CHAPTER 25
ENDOWMENT TRUST
CSU FUND:
466 – Endowment Trust
FUND TYPE:
CSU Fiduciary Private Purpose Trust
AUTHORITY:
Executive Order 1000 – Section IIIA
1.0 OVERVIEW AND DEFINITIONS:
It is the policy of the California State University (CSU) that, in accordance with Education Code
89721, the Chief Fiscal Officer of each campus of the CSU shall deposit into and maintain in
local trust accounts or in trust accounts in accordance with Sections 16305 to 16305.7, inclusive,
of the Government Code, or in the California State University Trust Fund, moneys received in
connection with endowments.
The University’s endowment is comprised of many individual funds. Each was created by an
agreement between the University and a donor(s) for a particular purpose. The donor is allowed
to impose restrictions on how the funds are to be spent; these are called restricted funds. If the
donor does not specify a restriction, the University may use the funds for purposes the University
President deems most pressing; these funds are called unrestricted.
The University has an investment policy that seeks to maximize long-term real returns with
minimum risk. Consideration is given to the rate of inflation and investment fees in investment
decisions so that the overall purchasing power of the endowment can be maintained.Each donorcreated endowed fund receives investment earnings as a percentage of the overall endowment,
much like an owner of a mutual fund owns “units.”
Once spendable portions of the endowment funds are transferred to the endowment’s associated
scholarship or trust expenditure account, the faculty member (or administrator) responsible for
those funds (Project Director or Principal Investigator) may utilize the funds in accordance with
the terms and conditions of the endowment. Funds should be spent directly from that associated
operating account to facilitate easy reporting back to the donor as to how their funds were spent.
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ENDOWMENT TRUST
This report is done annually in the form of an endowment report following the close of the fiscal
year.
Land and other real estate held as investments by endowments should be reported at fair value at
the reporting date. Changes in the fair value during the period should be reported as endowment
investment income.
2.0 FUND SPECIFICS:
CSU Fund 466 TF-Endowment Trust: Used to record activity related to endowments received
by the University.
Only the actual endowment balance, including the original endowment principal and retained
investment earnings, stays in this fund. Investment earnings and amounts designated for projects
or financial aid should be transferred to the appropriate trust fund before expenditure.
3.0 FUND MANAGEMENT AND ACCOUNTING PRACTICES:
3.1 Unique IRA FIRMS Object Codes
For object code definitions, please see Appendix 19.
130466
510090
510100
570466
670431
Due from CSU 466 -TF Endowment Trust
Endowment Investment Income-Other (includes gain or loss)
Additions to Permanent Endowment (to record initial contributions to principal)
Tr In from CSU 466 -TF Endowment Trust
Tr Out to CSU 431 -TF Restricted Scholarships and Grants
4.0 REPORTING REQUIREMENTS:
None
5.0 FUND BALANCE:
None
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ENDOWMENT TRUST
6.0 GAAP IMPACT:
See GAAP Manual Chapters 4-13 and 8 for the proper recording and footnote disclosure related
to endowments, investment income for endowments and underwater endowments. As the
majority of CSU’s endowment funds are held by auxiliary organizations, required
accounting and disclosures for endowments of both FASB and GASB reporting entities are
discussed in more detail in Chapter 8 of the manual.
7.0 RESOURCES:
GAAP Manual:
Chapter 4-13 Other Accounting Issues
Chapter 8 Auxiliary Organizations
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ENDOWMENT TRUST
REVISION CONTROL
Document Title:
CHAPTER 25 - CSU FUND 466 – ENDOWMENT TRUST
Contributor:
Sheralin Klinthong
Reviewer:
Sedong John
CO Owner:
Roberta McNiel
Issuance Date:
February 10, 2014
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