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PENINSULA AIRPORT COMMISSION
NOTES TO THE FINANCIAL STATEMENTS
JUNE 30, 2023
16
Note 2—Summary of significant accounting policies (continued)
Maintenance and repairs, including replacement of minor items of physical properties that do not improve or
extend the life of the respective assets, are expensed currently.
Capital assets also include certain right-of-use (“ROU”) Information Technology (“IT”) subscription assets. These
ROU assets arise in association with agreements where the Authority enters into an IT subscription. The ROU
IT subscription assets are initially measured at an amount equal to the initial measurement of the subscription
liability plus any subscription payments made at the start of the subscription term, if applicable. The ROU
subscription assets are amortized on a straight-line basis over the subscription term.
Allowance for Doubtful Accounts – The Commission evaluates its accounts receivable individually. A change to
income to absorb possible credit losses is provided when, in the opinion of management, it is appropriate.
Virginia Retirement System (“VRS”) Pensions and Other Postemployment Benefits (“OPEB”) – For purposes of
measuring all financial statement elements related to pension and OPEB plans, information about the fiduciary
net position of the Commission’s plans and the additions to/deductions from the Commission’s Plan’s fiduciary
net position have been determined on the same basis as they were reported by the VRS. For this purpose, benefit
payments (including refunds of employee contributions) are recognized when due and payable in accordance
with the benefit terms. Investments are reported at fair value.
Deferred Outflows/Inflows of Resources – In addition to assets, the statement of net position reports a separate
section for deferred outflows of resources, representing a consumption of net assets that applies to future periods
and so will not be recognized as an outflow of resources until then. In addition to liabilities, the statement of net
position reports a separate section for deferred inflows of resources, representing an acquisition of net assets that
applies to future periods and so will not be recognized as an inflow of resources until that time. The Commission
has the following items that qualifies for reporting as either deferred inflows or outflows:
•
Contributions subsequent to the measurement date for pensions and OPEB are a deferred outflow and will
be applied to the net pension or OPEB liability in the next fiscal year.
•
Differences between expected and actual experience for economic/demographic factors in the measurement
of the total pension or OPEB liability. These differences will be recognized in pension or OPEB expense over
the expected average remaining service life of all employees provided with benefits in the plan and may be
reported as a deferred inflow or outflow.
•
Differences resulting from changes in assumptions on pension plan or OPEB investments. This change in
flow of resources will be recognized in pension or OPEB expense over the estimated remaining service life
of employees subject to the plan.
•
Difference between projected and actual earnings on pension and OPEB plan investments. This change in
flow of resources will be recognized in pension or OPEB expense over a closed five-year period.
•
Difference resulting from a change in the Commission’s proportion of the collective net OPEB liability. This
change in flow of resources will be recognized in OPEB expense over the expected average remaining
service life of all employees provided with benefits in the plan.
•
Differences result from deferred amounts related to leases.
Subsequent Events – In preparing these financial statements, the Commission has evaluated events and
transactions for potential recognition or disclosure through December 11, 2023, the date the financial statements
were available to be issued.
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