) 163,000 94,000
Total business-type activities………………… $ 19,478,980 $ 6,661,000 $ (2,192,332) $ 23,947,648 $ 1,777,835
The governmental activities liabilities will be liquidated by the general fund with the exception of the workers’
compensation liability which was liquidated by the internal service fund. The business-type liabilities will be
liquidated by the enterprise fund reporting the liability.
Town of Canton, Massachusetts 57 Comprehensive Annual Financial ReportSource page 65
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
NOTE 9 – GOVERNMENTAL FUND BALANCE CLASSIFICATIONS
In fiscal year 2011, the Town implemented GASB Statement No. 54, Fund Balance Reporting and Governmental
Fund Type Definitions. The intention of the GASB is to provide a more structured classification of fund balance
and to improve the usefulness of fund balance reporting to the users of the Town’s financial statements. The
reporting standard establishes a hierarchy for fund balance classifications and the constraints imposed on the
uses of those resources.
In accordance with Statement No. 54, the stabilization funds, previously reported as a non-major governmental
fund, have been reported in the general fund, and accordingly, the general fund and non-major governmental
funds beginning balances have been revised from $10,158,471 to $13,392,683 and from $10,218,486 to
$6,984,274, respectively.
At June 30, 2011, $3,463,814 has been set aside in a stabilization fund that is classified as part of the general
fund unassigned fund balance in the governmental funds financial statements. Massachusetts General Law
Ch.40 §5B allows for the establishment of Stabilization funds for one or more different purposes on an as needed
basis. The creation of a fund requires a two-thirds vote of the legislative body and must clearly define the
purpose of the fund. Any change to the purpose of the fund along with any additions to or appropriations from the
fund requires a two-thirds vote of the legislative body. The stabilization fund balance can be used for general
and/or capital purposes upon approval of Town Meeting. Additions to and withdrawals from the funds can only be
made upon Town Meeting approval.
GASB 54 provides for two major types of fund balances, which are nonspendable and spendable. Nonspendable
fund balances are balances that cannot be spent because they are not expected to be converted to cash or they
are legally or contractually required to remain intact. Examples of this classification are prepaid items, inventories
and principal (corpus) of an endowment fund. The Town has reported principal portions of endowment funds as
nonspendable.
In addition to the nonspendable fund balance, GASB 54 has provided a hierarchy of spendable fund balances,
based on a hierarchy of spending constraints.
• Restricted: fund balances that are constrained by external parties, constitutional provisions, or enabling
legislation.
• Committed: fund balances that contain self-imposed constraints of the government from its highest level
of decision making authority.
• Assigned: fund balances that contain self-imposed constraints of the government to be used for a
particular purpose.
• Unassigned: fund balance of the general fund that is not constrained for any particular purpose.
The Town has classified its fund balances with the following hierarchy:
Town of Canton, Massachusetts 58 Comprehensive Annual Financial ReportSource page 66
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
GOVERNMENTAL FUNDS
Nonmajor Total
Governmental Governmental
General Funds Funds
FUND BALANCES
Nonspendable:
Cemetery trust funds……………………………$ - $ 360,597 $ 360,597
Library trust funds……………………………… - 21,553 21,553
Other municipal trust funds…………………… - 12,235 12,235
Restricted for:
MSBA grant……………………………………… 6,033,902 - 6,033,902
School lunch…………………………………… - 337,672 337,672
Private grants…………………………………… - 1,415,959 1,415,959
Town revolving………………………………… - 254,609 254,609
School revolving………………………………… - 763,940 763,940
Recreation……………………………………… - 30,074 30,074
Ambulance……………………………………… - 1,126,614 1,126,614
Town grants…………………………………… - - -
School grants…………………………………… - 67,719 67,719
Roadway improvements……………………… - 2,120 2,120
Other departmental…………………………… - 1,771,616 1,771,616
Public works improvements…………………… - 77,813 77,813
High school construction……………………… - 67,324 67,324
Cemetery trust funds…………………………… - 16,332 16,332
Library trust funds……………………………… - 157,121 157,121
Other municipal trust funds…………………… - 415,793 415,793
Assigned to:
General government…………………………… 215,403 - 215,403
Public safety…………………………………… 164,188 - 164,188
Education………………………………………… 308,365 - 308,365
Public works…………………………………… 627,266 - 627,266
Culture and recreation………………………… 13,373 - 13,373
Free cash used for rate stabilization………… 40,000 - 40,000
Unassigned……………………………………….. 5,825,529 (1,301,454) 4,524,075
TOTAL FUND BALANCES (DEFICIT)………………$ 13,228,026 $ 5,597,637 $ 18,825,663
Town of Canton, Massachusetts 59 Comprehensive Annual Financial ReportSource page 67
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
NOTE 10 – RISK FINANCING
The Town is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors
and omissions; and natural disasters for which the Town carries commercial insurance. The amount of claim
settlements has not exceeded insurance coverage in any of the previous three years.
