To document policies regarding pledge agreements, reserve balances, past due pledges, and pledge write-offs.
May, 2023Responsible Office
It is University policy that all pledges for a multi-year restricted gift of $25,000 or more be memorialized in a clear and comprehensive written pledge agreement. A signed pledge agreement or approved equivalent sets expectations and responsibilities for the donor and the University by outlining the intent of the gift, a payment schedule, stewardship obligations, and any special conditions regarding the gift. For spendable unrestricted gifts less than $100,000, the University will accept written notification from a donor of the terms of the gift, which includes: gift amount, fund name, payment schedule (up to five years) and country of citizenship or incorporation.
It is University policy that a standard pledge payment schedule for a multi-year gift of $25,000 or more is five years with equal payments each year. Donors may pay over a shorter period of time. If a donor requests a payment period greater than five years, approval is required by a dean or Center director, and/or the Vice President, Development and Alumni Relations (DAR). An extended payment schedule will be granted only under exceptional circumstances. If a payment schedule for an existing pledge is renegotiated for a new fulfillment period longer than five years, it requires the same approval by the parties listed above.
Approval and Signature Requirements
All draft agreements and all documentation for spendable unrestricted gifts from $25,000 to $99,999 must be submitted to the Office of Gift Management for review and approval prior to acceptance and, if required, signatures being obtained. The required signatures for gift agreements are:
All original, signed documents must be sent to the Office of Gift and Investment Services for safekeeping. Documentation will be kept on file and made readily accessible to auditors during the lifetime of the pledge.
The Office of Gifts Accounting & Administration generates reports of outstanding past due pledges for development officers and senior business administrators to review. Following the review of these past due pledges, development officers must make attempts to contact donors in order to resolve outstanding past due balance.
Revisions to pledge payment schedules may be made under certain circumstances, as follows:
There must be a change in a donor’s financial circumstances or other extenuating factors that preclude payment on the original schedule.
Prior approval is required by the Vice President, Development and Alumni Relations for a pledge adjustment of $500,000 or more. For building projects or other restricted gifts of a time sensitive nature, the School/Center business administrator must also approve. If a revised payment schedule for a pledge of $1,000,000 or more includes a fulfillment period of more than five years, it must be approved by the dean or Center director and the President.
The Associate Treasurer must be notified, in writing, of the new terms of any agreement of $1,000,000 or more.
New payment schedules must be in writing and signed by the donor or confirmed by donor email.
If a donor is unwilling or unable to fulfill a pledge, the pledge is classified as uncollectible. Pledges should be written off when there is relative certainty that no further payments will be received. The University will write off a pledge under the following circumstances:
There must be documentation from a donor or the development officer who attempted to obtain such documentation evidencing the donor’s intent to cease future payments
A pledge of less than $25,000 will be automatically written off one year after its maturity date.
A pledge over $25,000 up to $250,000 will be sent to DAR for review one year after its maturity date and written off unless DAR determines that the pledge should remain active.
For pledges between $25,000 and $500,000, the decision to write off will be made by the Associate Treasurer and Senior Director of Gift Management.
For pledges over $500,000, the decision to write off is made by the Vice President for Development and Alumni Relations and Vice President for Finance and Treasurer.
Pledges in excess of $5,000,000 which are written off are reported to the University’s outside audit firm quarterly by the Vice President for Finance.
DAR may reserve certain pledges which have not been recorded for financial statement purposes. These pledges have no financial statement impact and are not expected to be collected. Annually in October all non-financial pledges due by June 30th of the previous year will be written off. Multi-year non-financial pledges in excess of $25,000 will follow the financial pledge review process.