Accounting

Effective Date: 07/01/00

Policy Statement 6: Establishing an Endowment Fund


General

An endowment gift is one in which the original principal is never invaded; the gift exists in perpetuity. Endowments are generally funded within five years of the initial contribution. Income is computed annually through June 30 of each year, and is distributed in August or September.

Guidelines

Refer to ACT Policy 5: Establishing a Trust Fund


Approval

Each new endowment fund must be accepted by the Board of Trustees of the Endowment Fund on recommendation of the Chancellor.


Pertinent Information

The request for an endowment fund should include the following:

After approval of a new endowment fund, the Special Funds Office will assign an account number and notify the requesting department.


Correspondence

Any correspondence significant to the proposed endowment fund should accompany the request for a new fund.

Subsequent correspondence containing significant information about the fund should be copied and sent to the Special Funds Office for placement in the Endowment Fund's permanent folder.


Changes

Anticipated changes in disbursing authority and/or address, fund name, or purpose should be reported to the Special Funds Office so that a revised fund authority may be prepared.