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  • 1.  When you "actualize" an immediate CGA?

    Posted yesterday

    Esteemed Colleagues:

    My role in Advancement Services is "new-ish" and I'm still questioning "why" on everything so I get things right. When do you record an immediate CGA as a deferred commitment and when do you record it as an actualized asset in your possession? Or do you just enter it as an outright gift?

    Per my CASE standards training, I view it as a planned gift. I want to record it as such in our database of record. I'd report on it at the end of the year as a commitment.

    My university's business office wants me to cash the check, enter as an actualized gift, and send it to the general ledger. The only support for that I've found for this is from charitablegiftplanners.org saying "Deferred irrevocable gifts should be reported only when assets are transferred to the gift instrument." As you all know, an immediate CGA is a deferred and irrevocable gift. My university's business office transfers the funds to the CGA vehicle at a local financial institution within a few days of my receiving the check from the donor. So, per charitablegiftplanners.org, this would lead me to report on it at the end of the year as cash-in-the-door. "Double counting" within a fiscal year comes to my mind.

    Is this transfer to the vehicle that I mention above indeed the moment the asset is ours and we report it as cash income?

    With gratitude,

    Stephen Lambert

    Susquehanna University



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    Stephen Lambert
    Susquehanna University
    lamberts@SUSQU.EDU
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  • 2.  RE: When you "actualize" an immediate CGA?

    Posted yesterday
    Your PGO should include documentation that establishes the gift's effective date. It is classified as a "planned" or deferred gift because the donor will receive an income stream for a period of time. That's why, when you record the gift in your CRM, you note two values: the face value of the transferred assets and the "present" value, or IRS deductible amount. The lower of these two is considered the payout stream. These are typically "counted" as of the date the assets are transferred. Your responsibility ends there.

    The Business Office can manage this as it sees fit. Usually, assets given for any planned gift "bypass" Advancement Services and are handled by the Business Office. Our CRM entry does not feed into the GL. Where I have worked, that was preferred because of the complex mechanics involved. In fact, at NC State, we outsourced all of these to a local bank that managed the assets, payouts, and 1099s.

    John

    John H. Taylor, Principal
    John H. Taylor Consulting, LLC
    2604 Sevier Street
    Durham, NC     27705

    919.816.5903 (cell/text)

    Serving the Advancement Community Since 1987




    Original Message


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