What You Should Know
Princeton University receives gifts from hundreds of sources every year in the form of outright contributions, bequests, deferred or planned gifts, and gifts-in-kind.
Many gifts come with donor restrictions on use. For example, a donor may specify that the gift must be used only for a specific research project, or for purchase of certain types of books for one of Princeton’s libraries. In 2010, gifts of restricted income represented 12 percent of our operating budget. These restricted funds are coded as fund 20.
Categories of Gifts
Gift administration oversees two broad categories of gifts: endowment gifts and term gifts.
- Endowment Gifts:A true endowment gift establishes a permanently invested fund. While income from the fund may be spent, the principal of the fund must remain intact. In some cases, donor stipulations allow for principal expenditures and these funds are known as quasi-endowment gifts. In the case of both true and quasi-endowment gifts, a donor will generally restrict the purposes for which the endowment income can be spent. Endowment gifts typically are received and processed through the Development Office.
- Term Gifts A term gift refers to a gift of which the principal is expended.
Processing Term Gifts
Term gifts often are received by academic departments and need to be processed correctly to ensure that the gift funds are spent in accordance with the donor’s restrictions and are being accounted for properly.
Ensuring that restrictions are met means that project grant managers and budget managers need to:
- understand what constitutes a gift;
- understand how to accept a gift;
- carefully track the way the gift and any associated income is spent.
For comprehensive information about gifts and gift administration, go to the Gift Administration page.