State of Connecticut

Reconciliation of Governmental Funds Balance Sheet      
to the Statement of Net Assets      
June 30, 2008      
(Expressed in Thousands)      
Total Fund Balance - Governmental Funds     $3,120,784
       
Net assets reported for governmental activities in the Statement of Net Assets      
are different because:      
Capital assets used in governmental activities are not financial resources      
and therefore are not reported in the funds. These assets consist of:      
       
  Buildings 2,750,789  
  Equipment 1,377,724  
  Infrastructure 10,867,383  
  Other Capital Assets 3,901,018  
  Accumulated Depreciation (8,909,219) 9,987,695
       
Debt issue costs are recorded as expenditures in the funds. However,      
these costs are deferred (reported as other assets) and amortized over the      
life of the bonds in the Statement of Net Assets.     71,095
       
Some of the state's revenues will be collected after year-end but are not      
available soon enough to pay for the current period's expenditures      
and therefore are deferred in the funds.     404,196
       
Internal service funds are used by management to charge the costs of      
certain activities to individual funds. The assets and liabilities of the internal      
service funds are included in governmental activities in the Statement of      
Net Assets.     (13,140)
       
Long-term liabilities are not due and payable in the current period and therefore      
are not reported in the funds (Note 16).      
       
  Net Pension Obligation (1,916,537)  
  Net OPEB Obligation (1,234,395)  
  Worker's Compensation (412,619)  
  Capital Leases (51,748)  
  Compensated Absences (477,557)  
  Claims and Judgments (13,635) (4,106,491)
       
Long-term bonded debt is not due and payable in the current period and      
therefore is not reported in the funds. Unamortized premiums, loss on      
refundings, and interest payable are not reported in the funds. However,      
these amounts are included in the Statement of Net Assets. This is the net      
effect of these balances on the statement (Note 16).      
       
  Bonds Payable (15,883,252)  
  Unamortized Premiums (561,058)  
  Less: Deferred Loss on Refundings (212,830)  
  Accrued Interest Payable (120,588) (16,352,068)
       
Net Assets of Governmental Activities     $(6,887,929)

The accompanying notes are an integral part of the financial statements.