The Town is self-insured for its health insurance and workers’ compensation activities. These activities are
accounted for in the Town’s internal service funds where revenues are recorded when earned and expenses are
recorded when the liability is incurred.
(a) Health Insurance
The estimate of Incurred But Not Reported (IBNR) claims based on historical claims paid averages for
twelve months prior to fiscal year-end. The Town purchases individual stop loss insurance for claims in
excess of the coverage provided by the Town in the amount of $100,000. At June 30, 2011, the amount
of the liability for health insurance claims totaled $820,000. This liability is the best estimate based on
available information. Changes in the reported liability since July 1, 2009, are as follows:
Current Year
Balance at Claims and Balance at
Beginning of Changes in Claims Fiscal Current
Fiscal Year Estimate Payments Year-End Portion
Fiscal Year 2011…………$ 1,336,000 $ 11,021,686 $ (11,537,686) $ 820,000 $ 820,000
Fiscal Year 2010………… 1,220,000 12,221,322 (12,105,322) 1,336,000 1,336,000
(b) Workers’ Compensation
Workers’ compensation claims submitted prior to July 1, 2008 are administered by a third party
administrator and are funded on a pay-as-you-go basis from annual appropriations. The Town is
premium based for all claims after July 1, 2008. The Town purchases individual stop loss insurance in
excess of the coverage provided in the amount of $300,000. The estimated future workers’
compensation liability is based on history and injury type.
Changes in the reported liability since July 1, 2009, are as follows:
Current Year
Balance at Claims and Balance at
Beginning of Changes in Claims Fiscal Current
Fiscal Year Estimate Payments Year-End Portion
Fiscal Year 2011…………$ - $ - $ - $ - $ -
Fiscal Year 2010………… 115,000 (109,095) (5,905) - -
Town of Canton, Massachusetts 60 Comprehensive Annual Financial ReportSource page 68
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 NOTE 11 – PENSION PLAN Plan Description - The Town contributes to the System, a cost-sharing multiple-employer defined benefit pension plan administered by the Norfolk County Retirement Board (Board). Substantially all employees are members of the System, except for public school teachers and certain administrators who are members of the Massachusetts Teachers Retirement System, to which the Town does not contribute. Pension benefits and administrative expenses paid by the Teachers Retirement Board are the legal responsibility of the Commonwealth. The amount of these on-behalf payments totaled approximately $8,128,000 for the fiscal year ended June 30, 2011, and, accordingly, are reported in the general fund as intergovernmental revenues and pension expenditures. The System provides retirement, disability and death benefits to plan members and beneficiaries. Chapter 32 of the MGL assigns authority to establish and amend benefit provisions of the plan. Cost-of-living adjustments granted between 1981 and 1997 and any increase in other benefits imposed by the Commonwealth’s state law during those years are borne by the Commonwealth and are deposited into the pension fund. Cost-of-living adjustments granted after 1997 must be approved by the Norfolk County Retirement Board and are borne by the System. The System issues a publicly available unaudited financial report in accordance with guidelines established by the Commonwealth’s PERAC. That report may be obtained by contacting the System located at 480 Neponset Street, Building #15, P.O. Box 188, Canton, Massachusetts 02021-0188. Funding Policy - Plan members are required to contribute to the System at rates ranging from 5% to 11% of annual covered