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, i 1111 1 1 Ool <br />Notes to the Financial Statements <br />June 30, 2020 <br />I <br />11111V1? <br />0911C <br />C. Cash, Cash Equivalents and Investments <br />The District's cash and cash equivalents are considered to be cash on hand, demand <br />deposits, and short-term investments with original maturity of three months or less from the <br />date of acquisition. Cash and cash equivalents are combined with investments and displayed <br />as cash and investments. <br />Highly liquid market investments with maturities of one year or less at time of purchase are <br />stated at amortized cost. All other investments are stated at fair value. Market value is used <br />as fair value for those securities for which market quotations are readily available. <br />D. Prepaid Items <br />Certain payments to vendors reflect costs applicable to future accounting periods and are <br />recorded as prepaid items. <br />E. Capital Assets <br />Capital assets (including infrastructure) are recorded at cost where historical records are <br />available and at an estimated original cost where no historical records exist. Donated or <br />contributed capital assets are stated at acquisition value on the date donated or contributed. <br />Capital assets are defined by the District as assets with an initial, individual cost of more than <br />$5,000 and estimated useful life of three years or more. <br />The District depreciates all capital assets over their estimated useful lives. The purpose of <br />depreciation is to spread the cost of capital assets equitably among all users over the life of <br />these assets. The amount charged to depreciation expense each year represents that year's <br />pro rata share of the cost of capital assets. <br />Depreciation is provided using the straight line method which means the cost of the asset is <br />divided by its expected useful life in years and the result is charged to expense each year until <br />the asset is fully depreciated. The District has assigned the useful lives listed below to capital <br />assets: <br />Useful lives <br />(in years) <br />Equipment 3-10 <br />Improvements 5-20 <br />Structures 20 <br />Major outlays for capital assets and improvements are capitalized in construction in progress <br />as projects are constructed. <br />W <br />