CITY OF LAGUNA NIGUEL NOTES TO BASIC FINANCIAL STATEMENTS JUNE 30, 2024 NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) D. Investments (Continued) d investments of all funds. Each fund’s share in this pool The City pools cash an is displayed in the accompanying financial statements as cash and investments. Investment income earned by the pooled investments is allocated to the various fu nds based on each fund’s average cash and investment balance, except for investment income associated with funds not legally required to receive pooled investment income, which has been assigned to and recorded as revenue of the General Fund, as provided by California Government Code 53647. E. Fair Value Measurements value, establishes a framework for measuring fair value and U.S. GAAP defines fair establishes disclosures about fair value measurement. Investments, unless other wise specified, recorded at fair value in the financial statements, are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Levels of inputs are as follows: The three levels of the fair value measurement hierarchy are described below: nputs are unadjusted, quoted prices for identical assets or liabilities in Level 1 – I active markets at the measurement date. Level 2 – Inputs, other than quoted prices included in Level 1, that are observable for the assets or liabilities, either directly or indirectly and fair value is determined through the use of the models and other valuation methodologies including: x Quoted prices for similar assets or liabilities in active markets; x Quoted prices for identical or similar assets or liabilities in markets that are inactive; x Inputs other than quoted prices that are observable for the asset or liability; x Inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 – Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the assets or liabilities at the measurement date. F. Receivables Receivables include su es, charges for ch items as taxes, intergovernmental revenu service No allowance for s, miscellaneous accounts receivable, and interest receivable. doubtful accounts has b ered een established, as the City believes all amounts are consid to be colle ctible in the normal course of business. (41)