Page 523 - FortWorthFY23AdoptedBudget

I. Authority

The Fort Worth City Council is responsible for legislation, policy formulation, and overall
direction setting of the government. This includes the approval of financial policies which
establish and direct the operations of the City of Fort Worth. The City Manager and the
Assistant City Managers are responsible for carrying out the policy directives of the City
Council and managing the day-to-day operations of the executive departments, including
the Financial Management Services Department (FMS). This policy shall be administered
on behalf of the City Manager and the Assistant City Managers by the Chief Financial
Officer/Director of Finance (CFO).

II. Purpose
This policy defines and provides the guiding principles with respect to the financial
management of leases and subscription-based Information Technology agreements
(SBITAs) for the City of Fort Worth (City). The objectives of this policy are to ensure
consistent lease practices in accordance with Generally Accepted Accounting Principles
(GAAP) and applicable regulatory agencies in the setting up and reporting of Leases
meeting the GASB requirements. Controls are created to establish, maintain, and enforce
a sound system of operational procedures and internal control objectives. These controls
address the decentralized nature of the processes associated with leases and SBITAs while
also providing standards and acceptable controls for these activities.

III. Applicability and Scope

All employees of the City, including uniformed employees in positions who are responsible
for performing fiscal operations described herein, shall apply the principles of this policy.
This may include, but not be limited to, staff who enters into a lease and/or SBITA, receives
right to use assets and monitor use. Further, this policy shall cover all funds and right of
use assets under the fiscal control of the City Manager and the Mayor and City Council.

IV. Glossary
See definitions related to this policy provided in the Glossary for Financial Management
Policy Statements.
V. General Information

This policy provides the following definition of a lease is a contract or agreement which
conveys control of the right to use another entity’s nonfinancial asset (the underlying asset)
as specified in the contract/agreement for a period of time in an amount equivalent to the
value of the asset. Examples of nonfinancial assets include buildings, land, vehicles, and
equipment. Any agreement that meets this definition will be accounted for under the lease
guidance, unless specifically excluded.
A SBITA is a contract or agreement which conveys control of the right to use IT software
alone, or in combination with tangible capital assets (underlying IT assets), for a period of
time in an amount equivalent to the value of the asset. Any agreement that meets this
definition will be accounted for under the lease guidance, unless specifically excluded.

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