SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) NOTE 1
receivables to be delinquent when they become greater than 90 days past due. As of June 30, 2024, management believes all intergovernmental and intergovernmental financing lease receivables are collectible, and, as such, no allowance for doubtful accounts has been recorded. Investments Investments are carried at fair value with all income, including unrealized changes in the fair value of investments, reported as interest and other investment income in the accompanying financial statements. The MDTA’s Trust Agreement defines the types of securities authorized as appropriate investments for the MDTA and conditions for making investment transactions. Investment transactions may be conducted only through authorized financial dealers and institutions. Inventory Inventory consists primarily of spare parts, salt and supplies, carried at cost using a weighted average cost method. The cost of inventory is expensed upon use (consumption method). The MDTA analyzes inventory for impairment on a periodic basis. For the year ended June 30, 2024, the MDTA determined no inventory was impaired, and as such, no allowance was recorded. Capital Assets MDTA evaluates capital assets regulatory for impairment. If circumstances suggest that assets may be impaired, an assessment of recoverability is performed prior to any write-down of assets. An impairment charge is recorded on those assets for which the estimated fair value is below its carrying amount. No material impairment charges to capital assets were recorded for the fiscal year ended June 30, 2024. Capital assets, not being depreciated, consist of land and construction in progress, which are recorded at historical cost. Land is determined to have an inexhaustible life. Construction in progress is transferred to a depreciating asset category upon completion of the project, at which time depreciation will commence. Capital assets, net of depreciation, consist of buildings, building improvements, infrastructure, machinery, equipment, and vehicles, which are recorded at historical cost less accumulated depreciation. Donated capital assets and capital assets received in a service concession arrangement are reported at acquisition value rather than fair value. The MDTA defines capital assets as assets with an initial individual cost of $100 or more, and an estimated useful life in excess of seven years.
Capital Asset Type Land Improvements
Useful Life
20 Years
Buildings & Building Improvements
25-75 Years 40-75 Years 7-20 Years
Infrastructure
Machinery, Equipment & Vehicles
Land improvements, buildings, building improvements, infrastructure, machinery, vehicles and equipment are depreciated using the straight-line method of depreciation over the following estimated useful lives: Restricted Assets In accordance with the Trust Agreements, the MDTA has established and maintains certain restricted accounts. Funds have been deposited in these accounts and are restricted for the payment of debt service related to the revenue bonds, major capital replacements, improvements, betterments, enlargements or capital additions and non-recourse related debt.
Annual Comprehensive Financial Report For Fiscal Year Ended June 30, 2024 | 51
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