Page 180 - PowerPoint Presentation

XV. CAPITAL MAINTENANCE AND REPLACEMENT
The Town recognizes that deferred maintenance and not anticipating capital replacement needs
increases future capital costs. Annually, available funds will be evaluated during the budget
process and a percentage of each operating fund’s budget will be recommended to the Council for
transfer.

Upon approval by the Council, the recommended amount will be transferred to the appropriate
funds (General/Utility/Vehicle Maintenance Replacement Fund) for major maintenance and
replacement of street, building roof, flooring, air conditioning, equipment, etc.

XVI. INTERNAL CONTROLS
A. Written Procedures - Whenever possible, written procedures will be established and
maintained by the Finance Director for all functions involving purchasing, cash handling and/or
accounting throughout the Town. These procedures will embrace the general concepts of fiscal
responsibility set for in this policy statement.

B. Department Directors’ Responsibilities - Each department director is responsible for ensuring
that good internal controls are followed throughout his/her department, that all directives or
internal controls are implemented, and that all independent auditor internal control
recommendations are addressed. Departments will develop and periodically update written
internal control procedures.

XVII. ASSET MANAGEMENT
A. Investments – The Finance Director shall promptly invest all Town funds with the depository
bank in accordance with the provisions of the current Bank Depository Agreement or in any
negotiable instrument authorized by the Town Council. Further, investments shall be made in
accordance with the Investment Policy approved by the Town Council for the Town of
Westlake that meets the requirements of the Public Funds Investment Act (PFIA), Section 2256
of the Texas Local Government Code. The Finance Director will issue quarterly reports on
investment activity to the Town Council.

B. Cash Management - Town’s cash flow will be managed to maximize the cash available to
invest. Such cash management will entail the centralization of cash collections, where
feasibility, including utility bills, building and related permits and license, fines, fees, and other
collection offices as appropriate. Periodic review of cash flow position will be performed to
determine performance of cash management and conformance to investment policies. The
underlying theme will be that idle cash will be invested with the intent to (1) safeguard assets,
(2) maintain liquidity, and (3) maximize return.

C. Fixed Assets and Inventory - Such assets will be reasonably safeguarded and properly
accounted for and prudently insured. The fixed asset inventory will be updated regularly.

D. Capitalization Criteria – For purposes of budgeting and accounting classification, the following
criteria must be capitalized:
• The asset is owned by the Town of Westlake
• The expected useful life of the asset must be longer than one year, or extend the life on an
identifiable existing asset by more than one year
• The original cost of the asset must be at least $5,000
• The asset must be tangible
• On-going repairs and general maintenance are not capitalized
• New Purchases – All costs associated with bringing the asset into working order will be
capitalized as part of the asset cost. This includes start- up costs, engineering or consultant
type fees as part of the asset cost once the decision or commitment to purchase the asset
is made. The cost of land acquired should include all related costs associated with its
purchase

153