Utility Fund Accounting Overview

Question 1

A shortcoming in Utility Fund must be raised in the _______ _______.

Answer 1

Current budget

Question 2

A surplus in the Utility Fund SHALL be included in ______ ______

Answer 2

Current budget

Question 3

Deemed to be self liquidating if cash receipts from fees, rents, and other charges are sufficient to meet what?

Answer 3

Operating and maintenance expenses &

Interest and debt redemption charges

Question 4

Utility with BPU oversight has a ____% surplus limit

Answer 4

5%

Question 5

Self liquidating debt calculation done annually on _______ _______ ________.

Answer 5

Annual Debt Statement

Question 6

When is Annual Debt Statement due?

Answer 6

January 31

Question 7

Calculation of new debt is done on _____ _____ _____.

Answer 7

Supplemental Debt Statement

Question 8

Unlike Current Fund, Utilities accrue _______.

Answer 8

Interest

Question 9

Interest Accrual as of 12/31 is shown on ________.

Answer 9

Utility Operating Balance Sheet

Question 10

Shortfall in Interest Accrual must be appropriated in _____ _____.

Answer 10

Operating budget

Question 11

Information needed to calculate the interest accrual is found in the _____ _____.

Answer 11

Capital Fund

Question 12

A shortcoming in Utility must be raised in ____ ____.

Answer 12

Current Fund

Question 13

Utility Budgets are NOT subject to the provisions of what?

Answer 13

The budget CAP laws

Question 14

What are the three different Utility funds?

Answer 14

Utility Operating Fund

Utility Capital Fund

Utility Assessment Fund

Question 15

Name components of the Utility Operating Fund

Answer 15

General Revenues
Operating Expenses
Capital Improvement Fund
Debt Service Appropriations

Question 16

Name components of the Utility Capital Fund

Answer 16

Debt Authorized
Bonds
Notes
Capital Appropriations
Capital Assets

Question 17

Name components of the Utility Assessment Fund

Answer 17

Assessments Receivable

Assessment Debt

Question 18

Name types of Utilities

Answer 18

Water
Sewer
Electric
Solid Waste
Parking
Pool
Recreation

Question 19

A Utility is created by _____.

Answer 19

The adoption of an Ordinance by the Governing Body

Question 20

Once a Utility is created, a _______ is set up to record the financial activity.

Answer 20

Chart of Accounts

Question 21

An ______ may be required if commitments are to be made before the Utility Budget can be adopted.

Answer 21

Emergency Appropriation

Question 22

If cash receipts from fees, rents and other charges are sufficient to meet operating and maintenance expenses and interest and debt redemption charges, a Utility is deemed to be ______.

Answer 22

Self-liquidating

Question 23

A Utility Debt is a Deduction from _____.

Answer 23

Net Debt

Question 24

If Utility will remain self liquidating with new debt, no _____ is required for Debt Authorizations.

Answer 24

Down Payment

Question 25

A Utility can be Self Liquidating during Construction with approval of _______.

Answer 25

Local Finance Board

Question 26

List Operating Liabilities:

Answer 26

``` Appropriations Appropriation Reserves (Prior Year Budget) Reserve for Encumbrances Accounts Payable Interfund Payable Accrued Interest on Bonds & Notes Utility Overpayments Pre-Paid Rents Reserve for Consumer Accounts Rec Reserve for Liens; Other A/R Fund Balance ```

Question 27

Give 5 reasons a town would want to set up a Utility

Answer 27

1. No Down Payment on Debt 2. No Levy CAP 3. No Appropriation CAP 4. User Base is Limited 5. Use Base includes exempt properties 6. Match Program Costs to Users

Question 28

What is the difference between a Utility and an Authority?

Answer 28

- Utility is owned by Local Government, Authority is owned by an autonomous agency - Local Government Body oversees Utility, Appointed Board of Directors oversees Authority - Utility is created by Ordinance, Authority is created by Ordinance w/ prior approval of Local Finance Board - Utility is funded as part of Municipal Budget, Authority has an independent budget

Question 29

Factors to consider when creating Utility Rate Structure:

Answer 29

Actual Revenue vs Actual Expenses for 2-3 years prior Review CY Revenue & Expenses vs Budget Project expenses going forward Divide Annual Projected expenses by the number of Utility Units Determine assumptions for various types of expenses

Question 30

Is a Utility required by statute to be self-liquidating?

Answer 30

No