CITY OF FAYETTEVILLE, GEORGIA

RECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURES, AND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDS TO THE STATEMENT OF ACTIVITIES FOR THE FISCAL YEAR ENDED JULY 31, 2017

in the statementof activities the cost ofthose assets is allocatedovertheirestimateduseful lives andreportedasdepreciationexpense. Thisis the amount by which capital outlay exceeded depreciation expense in the current period.

The issuance oflong-termdebtprovidescurrentfinancialresources to governmentalfunds, while the repaymentof the principaloflong-termdebtconsumes the currentfinancialresourcesofgovernmental funds.Neithertransaction,however,hasany effect onnetposition. Also, governmentalfundsreport the effect ofpremiums,discounts,and similaritems whendebt isfirst issued,whereastheseamountsare deferredandamortized in the statementof activities.This amount is the net effect accompanying notes are an integral part of these financial statements.