Capital assets are depreciated using the straight-line method over the following estimated
useful lives:
Assets Years
Buildings 40
Building improvements 20 - 40
Infrastructure 7 - 60
Vehicles 3-8
Machinery and equipment 5 - 20
Computer equipment 3-5
Equity Interest in Pennichuck
The City’s equity interest in Pennichuck Corporation represents, through the acquisition of all
outstanding shares, the control of all of Pennichuck’s assets, liabilities and businesses,
including land comprising the watershed of the Pennichuck Brook and the three regulated
water utilities owned by Pennichuck. Taking into account all of the assumed liabilities of
the company and its businesses, the acquisition was valued at approximately $200 million.
Pennichuck remains an independent corporation with an independent Board of Directors
with the City of Nashua as its sole shareholder.
The City accounts for this asset in accordance with GASB Statement 90 — Majority Equity
Interests — an Amendment of GASB Statements No. 14 and No. 61. The equity interest
represents an asset to offset the related acquisition bonds in the governmental funds, and is
adjusted accordingly by the related debt service.
Compensated Absences
It is the City’s policy to permit employees to accumulate earned but unused vacation and
sick pay benefits. All vested sick and vacation pay is accrued when incurred in the
government-wide and proprietary fund financiai statements. A liability for these amounts
is reported in governmental funds only if they have matured, for example, as a result of
employee resignations and retirements.
Long-Term Obligations
In the government-wide financial statements, and proprietary fund types in the fund
financial statements, long-term debt, and other long-term obligations are reported as
liabilities in the applicable governmental activities, business-type activities, or proprietary
fund type Statement of Net Position.
Fund Equity
Fund equity at the governmental fund financial reporting level is classified as “fund
balance”. Fund equity for all other reporting is classified as “net position”.
Fund Balance
Generally, fund balance represents the difference between the current assets/deferred outflows
of resources and current liabilities/deferred inflows of resources. The City reserves those
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