Financial Policies Training:
Gifts-in-Kind to the University (2.1.10)
Effective: November 17, 2009
These PowerPoint slides are intended for training purposes. In
the event of any discrepancy or interpretation difference
between the policy and the slides, the policy dictates.
Gifts-in-Kind to the University (2.1.10)
Topics:
What is a gift-in-kind?
Why is a gift-in-kind policy needed? Are any exceptions to
this policy allowed?
What is the process for accepting a gift-in-kind?
Other considerations in accepting a gift offer? What gift
offers should be declined?
How are accepted gifts-in-kind valued?
Is an appraisal required?
What are the standards for appraisals?
What is UC Foundation’s role?
Are there special types of gift-in-kind contributions?
Gifts-in-Kind to the University (2.1.10)
What is a gift-in-kind?
Contributions – transactions in which one entity
makes an unconditional voluntary transfer to
another entity without receiving equal value in
exchange
Examples of gift-in-kind contributions
Tangible personal property (e.g., equipment, antiques)
Intangible personal property (e.g., patents, copyrights, software
licenses)
Real estate
Gifts-in-Kind to the University (2.1.10)
Why is a gift-in-kind policy needed?
Provides assistance in recognizing and
accepting gifts-in-kind per Board Rule 10-21-01
Supplements UC Foundation’s gift acceptance
policy
Are exceptions to this policy allowed?
All exceptions to policy 2.1.10 require approval
by the Senior Vice President of Administration
and Finance
Gifts-in-Kind to the University (2.1.10)
What is the process for accepting a gift-inkind?
Conduct review to show property
Is readily marketable (can be sold)
-ORIs needed by university (can be used internally)
Coordinate acceptance with UC Foundation
May also require approval of General Counsel,
Director or Real Estate, Purchasing or others
For gifts of $5000 or more, provide copy of all
documentation to Controller’s Office for
recording in UC Flex
Gifts-in-Kind to the University (2.1.10)
Other considerations in accepting a gift
offer?
Potential ethical issues
Major uncertainty about existence of a value
If any financial, promotional or other
consideration is paid or given to the
donor/vendor/provider – it is not a gift-in-kind
What gift offers should be declined?
Property that can’t be used internally or sold
quickly
General rule: automobiles, boats, livestock
Gifts-in-Kind to the University (2.1.10)
How are accepted gifts-in-kind valued?
(Easily sold or used)
Fair market value
Assigned a value for internal
accounting purposes only
(Not easily valued)
(Equipment and software)
value (i.e., what
Educational discount
UC would have paid if purchased)
For software, the educational discount value as documented in
writing from vendor
If no educational discount value on software, it is the established
retail value in relation to the number of concurrent users
Gifts-in-Kind to the University (2.1.10)
Is an appraisal required?
If gift is $5000 or more and donor wants
Foundation acknowledgement
An independent appraisal is required
If gift is valued at $5000 or more and
produced/manufactured by entity making the
contribution
An itemized inventory list, invoice or letter from
vendor/donor or published info on value of items is
required
For gifts having no qualified appraisal, UC does
not include a value on the donor receipt
Gifts-in-Kind to the University (2.1.10)
What are the standards for appraisals?
Independent appraisers
UC does not perform appraisals
UC will not pay for appraisals of contributed
assets
Must comply with IRS guidelines
Must be no earlier than 60 days prior to the date
of the gift
If the appraisal lists a range of values, the
recorded value is the midpoint
Gifts-in-Kind to the University (2.1.10)
What is UC Foundation’s role?
Work with the organizational unit being offered
the gift regarding acceptance and eligibility
Assure a gift is appropriately recognized within
the university donor recognition framework
Execute any IRS forms required for
acquisition/disposition of gifts of real or personal
property
Gifts-in-Kind to the University (2.1.10)
Are there special types of gift-in-kind
contributions?
Software
Services
Use of long-lived assets
Gifts-in-Kind to the University (2.1.10)
Software that serves the academic or
research purpose of the university
The terms of the agreement determine if
the transaction is a gift:
Must be an irrevocable license and in writing
No gift if license must be renewed later
Upgrades in future with higher value –
considered additional gift
Gifts-in-Kind to the University (2.1.10)
Contributed services
Not considered gift-in-kind (per OH state law)
Professional design, engineering, construction services
May be considered gift-in-kind
Advertising and promotions
How is eligibility determined?
UC Foundation
If services
(w/ input from General Counsel, Purchasing, org unit to benefit)
Create/enhance a non-financial asset
Service would need to be purchased if not donated
Gifts-in-Kind to the University (2.1.10)
Use of long-lived assets
Unconditional promise for use of (for example) a
building or facility
For a specified number of periods
Donor retains legal title
May be received in connection with a lease with
payments below fair rental value or may be similar to a
lease with no lease payments
Contribution reported: difference between fair
rental value & stated amount of lease payments
Gifts-in-Kind to the University (2.1.10):
Resources
Policy (2.1.10): ww.uc.edu/af/documents/policies/giftsinkind.pdf
or go to the Financial Policies home page www.uc.edu/af/policies
Policy questions e-mail:
policyquestions@uc.edu
University Board Rule 10-21-01
www.uc.edu/trustees/rules/RuleDetail.asp?ID=98