2. Endowment Suspense 10 (for non-majors) UW Endowments from the Perspective of Endowment Suspense 10-13-09

3. 1. Endowments have minimums. $25,000: program support, research fund, lectureship $50,000: scholarships $100,000: Fellowships $250,000: Professorships $1,000,000: Chair Two facts about endowment investing: 2. Gifts are invested once each quarter. UW Endowment Basics

4. Suspense Account CEF JunFebMarAprMay Accumulating gifts to new endowments Additions to existing (invested) endowments 4 th qtr investment UW Endowment Basics: Why Have Suspense Accounts? Suspense Accounts:  accumulate gifts until the minimum is reached.  hold additions to existing endowments until the next investment date

5. Three matching programs: 1. Matching Gift Initiative (MGI) 2. Faculty-Staff-Retiree (FSR) Campaign for Students 3. Students First UW Endowment Basics NO! There’s Matching! Simple, no?

6. 96-9000 New Endowment Suspense Non-matchable gifts accumulating to minimum, including non-matchable FSR gifts 96-9100 CEF Suspense Existing Non-matchable additions to existing endowments, including non-matchable FSR gifts Suspense account budget #’s: 96-9x00 UW Endowment Basics: Suspense Account Taxonomy we need at least two… …but there’s FSR and Students First Matching!

7. 96-9000 New Endowment Suspense Non-matchable gifts accumulating to minimum, including non-matchable FSR gifts 96-9100 CEF Suspense Existing Non-matchable additions to existing endowments, including non-matchable FSR gifts 96-9500 New Endowment Suspense FSR Matchable gifts to accumulating FSR endowments 96-9600 FSR Matchable Gifts Matchable additions to existing FSR endowments 96-9700 New Endowment Suspense SCH Matchable gifts to accumulating Students First endowments 96-9800 CEF Suspense SCH Matchable additions to existing Students First endowments UW Endowment Basics: Suspense Account Taxonomy …and don’t forget MGI !

8. 96-9000 New Endowment Suspense Non-matchable gifts accumulating to minimum, including non-matchable FSR gifts 96-9100 CEF Suspense Existing Non-matchable additions to existing endowments, including non-matchable FSR gifts 96-9500 New Endowment Suspense FSR Matchable gifts to accumulating FSR endowments 96-9600 FSR Matchable Gifts Matchable additions to existing FSR endowments 96-9700 New Endowment Suspense SCH Matchable gifts to accumulating Students First endowments 96-9800 CEF Suspense SCH Matchable additions to existing Students First endowments 96-9200 Founder’s Fund Suspense Founder’s Fund Matching Pool 96-9400 CEF Suspense MGI Additions to existing MGI endowments UW Endowment Basics: Suspense Account Taxonomy

9. Endowment Suspense Report Basics: Purpose and Process Purpose  Provide quarterly investment data to Treasury:  Amounts to invest (new and existing endowments).  New endowments over investment minimum.  Segregate matchable from non-matchable gifts.  Provide tracking info for departments and fund raisers. Process  Identify, sort and total gifts posted monthly to FIN.  Verify that totals reported to Treasury = totals in FIN  Identify misplaced funds, make corrections. Schedule  Monthly, posted by the 15 th.  Interim Report, 3 rd month of each quarter, data pulled on the 20th.

10.  Corrections involve selling CEF shares to backfill the deficit (bad, especially bad in a down market)  This is often due to a gift modification after the funds have invested. Endowment Suspense Report Basics: What’s at stake? OOPS! Errors in reporting or in gift-processing (mis-allocations) can cause Treasury to over-invest.

11. Endowment Suspense Report Basics: Glossary Suspense Account budget numbers: 96-9x00 Principal Account numbers: 99-xxxx Allocation Code: 6-letter code OR 6-letters + S/F/M Pool Code: Suspense account #. e.g., 96-9100  used to track individual endowments with the suspense accounts  account number assigned to invested endowments within the CEF and suspense accounts  state agency accounts in the CEF: 38-xxxx  REDDOG: non-matchable gifts  REDDOGS: matchable gifts, Students First matching program  REDDOGF: matchable gifts, Faculty-Staff-Retiree matching program  REDDOGM: matchable gifts, Matching Gifts Initiative  Specifies which suspense account receives funds as they are distributed out of the general ledger into suspense.

12. Endowment Suspense Report Basics: Example Scenario 1. A professor establishes a pledge payment program for a new Financial Analysis Training in Biology Endowment, within the FSR matching program. 2. The new endowment is assigned the Allocation Code: FATBIOF 3. The pool code for the new endowment is 96-9500 (New Endowment Suspense-FSR) 4. Each month, payroll deductions are FAS’d to 96-9500 and allocated to FATBIOF. 6. Continuing payroll deductions are now FAS’d to 96-9600 and will be matched until his contributions total $10,000 (he can continue to make non-matching contributions after that). 5. In Nov 2008, 96-9600 FATBIOF reaches the $5,000 minimum. On Jan 1, 2009, Treasury invests the balance in the CEF and the endowment is assigned the principal account number 99-6666. The pool code is updated from 96-9500 to 96-9600 (FSR Matchable Gifts). 7. The Biology Dept finds some extra money in a current use account and decides to make its own monthly matching contributions to the FATBIO endowment. This money is not eligible for UW matching so a new (“mirror”) allocation is created, FATBIO, with the pool code 96-9100 (CEF Suspense Existing). 8. Note that the endowment now has two allocation codes pointing to a single principal account number, and that each allocation code has a different pool code.

13. 1. Quarterly Report 2. Quarterly Investment Data 3. Reconciliation to MyFD BSR 4. Monthly Transaction Datasheet 5. Master Allocation List Endowment Suspense Report Basics: Report Workbook Tabs

14. Quarterly Report: Allocation Description Endowment name Allocation Code Principal Acct # Error flag (!) School abbreviation Department

15. Previous qtr ending balance Amt invested Balance after investment Quarterly Report : Investment Data

16. Ending balance Monthly activity by allocation Total quarter activity Quarterly Report : Monthly Transactions (  Gifts)

17. Adjustments for pending transactions Adjusted quarter total (does not reconcile to MyFD) Reference to footnote explaining adjustment/anomaly Quarterly Report : Adjustments and Notes

18. Where’s the money (which suspense account)? Control-F is Excel find  Look up allocation in Advance. The pool code is the suspense account #  Look up the pool code on the Monthly Allocations Tab of any suspense report.

19. What’s the current balance? Ending balance Monthly activity by allocation Total quarter activity  The Quarterly Report tab lists monthly activity and current totals. Control-F is Excel find

20.  The monthly transaction datasheets list individual gifts and transfers. What gifts make up the total? Allocation CodeTran Dec = Donor NameTran Ref 3 = Gift Receipt #

21. Any questions: Michael Tu Analyst UA Finance & Administration (206) 685-9596 mstu@u.washington.edu