compensation. The Town is required to pay into the System its share of the system-wide actuarial determined contribution that is apportioned among the employers based on active current payroll. Administrative expenses are funded through investment earnings. Chapter 32 of the MGL governs the contributions of plan members and the Town. Annual Pension Cost - The Town’s contributions to the System for the fiscal years ended June 30, 2011, 2010, and 2009, were $2,933,187, $2,826,638 and $2,672,418, respectively, which equaled its required contribution for each fiscal year. NOTE 12 – LANDFILL POSTCLOSURE CARE COSTS State and Federal laws and regulations require the Town to perform certain maintenance and monitoring functions at the site after closure. The Town has closed the landfill and has recorded its estimated postclosure care costs to be $184,000 which has been recorded as a governmental activity liability at June 30, 2011. Actual costs may be higher due to inflation, changes in technology or changes in regulations. NOTE 13 – POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS Plan Description – The Town of Canton administers a single-employer defined benefit healthcare plan (“the Retiree Health Plan”). The plan provides lifetime healthcare insurance for eligible retirees and their spouses through the Town’s group health insurance plan, which covers both active and retired members. Chapter 32B of the MGL assigns authority to establish and amend benefit provisions of the plan. Benefit provisions are negotiated between the Town and the unions representing Town employees and are renegotiated each bargaining period. The Retiree Health Plan does not issue a publicly available financial report. Town of Canton, Massachusetts 61 Comprehensive Annual Financial Report
Source page 69
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
Funding Policy – Contribution requirements are also negotiated between the Town and union representatives.
The required contribution is based on a pay-as-you-go financing requirement. The Town contributes 75 percent
of the cost of current-year premiums for eligible retired plan members and their spouses. Plan members receiving
benefits contribute the remaining 25 percent of their premium costs. For fiscal year 2011, the Town contributed
$4.3 million to the plan.
Annual OPEB Cost and Net OPEB Obligation – The Town’s annual other postemployment benefit (OPEB) cost
(expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding
that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded
actuarial liabilities (or funding excess) over a period not to exceed thirty years. The components of the Town’s
annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the Town’s net OPEB
obligation are summarized in the following table:
Annual required contribution……………………………………$ 11,585,000
Interest on net OPEB obligation……………………………… 548,000
Adjustments to annual required contribution………………… (523,000)
Annual OPEB cost (expense)……………………………… 11,610,000
Contributions made……………………………………………… (4,262,000)
Increase in net OPEB obligation……………………………… 7,348,000
Net OPEB obligation - beginning of year (restated)………… 12,893,000
Net OPEB obligation - end of year…………………………… $ 20,241,000
The Net OPEB obligation at the beginning of the year was previously understated by $6,772,000. This
understatement was discovered by management during the current year and is attributable to certain participants
that were coded under a retiree plan rather than an active plan in the prior actuarial valuation. Accordingly, an
adjustment has been made in this report to restate net assets of the Primary Government as of June 30, 2010
from $97,661,054 to $90,889,054.
