CSOP 7.0 IU Gifts

SUBJECT:

Gifts to IU

SOURCE:

Capital Asset Management

ORIGINAL DATE

OF ISSUE:

June 2002

DATE OF

LAST REVISION:

February 2016

CSOP NO:

7.0

RATIONALE:

To provide guidelines concerning the depositing, recording and acknowledgement of all capital gifts received on behalf of Indiana University.  Policy FIN-ACC-40 states “When a gift has been received for Indiana University, the Indiana University Foundation (IU Foundation) Gift Administration Office must be notified.”

CSOP:

Capital Asset Management recognizes and capitalizes donated gifts from IU Foundation purchases and from Gift-in-Kind forms.

IU Foundation (IUF) Purchases

Gift-in-Kind

Gift object codes

Accounting transactions

Retirement of Gift Assets

Gifts given to an organization directly


IU Foundation Purchases
Indiana University Foundation (IUF) receives cash contributions. Those cash contributions are distributed, according to donor intent, into IUF departmental accounts. These contributions are used to purchase items by IU departments through IUF departmental accounts. By the 10th of each month IUF Accounts Payable prepares and sends to Capital Asset Management a gift spreadsheet of purchases made through Foundation departmental accounts.

The gift spreadsheet describes the purchased items and includes the following information:
  • Date of Acquisition
  • Cost
  • Vendor
  • IU Foundation Account Number
  • Department Name
  • Account Manager
  • Account Supervisor
  • Request Prepared by
  • Phone number
  • IU Account Number
  • Description of purchase
If the gift meets the university's capitalization rules, CAMS will create the gift asset using an Add Asset Document from the information presented on the gift spreadsheet (see CSOP 1.0 Capitalization Rules). The date of acquisition from the gift spreadsheet will be used as the create date of the gift asset. The description of purchase is used as the asset's description. If the IUF purchase is for a building or building improvement the asset description will be the building name per Bureau of Facilities. The IU account number listed on the gift spreadsheet is taken from the check request form submitted to IUF by the organization. This account number is not always appropriate to use during capitalization of the gift asset. CAMS Capital Asset Control Analyst will contact the organization to confirm the appropriate account number to record the gift asset.

The Add Asset Document will be routed to the account Fiscal Officer or Account Delegate for approval. If the account number or other information is incorrect, the Fiscal Officer or Account Delegate needs to disapprove the document and enter the correct information in the notes. According to the notes, CAMS will recreate the asset.

 

Gift-in-Kind
IUF receives non-cash contributions from donors. In order to record the gift on the donor record, gifts of personal property should be reported to IU Foundation Gift Administration via the Gift-in-Kind Transmittal form found at the following URL: https://iufservices.iu.edu/IQ/Edocs/GiftInKind.aspx.

 

The Gift Administration Office forwards copies of the Gift-in-Kind Transmittal forms to the University Capital Asset Office. IUF will only require the donor to provide an appraisal, per IRS guidelines, if the amount is greater than $5,000. However, the university will only capitalize these gifts if substantiation of value (appraisal) is provided.

The information presented on the Gift-in-Kind Transmittal form is used in creating the asset on an Add Asset Document. The account number presented on the Gift-in-Kind form will be used to create the asset. CAMS will not contact the department to verify this account number. Therefore, it is important for the Fiscal Officer or Account Delegate to confirm that the account number is correct before approving the Add Asset Document. The date received on the form indicates the date of physical delivery to IU and will be used as the assets' create date. The Gift-in-Kind Transmittal form will be scanned and attached in the notes section of the Add Asset document after redacting donor information.   

 

Gift-in-kind assets could include the following:

  • Moveable Equipment which includes software, cars, trucks, planes and boats
  • Art & Museum items such as paintings, antiques, artifacts and vases
  • Library books
  • Land
  • Buildings
  • Building improvements
  • Land improvements
  • Cash donations

Gift-in-Kind forms contain donor information. When CAMS creates the asset from the Gift-in-Kind form, donor information will not be used to protect the privacy of the donor.


Gift object codes

The type of gift will determine what object code should be used in the payment record on the Add Asset document.  Below is a listing of the appropriate object codes that Capital Asset Management will use to create the gift asset:

Type of Gift Object Code Capitalization Object Code Description
Moveable Equipment 7700 8610 Gifts of Capital Equipment
Art & Museum 7677 8615 Art & Museum Gifts
Library Books 7177 8613 Library Book Gifts
Land 7277 8603 Land Gifts
Building & Building Improvements 7377 8601 Building Improvement Gifts
Land Improvements 7477 8665 Land Improvement Gifts

Accounting Transactions
As indicated above the Add Asset Document is generated from the Capital Asset Management System and is used to create gift assets. The acquisition type of "G" identifies that the asset was a gift to the university. For example, when creating a capital asset from IU Foundation purchases or from Gift-in-Kind forms for library books the Add Asset Document will generate the following entries:

Account Number Object Code Description DR CR
12-345-67 7177 Library Book Gifts 5,000  
12-345-67 1175 Capital Gift   5,000
95-200-00 8613 Library 5,000  
95-200-00 9899 Fund Balance   5,000

Line one indicates the type of gift from the object code table above and generates the capitalization entries to object code 86xx and fund balance 9899. The 86xx and 9899 will appear on the balance sheet on the plant fund account according to the account organizational hierarchy. Income to 1175 will appear on the income statement on the operating account and will remain in income until fiscal year end at which time income closes to fund balance.

The Add Asset Document will route to the Fiscal Officer or Account Delegate for approval. Once the Add Asset Document is approved the gift asset will begin depreciating according to the university's depreciable life.

Retirement of Gift Assets
IU must report information to the IRS about dispositions of charitable deduction property made within three years after the donor contributed the property.  Each quarter Capital Asset Management will run an asset retirement analysis.  Any gift assets retired within three years will be reported to IUF Gift Administration.  Upon notification, IUF will complete the IRS Form 8282, send a copy to the IRS and to the donor.  The 8282, Donee Information Return can be obtained and viewed from the IRS web site at the following URL http://www.irs.gov/.

Gifts given to an organization directly
If an organization receives a gift directly, IU requires the organization to contact IU Foundation Gift Administration to request a Gift-in-Kind Transmittal form or submit the form directly at the following URL: https://iufservices.iu.edu/IQ/Edocs/GiftInKind.aspx.

 

DEFINITIONS:

Equipment-The term “equipment” includes delivery equipment, office equipment, machinery, furniture and fixtures, factory equipment and similar fixed assets.

Gifts-in-kind- Non-monetary items of tangible personal property such as art, collectibles, books, equipment, automobiles, other assets or materials which represent value to the University and the Foundation.

CROSS

REFERENCES:

CSOP 1.0 Capitalization Rules
Policy FIN-ACC-I-40 Charitable Gifts to Indiana University
Policy FIN-ACC-I-45 Donor Intent Responsibilities

RESPONSIBLE

ORGANIZATION:

Organizations that receive gifts.