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Endowment Management > Glossary


Allocated spending:

The amount authorized annually for spending on designated purposes, as determined by the spending policy and board resolution.

Annual attainment:

Yearly total of cash gifts, pledges, estate commitments and other designations guaranteed by a legally binding document.

Asset allocation:

Investment diversification designed to achieve consistent, sustainable long-term returns; limit volatility; maintain necessary liquidity; and protect against inflation.

Beginning balance:

The corpus, plus accumulated investment returns and minus allocated spending, as of the start of the fiscal year (July 1).

Board-designated fund:

Unrestricted funds that the Board of Trustees designates for a particular purpose. The board may change or lift these designations at any time. These restrictions are not imposed by a donor.

Combined endowment:

Includes those funds managed by the university’s Office of Investments as well as funds held by others—that is, dollars held and invested by entities such as foundations or private financial institutions. These funds are considered part of the university’s long-term investments.

Corpus:

Gifts made to establish or increase a fund, not including investment returns. Also known as “principal.”

Distribution:

The amount—often expressed as a percentage—that the Board of Trustees approves spending from a fund or funds in a fiscal year.

Ending balance:

The corpus plus accumulated investment returns and minus allocated spending at the end of the fiscal year (June 30).

Endowment fund:

A fund that is created by donors requiring the restriction of the gift(s) in perpetuity with only investment return available for allocated spending.

Endowment pool:

Funds invested and managed by the university; includes endowment funds, funds functioning as endowment funds, and board-designated funds.

Fiscal year:

Case Western Reserve University's fiscal year is from July 1 through June 30.

Fund balance:

The net worth of a fund, measured by total assets minus total liabilities for the designated fiscal year (July 1-June 30).

Funds functioning as endowment:

Funds, such as unrestricted gifts to the university, that the Board of Trustees elects to treat as an endowment fund. The trustees can decide which funds are treated in this manner, and also change their status at any time. Also known as “quasi-endowment.”

Fund principal:

Includes all gifts to an individual fund, transfers from other funds, and income distributions that are reinvested to this individual fund. Fund principal is not affected by changes in the market.

Gifts:

Donated assets on a fiscal year basis (July 1 through June 30). Gifts received late in one fiscal year may be reported in the subsequent fiscal year due to processing.

Gifts added:

Includes gifts and transfers made between July 1 and June 30.

Investment pool:

A group of funds—including endowment funds, funds functioning as endowment and board-designated funds—that are invested in a broadly diversified portfolio.

Investment returns:

Overall returns, including realized and unrealized gains and losses, within a fiscal year (July 1 through June 30).

Market value:

The actual value of the endowment pool—those funds directly managed by the university—as of June 30 of a designated year. This value includes growth through additional income provided through cash gifts or payments on existing gifts, and growth through investment returns. It also includes decreases in the total value that arise from spending—including withdrawals from the endowment to fulfill donor intentions (such as supporting faculty through endowed professorships). Decreases also arise from administrative fees and endowment management. Decreases in value also can arise from negative investment returns.

Permanently restricted net assets:

Include gifts, trusts and pledges on which donors have imposed the restriction that the amount invested is maintained in perpetuity and the investment returns be made available only to support designated program operations. In the case of trusts, gains and losses are added to the gift amount. Gifts restricted by donors to provide loans to students are also included in permanently restricted net assets.

Spending allocation:

The distribution of endowment funds toward designated purposes, based on the spending policy.

Spending policy:

Determines the annual allocated spending, based on a board resolution, with the objective to preserve the intergenerational equity and provide support for operations. Starting July 1, 2015, new gifts will be invested for twelve months before the spending allocation is applied.

Temporarily restricted net assets:

Investment returns from endowments and gifts for which donor-imposed restrictions have not been met.

Unrestricted net assets:

Funds available for any purpose consistent with the university's mission. Unrestricted funds functioning as endowment and related investment returns are included in unrestricted net assets.