The Town’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB
obligation for fiscal year 2011 and the preceding year is as follows:
Percentage of
Fiscal Year Annual Annual OPEB Net OPEB
Ended OPEB Cost Cost Contributed Obligation
6/30/2011 $ 11,610,000 37% $ 20,241,000
6/30/2010 11,431,000 42% 12,893,000
6/30/2009 10,717,000 41% 6,304,000
Funded Status and Funding Progress – As of January 1, 2011, the most recent actuarial valuation date, the
actuarial accrued liability for benefits was $130.9 million, all of which was unfunded. The covered payroll (annual
payroll of active employees covered by the plan) was $34.4 million, and the ratio of the UAAL to the covered
payroll was 380.3 percent.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions
about the probability of occurrence of events far into the future. Examples include assumptions about future
Town of Canton, Massachusetts 62 Comprehensive Annual Financial ReportSource page 70
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011 employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the plan and the annual required contributions of the employer are subject to continual revision as actual results are compared with past expectations and new estimates are made about the future. The schedule of funding progress, presented as required supplementary information following the notes to the financial statements, presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing over time relative to the actuarial accrued liabilities for benefits. Actuarial Methods and Assumptions – Projections of benefits for financial reporting purposes are based on the substantive plan (the plan as understood by the employer and the plan members) and include the types of benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the employer and plan members to that point. The actuarial methods and assumptions used include techniques that are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of assets, consistent with the long-term perspective of the calculations. In the January 1, 2011 actuarial valuation, actuarial liabilities were determined using the projected unit credit cost method. The actuarial assumptions included a 4.25% investment return assumption, which is based on the expected yield on the assets of the Town, calculated based on the funded level of the plan at the valuation date, and an annual medical/drug cost trend rate of 10% initially, graded to 5% over ten years and included a 3.5% inflation assumption. The UAAL is being amortized over a 28 year period, with amortization payments increasing at 3.25% per year on a closed basis. The amortization method utilizes a level dollar amount. The remaining amortization period at June 30, 2011 is 27 years. NOTE 14 – COMMITMENTS During fiscal year 2011 the Town began construction on a second Water Treatment Facility. As of June 30, 2011, the Town has outstanding contracts totaling approximately $4.4 million relating to the project. In addition, the Town also has outstanding contracts totaling approximately $2.6 million related to various water and sewer system improvement projects. These projects are all anticipated to be completed during fiscal year 2012. NOTE 15 – CONTINGENCIES The Town participates in a number of federal award programs. Although the grant programs have been audited in accordance with the provisions of the Single Audit Act Amendments of 1996 through June 30, 2011, these programs are still subject to financial and compliance audits. The amount, if any, of expenditures which may be disallowed by the granting agencies cannot be determined at this time, although it is expected such amounts, if any, to be immaterial. Various legal actions and claims are pending. Litigation is subject to many uncertainties, and the outcome of individual litigated matters is not always predictable. Although the amount of liability, if any, at June 30, 2011, cannot be ascertained, management believes any resulting liability should not materially affect the financial position at June 30, 2011. Town of Canton, Massachusetts 63 Comprehensive Annual Financial Report
Source page 71
Notes to Basic Financial Statements Fiscal Year Ended June 30, 2011
NOTE 16 – IMPLEMENTATION OF NEW GASB PRONOUNCEMENTS
During fiscal year 2011, the following GASB pronouncements were implemented:
• The GASB issued Statement #54, Fund Balance Reporting and Governmental Fund Type Definitions,
which was required to be implemented in fiscal year 2011. This pronouncement required additional
disclosures and impacted the basic financial statements.
• The GASB issued Statement #59, Financial Instruments Omnibus. The objective of this Statement is to
update and improve existing standards regarding financial reporting and disclosure requirements of
certain financial instruments and external investment pools for which significant issues have been
identified in practice. The provisions of this Statement are effective for financial statements for periods
beginning after June 15, 2010.
Other Future GASB Pronouncements:
• The GASB issued Statement #60, Accounting and Financial Reporting for Service Concession
Arrangements, which is required to be implemented in fiscal year 2013. Management expects that the
implementation of this pronouncement will have an impact on the basic financial statements.
• The GASB issued Statement #61, The Financial Reporting Entity: Omnibus, which is required to be
implemented in fiscal year 2013. Management’s current assessment is that this pronouncement will not
have a significant impact on the basic financial statements.
• The GASB issued Statement #62, Codification of Accounting and Financial Reporting Guidance
Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements, which is required to be
implemented in fiscal year 2013. Management’s current assessment is that this pronouncement will not
have a significant impact on the basic financial statements.
• The GASB issued Statement #63, Financial Reporting of Deferred Outflows of Resources, Deferred
Inflows of Resources, and Net Position, which is required to be implemented in fiscal year 2013.
Management’s current assessment is that this pronouncement will have a significant impact on the basic
financial statements.
• The GASB issued Statement #64, Derivative Instruments: Application of Hedge Accounting Termination
Provisions, an amendment of GASB Statement No. 53, which is required to be implemented in fiscal year
2012. Management does not believe that this pronouncement will require additional disclosure or impact
the basic financial statements.
