Trust Funds

Our Purpose

Definition Of Trust Funds

Operational Policy and Procedures for Trust and Endowment Fund Management

Spend Down Trusts

Internal Transfer

How To Open A Trust Fund Project

Establishing a Trust Fund

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Our Purpose

Through prudent management, it has been the objective of our Trust Funds to provide a steady flow of income for the University to maintain and enhance our academic, research and scholarly activities.  Our funds are managed by external money managers under policies established by the Board of Governors.  The integrity of the capital of each trust fund is maintained by spending only a portion of the investment income.  Currently, the University's policy is to disburse 4.0% of the average market value of the funds and capitalize the remaining investment income to ensure continued growth and to protect the purchasing power of the original capital.

The guiding principles and objectives of the University's investment policies are:

  • preservation and growth of capital through judicious investment management and a responsible income distribution policy
  • commitment to our donors that their directions on the use of the expendable investment income from their funds will be honoured
  • communication to our donors on the performance and impact of their endowed funds
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Definition of Trust Funds

The University receives donations and places the gift in a category as outlined in the Charitable Giving Policy and Procedural Guidelines section 4(a)(ii). The categories are: Undesignated gifts; Broadly Designated gifts and Specifically Designated gifts.

When the expenditure of designated donations from private sources is determined by written "terms and conditions" and/or legal requirements, that have been agreed upon by the donor and the University, these donations are placed in "trust fund" projects.

This document deals strictly with trust fund projects only.

Trust funds are either General, for perpetual, spend down and long-term trust funds, or Specific, for short-term trust funds.

Perpetual trusts are funds from which only income from the capital may be expended. Principal invested in the Long Term Pool.

Spend Down trusts are funds from which both the income earned and capital will be expended. Principal invested in the Long Term Pool. The spend down trust is suitable for trust balances greater than $100,000.

Long-term trusts are funds from which both the income and the capital may be expended. Any capital to be spent from long-term trusts must be defined as expendable. Principal invested in the Short Term Pool.

Short-term trusts are funds which are to be spent in the current year for some expressed purpose

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How To Open A Trust Fund Project

Before proceeding, please read
Policy and Procedures.

Please refer to "New Trust Fund" in Mosaic using the following navigation: Main Menu > Finance > Project Costing > Project Definitions > New Trust Fund

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Establishing a Trust Fund

Acceptance And Processing of Gift

DONOR

  • Contacts University with interest to establish trust fund

 

UNIVERSITY ADVANCEMENT

DEVELOPMENT
  • Drafts terms of reference in consultation with donor and appropriate trust fund administrator
  • Forwards Pledge of Support or Gift Agreement (containing payment schedule if appropriate) to donor for completion and signature
  • Proceeds with request to open trust fund project
 
ADVANCEMENT SERVICES
  • Establishes record & allocation code
  • Informs Accounting Assistant, Trust Funds of allocation code

for pledges only:

  • Forwards pledge reminders to donor according to payment schedule

for cash contributions (may include pledge component):

  • Issues tax receipt and thank you letter for mailing through Development
  • Includes contribution in month-end report for transfer of funds to newly-opened trust fund projects

 

DEVELOPMENT

  • Requests opening of trust fund project from appropriate trust fund administrator
  • Provides following information: 
    • name of fund 
    • terms of reference 
    • type of trust fund (general or specific) 
    • if general: expendable or non-expendable capital 
    • amount of funds currently available and/or copy of gift agreement 
    • donor contact info
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Approval Process

TRUST FUND ADMINISTRATOR

  • Confirms terms with relevant faculty
  • Presents terms to appropriate committee for approval
  • Requests Accounting Assistant, Trust Funds to open trust fund project
  • Provides Accounting Asst., Trust Funds with final approved terms

 

FINANCIAL SERVICES

Accounting Assist. - Trust Funds

  • Presents trust fund request to Chair of TFOC for approval to open trust fund project
  • Opens trust fund project as requested by trust fund administrator
  • Informs Trust Fund Administrator of project number
  • Advises Advancement Services of trust fund project number
  • Includes new trust fund on agenda of Trust Fund Operations Committee for review at next meeting

 

TRUST FUND OPERATIONS COMMITTEE

  • Appropriate Trust Fund Administrator presents proposed trust fund
  • Committee reviews terms of reference and/or gift agreement for approval
  • If fund is not approved or issues are outstanding, the fund is placed on the "trust funds in need of attention" list for follow-up and action
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Trust Fund Management (According To University Policy)

General funds:

  • Interest applied monthly for trust funds established after Dec. 31 in each given year
  • Interest applied at fiscal year-end for trust funds established before Dec. 31 in each given year
  • Disbursements based on 4.0% of annual investment income
  • Disbursement managed by trust fund administrator
  • Additional interest beyond 4.0% re-invested in trust fund to maintain earning power of the trust fund
  • University issues annual Endowment Fund Statement for donor reporting

 

Specific funds:

  • Total contribution is expendable
  • Fund does not earn interest