The University of Chicago

Financial Services

  

2305 Establishment and Liquidation of Funds Functioning as Endowment

Subject Area: Private Gifts and Grants
Responsible Office: Financial Services
Sponsor: Chief Financial Officer
Originally Issued: July 1987
Revised: October 2009
Refer Questions To: John Kroll, 773-702-1941

Purpose: To establish procedures to create and liquidate funds functioning as endowment.

Introduction

Board authorization to establish an endowment fund is required whenever the donor's written instructions concerning the use of funds as endowment are unclear or absent. Likewise, Board authorization is required to liquidate funds functioning as endowment. Each year the University receives requests from the various schools and divisions, or the Development Office, to create new funds functioning as endowment or liquidate existing funds.

Purpose

While the Executive Committee retains its traditional oversight over the creation of funds functioning as endowment, this policy allows for the more efficient management of endowment funds throughout the year, and establishes procedures to create new funds functioning as endowment and liquidate previously established funds.

Policy

  1. The minimum threshold to establish a new fund functioning as endowment is $25,000. Monies used to create a new fund functioning as endowment account, or monies added to an existing fund functioning as endowment account must be held for a minimum of ten years.
  2. The Chief Financial Officer is authorized to approve individual requests for new funds functioning as endowment or additions to existing funds functioning as endowment up to $1 million per request. Any request to establish or add to a fund functioning as endowment in excess of $1 million requires Board of Trustees approval.
  3. Each June, the Chief Financial Officer will report on new funds functioning as endowments established in the past year, and obtain ratification from the Executive Committee of the Board of Trustees for funds functioning as endowment under $1 million that have been created during the previous twelve months.

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