Town of Canton, Massachusetts 64 Comprehensive Annual Financial ReportSource page 72
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Source page 73
Required Supplementary Information Required Supplementary Information Town of Canton, Massachusetts 66 Comprehensive Annual Financial Report
Source page 74
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE -
BUDGET AND ACTUAL
FISCAL YEAR ENDED JUNE 30, 2011
Budgeted Amounts
Actual Amounts Variance
Original Final Budgetary Carried Forward to Final
Budget Budget Amounts To Next Year Budget
REVENUES:
Real estate and personal property taxes,
net of tax refunds…………………………………………… $ 55,544,530 $ 55,544,530 $ 55,119,110 $ - $ (425,420)
Tax liens……………………………………………………… - - 224,631 - 224,631
Motor vehicle and other excise taxes……………………… 3,000,000 3,000,000 3,289,549 - 289,549
Penalties and interest on taxes……………………………… 200,000 200,000 305,814 - 105,814
Payments in lieu of taxes…………………………………… 201,363 201,363 199,225 - (2,138)
Licenses and permits………………………………………… 510,000 510,000 646,450 - 136,450
Fines and forfeitures………………………………………… 150,000 150,000 145,599 - (4,401)
Intergovernmental…………………………………………… 7,109,660 7,109,660 6,755,632 - (354,028)
Departmental and other……………………………………… 425,000 425,000 500,802 - 75,802
Investment income…………………………………………… 150,000 150,000 115,323 - (34,677)
TOTAL REVENUES…………………………………… 67,290,553 67,290,553 67,302,135 - 11,582
EXPENDITURES:
Current:
General Government
Executive Branch………………………………………… 816,246 841,246 840,874 - 372
Executive Branch articles……………………………… 59,800 59,800 - 59,800 -
Finance Committee……………………………………… 11,500 11,500 9,558 - 1,942
Reserve Fund…………………………………………… 300,000 - - - -
Finance Department…………………………………… 932,953 932,953 864,563 60,201 8,189
Finance Department articles…………………………… 83,247 83,247 66,343 16,904 -
Assessors………………………………………………… 244,099 244,099 231,796 9,500 2,803
Water/Sewer Rate Committee………………………… 1,000 1,000 - - 1,000
Town Clerk & Elections………………………………… 195,395 201,395 200,592 - 803
Town Clerk & Elections articles………………………… 42,500 42,500 - 42,500 -
Conservation Commission……………………………… 68,431 68,431 66,485 1,853 93
Planning Board…………………………………………… 57,371 57,371 54,121 1,250 2,000
Building Renovation Committee……………………… 3,381 3,381 237 - 3,144
Capital Outlay Committee……………………………… 2,556 2,556 256 - 2,300
Municipal Buildings……………………………………… 438,918 363,918 363,573 - 345
Municipal Buildings articles…………………………… 38,758 38,758 12,328 23,395 3,035
Town Insurance………………………………………… 765,000 765,000 736,579 - 28,421
Total……………………………………………………… 4,061,155 3,717,155 3,447,305 215,403 54,447
Public Safety
Fire Department………………………………………… 4,441,485 4,523,485 4,475,879 1,416 46,190
Fire Department articles………………………………… 33,000 33,000 31,933 - 1,067
Police……………………………………………………… 3,817,920 3,904,920 3,898,933 - 5,987
Police articles…………………………………………… 237,110 237,110 82,605 154,505 -
Building & Zoning………………………………………… 328,959 328,959 314,019 8,267 6,673
Sealer of Weights & Measures………………………… 7,500 7,500 6,750 - 750
Emergency Management……………………………… 2,335 3,335 3,331 - 4
Animal Control…………………………………………… 122,082 122,082 89,491 - 32,591
Total……………………………………………………… 8,990,391 9,160,391 8,902,941 164,188 93,262
Education
School…………………………………………………… 30,538,972 30,538,972 30,234,229 304,742 1
School articles…………………………………………… 58,873 58,873 55,250 3,623 -
Blue Hills Regional……………………………………… 1,387,713 1,460,438 1,460,438 - -
Total……………………………………………………… 31,985,558 32,058,283 31,749,917 308,365 1
(Continued)
Town of Canton, Massachusetts 67 Comprehensive Annual Financial ReportSource page 75
