I will not speak to the best approach using RE. However, I need to point
out that there is a third option which I am seeing growing in "popularity"
as demanded by in-house counsel. And that is the complete revocation
(deletion) of the original pledge and subsequent recording of a new pledge
for only the amount the donor agrees to personally pay.
I personally do not like this third option. However, it seems that more
in-house counsels I come across are getting a bit jittery over what we have
tended to follow in the past. So I simply suggest that whatever approach
you take receives the blessing of your attorney.
John
John H. Taylor
Principal, John H. Taylor Consulting
2604 Sevier St.
Durham, NC 27705
johntaylorconsulting@gmail.com
919.816.5903 (cell/text)
Serving the Advancement Community Since 1987
On Wed, Jan 23, 2019 at 8:54 AM Hornbeck, Cynthia <
CHornbeck1@twu.edu>
wrote:
> I have a question on the pledge payments from a Donor Advised Fund. I
> know we do not link them to the pledge as a payment so we have to reduce
> the pledge. The question I have is how is everyone reducing the pledge.
>
>
>
> We use RE and we also have FE so everything has to be run through the GL.
> There are two ways I have found to reduce the pledge I just want to make
> sure whichever way we decided to go it will not cause a problem with the
> CASE and VSE reporting (which I have not had the pleasure of doing yet so I
> am not sure what all is reported).
>
>
>
> Way number 1 – I can write off the installment that was paid through the
> donor advised fund which will leave the beginning balance of the pledge the
> same, but I come from a receivables background and when I see “write off”
> to me that says Bad Debit the money will never come in, but in this case it
> has come in we just could not apply it. Do either of the CASE or VSE
> reports take into account “write offs”?
>
>
>
> Way number 2 – I can change the amount of the pledge (reduce it by the
> amount of the installment) and run this through the GL to reduce the
> expected amount in FE so everything will match. The problem I have with
> this is if we need to report on the total amount of our pledges and then
> how much was received we would not have the original amount of the pledge
> in the system so the report would be off ( and how do you explain to the
> donor when they request a statement showing all their pledges and they see
> a pledge of $150,000 where the paperwork they signed said the pledge was
> $200,000).
>
>
>
> We are in the process of writing our procedures manual and I just want to
> make sure we can make the best informed decision and not find out we have
> to change it down the road to make the reporting correct.
>
>
>
>
>
>
>
> Thank you,
>
> Cynthia Hornbeck
>
> University Advancement
>
> 940-898-3894
>
>
CHornbeck1@twu.edu
>
> [image:
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