GENERAL FUND
SCHEDULE OF REVENUES, EXPENDITURES AND CHANGES IN FUND BALANCE -
BUDGET AND ACTUAL
FISCAL YEAR ENDED JUNE 30, 2011
Budgeted Amounts
Actual Amounts Variance
Original Final Budgetary Carried Forward to Final
Budget Budget Amounts To Next Year Budget
Public Works
Public Works……………………………………………… 1,999,355 1,999,355 1,991,310 4,232 3,813
Public Works articles…………………………………… 29,738 29,738 6,519 23,219 -
Street Lighting…………………………………………… 224,317 179,317 129,292 6,693 43,332
Snow & Ice……………………………………………… 184,721 809,721 720,896 26,877 61,948
Trash Collection………………………………………… 1,469,695 1,429,695 1,360,331 66,245 3,119
Total……………………………………………………… 3,907,826 4,447,826 4,208,348 127,266 112,212
Health and Human Services
Health Department……………………………………… 320,962 320,962 308,463 - 12,499
Council on Aging………………………………………… 202,962 202,962 202,916 - 46
Commission on Disability……………………………… 2,565 2,565 51 - 2,514
Veteran's Services……………………………………… 129,390 189,390 187,663 - 1,727
Total……………………………………………………… 655,879 715,879 699,093 - 16,786
Culture and Recreation
Recreation & Playground……………………………… 382,272 391,272 391,218 - 54
Recreation & Playground articles……………………… 92,928 92,928 88,227 4,497 204
Public Library…………………………………………… 978,292 978,292 978,269 - 23
Public Library articles…………………………………… 24,259 24,259 15,702 8,151 406
Historical Commission…………………………………… 3,669 3,669 2,944 725 -
Beautification Commission……………………………… 1,378 1,378 1,030 - 348
Total……………………………………………………… 1,482,798 1,491,798 1,477,390 13,373 1,035
Pension Benefits…………………………………………… 2,981,987 2,981,987 2,976,696 - 5,291
Employee Benefits
Unemployment Compensation………………………… 100,000 100,000 100,000 - -
Employer Share - Health……………………………… 9,736,797 9,817,397 9,814,771 - 2,626
Employer Share - Life…………………………………… 58,680 58,680 58,666 - 14
Total……………………………………………………… 9,895,477 9,976,077 9,973,437 - 2,640
State and county charges…………………………………… 933,118 933,118 849,149 - 83,969
Debt service…………………………………………………… 6,112,415 5,869,178 5,868,118 - 1,060
TOTAL EXPENDITURES……………………………… 71,006,604 71,351,692 70,152,394 828,595 370,703
EXCESS (DEFICIENCY) OF REVENUES
OVER EXPENDITURES……………………………………… (3,716,051) (4,061,139) (2,850,259) (828,595) 382,285
OTHER FINANCING SOURCES (USES):
Premium from issuance of bonds…………………………… - - 33,983 - 33,983
Transfers in…………………………………………………… 1,951,336 2,641,336 2,630,410 - (10,926)
Transfers out………………………………………………… (280,000) (434,912) (434,912) - -
TOTAL OTHER FINANCING SOURCES (USES)…… 1,671,336 2,206,424 2,229,481 - 23,057
NET CHANGE IN FUND BALANCE…………………………… (2,044,715) (1,854,715) (620,778) (828,595) 405,342
BUDGETARY FUND BALANCE, Beginning of year………… 13,873,405 10,639,193 10,639,193 - -
BUDGETARY FUND BALANCE, End of year…………………$ 11,828,690 $ 8,784,478 $ 10,018,415 $ (828,595) $ 405,342
(Concluded)
See notes to required supplementary information.
Town of Canton, Massachusetts 68 Comprehensive Annual Financial ReportSource page 76
Retirement System Schedules of Funding
Progress and Employer Contributions
The Retirement System Schedule of Funding Progress presents multiyear trend information about whether the
actuarial value of planned assets is increasing or decreasing over time relative to the actuarial accrued liability for
benefits.
The Retirement System Schedule of Employer Contributions presents multiyear trend information for required and
actual contributions relating to the cost-sharing plan as a whole, of which the Town is one participating employer,
was well as the Town’s proportionate share of the plan’s annual contributions.
Retirement System Schedules
Town of Canton, Massachusetts 69 Comprehensive Annual Financial ReportSource page 77
Norfolk County Contributory Retirement System
SCHEDULE OF FUNDING PROGRESS
JUNE 30, 2011
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability (AAL) AAL Funded Covered of Covered
Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll
Date (A) (B) (B-A) (A/B) (C) ((B-A)/C)
01/01/10 $ 600,790,835 $ 1,001,881,055 $ 401,090,220 60.0% $ 223,332,595 179.6%
01/01/08 596,157,147 907,719,124 311,561,977 65.7% 223,814,977 139.2%
01/01/07 533,077,948 855,677,413 322,599,465 62.3% 219,620,865 146.9%
01/01/05 467,186,566 762,900,650 295,714,084 61.2% 196,639,163 150.4%
01/01/03 415,150,776 675,275,257 260,124,481 61.5% 185,281,985 140.4%
01/01/00 371,646,793 533,959,970 162,313,177 69.6% 163,542,978 99.2%
01/01/97 258,771,070 392,463,080 133,692,010 65.9% 126,219,194 105.9%
01/01/93 151,546,609 291,472,940 139,926,331 52.0% 107,482,975 130.2%
The Town's share of the UAAL, as of January 1, 2010, is approximately 7.2%.
See notes to required supplementary information.
Town of Canton, Massachusetts 70 Comprehensive Annual Financial ReportSource page 78
Norfolk County Contributory Retirement System
SCHEDULE OF EMPLOYER CONTRIBUTIONS
FISCAL YEAR ENDED JUNE 30, 2011
System Wide Town of Canton
(B/A)
Fiscal Year Annual (A) (B) Town's Percentage
Ended Required Actual Percentage Actual of System Wide
June 30 Contributions Contributions Contributed Contributions Actual Contributions
2011 $ 39,749,857 $ 39,749,857 100% $ 2,992,977 7.53%
2010 41,242,373 41,242,373 100% 2,826,638 6.85%
2009 38,920,499 38,920,499 100% 2,672,418 6.87%
2008 33,104,903 33,104,903 100% 2,297,249 6.94%
2007 32,877,890 32,877,890 100% 2,201,571 6.70%
2006 31,755,708 31,755,708 100% 2,017,098 6.35%
2005 28,238,996 28,238,996 100% 1,747,497 6.19%
The Town's Actual Contributions equaled 100% of its Required Contribution for each year presented.
See notes to required supplementary information.
Town of Canton, Massachusetts 71 Comprehensive Annual Financial ReportSource page 79
Other Postemployment Benefits Plan
Schedules
The Schedule of Funding progress compares, over time, the actuarial accrued liability for benefits with the
actuarial value of accumulated plan assets.
The Schedule of Employer Contributions compares, over time, the Annual Required Contributions to the Actual
Contributions made.
The Schedule of Actuarial Methods and Assumptions presents factors that significantly affect the identification of
trends in the amounts reported.
Town of Canton, Massachusetts 72 Comprehensive Annual Financial ReportSource page 80
OTHER POSTEMPLOYMENT BENEFIT PLAN
SCHEDULE OF FUNDING PROGRESS AND EMPLOYER CONTRIBUTIONS
JUNE 30, 2011
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability (AAL) AAL Funded Covered of Covered
Valuation Assets Projected Unit Credit (UAAL) Ratio Payroll Payroll
Date (A) (B) (B-A) (A/B) (C) ((B-A)/C)
1/1/2011 $ - $ 130,885,000 $ 130,885,000 0% $ 34,416,000 380.3%
1/1/2009 - 138,978,000 138,978,000 0% 32,236,000 431.1%
Schedule of Employer Contributions
Fiscal Annual Actual Percentage of
Year Required Contributions the ARC
Ended Contribution (ARC) Made Contributed
2011 $ 11,585,000 $ 4,262,000 37%
2010 11,388,000 4,842,000 43%
2009 10,717,000 4,413,000 41%
See notes to required supplementary information.
Town of Canton, Massachusetts 73 Comprehensive Annual Financial Report