Purpose

To outline the authority and responsibilities in matters of charitable gift acceptance, and to provide guidance to employees, volunteers and members of the Board of Regents.

Scope

Charitable donations to the University and separately incorporated entities (SIEs).

Definitions

Advantage — What a donor may receive in return for his or her donation (e.g., a meal, tickets to a show etc.), and it must be taken into consideration when determining the eligible amount of a gift for receipting purposes.

Determining the Fair Market Value of an advantage is similar to determining the Fair Market Value of a Gift in Kind. However, while only donations of property can be receipted as Gifts in Kind, the Fair Market Value of any type of advantage (e.g., services, accommodation, meals etc.) must be taken into consideration when determining the eligible amount of a gift for receipting purposes.

Beneficiary (Trust, Life Insurance Policies, And Registered Funds) — The person for whose benefit the trust was created. For Charitable Remainder Trusts, the donor is normally the income beneficiary (income interest) and the University is the capital beneficiary (remainder interest). The University may be the beneficiary of life insurance policies and hence is entitled to the death benefit. Furthermore, the University may also be named the beneficiary of Registered Retirement Saving Funds.

Bequest — Property received from the will of a deceased person.

Canadian Cultural Property — Any property that has been certified by the Property Export Review Board. Gifts of Cultural Property are subject to enhanced tax benefits.

Charitable Remainder Trust — A planned gift where the donor transfers property into a trust. The donor retains a life interest in the property but makes an irrevocable gift of the residual interest to the University. An official tax receipt can be issued for the fair market value of the residual interest in the property at the time that the residual interest vests with the University. At no time may the capital of the trust be encroached upon by anyone.

CRA — Canada Revenue Agency.

Designated/Restricted Gifts — Are intended to promote and carry on the work of the University as per the terms of the donor's gift.

Donation — A charitable gift, according to Canada Revenue Agency guidelines.

Eligible Amount — The amount that the Fair Market Value of the property gifted exceeds the amount of the advantage, if any, received by the donor with respect to the gift. The eligible amount is the amount claimed on the donor’s tax return.

Endowment Funds — Donated money invested in perpetuity. The capital of the endowment remains untouched, and only the income earned on the investment is used to support the intention of the donor. Oversight of the investment strategy of the endowed pool is provided by the Audit and Finance Committee of the Board of Regents and informed through the works of its investment sub-committee.

Fair Market Value — The price at which a fully-informed seller, who is under no compulsion to sell, would be willing to sell an asset to a fully- informed buyer, who is under no compulsion to buy, where both parties are acting independently of each other. Fair market value does not include any amounts paid or payable to other parties such as sales agents or sales taxes such as HST, GST and/or PST.  

Gift (outright) — For the purposes of this Policy, a gift means a voluntary cash transfer and/or in-kind transfer, from individuals, industry, foundations and other sources irrevocably given to the university. Gifts are made without any expectation of tangible return to the donor (as defined by CRA) or to anyone designated by the donor. Gifts may be monetary (cash or cheques) or non-monetary (e.g., securities, real property, or personal property.)

Gift Agreement — A written agreement between a Donor and the  University outlining the conditions and terms of the gift, including, but not limited to, designation, gift type, pledge schedule, and fund type (endowed, term, annually funded or one-time).

Gift in Kind (also known as non-cash gifts) — Are gifts of property. They cover items such as real estate, artwork, equipment, securities and cultural and ecological property.

A contribution of service, i.e. a commitment of time, skills or efforts, is not property and therefore does not qualify as a gift or Gift in Kind for the purposes of issuing official donation receipts.

Life Insurance — Gifts where a life insurance policy is purchased with the University as the owner, ownership is gifted to the University at a later date, or the death benefit is assigned to the University as a beneficiary. A tax receipt may be issued for the premiums paid only when the University owns the policy. The University will not own or accept ownership of any Life Insurance policy that is not a permanent policy.

Pledge — A commitment or promise, typically in writing, to make a gift at a future date(s). A pledge commitment is not legally binding in Canada.

Premiums, Life Insurance Premium — Cash payment that is required to fund an insurance policy. Premiums are generally required for the lifetime of the insured. Depending on the type of insurance policy, the Premiums are normally paid by the donor.

Publicly Traded Securities — Shares, warrants, rights or debt obligations that are traded on a prescribed stock exchange.

Receipt — Registered charities can issue official donation receipts (also referred to in this policy as "tax receipts") to acknowledge gifts. An official donation receipt is subject to particular requirements under the Income Tax Regulations including identification that it is an official receipt for income tax purposes. See the definition "Eligible Amount" of gift for further information.

Note: Memorial University also issues other forms of receipts to acknowledge acceptance of services or items that are not gifts. These are not tax receipts and are clearly distinguished from the tax receipts issued to acknowledge gifts.

Recognition — Actions that communicate to the donor or the public a form of acknowledgement that express gratitude and appreciation from the University on receiving a gift. 

Term Funds — A pool of funds set aside for a specific future purpose. Funds may be spent all at once for a specified future purpose of spent down over a specified number of years as per the terms of the agreement that establishes the term fund.

Unit — Academic or administrative unit as defined in the University Calendar.

Unit Head — Term used to refer to the leader of any academic and non- academic unit (Dean level or higher or administrative equivalent).

University — Memorial University of Newfoundland ("University").

Unrestricted Gifts — Are intended to promote and carry on the work of the University with no restrictions as to the use or administration of the funds.

Policy

1.0 GENERAL

Fundraising practice at the University is donor-centered and encourages donors to make outright gifts to the University. The University welcomes the donation of charitable gifts which enable it to fulfill its mission, vision and values. While the university appreciates the generosity of prospective donors, the University may not be able to accept every gift.

The University has a responsibility to be accountable in fundraising and accepting philanthropic donations. A description of the types of gifts accepted, and the principles that guide professional fundraising staff and volunteers are described in this policy. 

The ownership and management of all gifts resides with the university, whether for the benefit of the university generally or   for some specific purpose. Gifts should not entail unacceptable financial or other risk   and burden the university. Unacceptable financial or other risk or burden would be decided upon by a vice-president, in consultation with the appropriate Unit Head or the senior leadership group.

The authority to decline a gift rests with the President (and, where deemed appropriate by the President, in consultation with the Board of Regents) except as noted in the procedure for gifts of either fine art and/or art and cultural property. The University reserves the right to decline any gift, at any time, for any reason.

The President may consult with the Executive Director, Office of Development and Alumni Engagement. In certain exceptional situations, and as per CRA regulations and guidelines, the University may return a gift to the donor. The authority to do so, assuming it meets CRA guidelines, rests with the President.

The University does not accept gifts that require it to provide any valuable consideration to the donor, or anyone designated by the donor, such as employment in the University, enrolment in a university program, or a university procurement contract.

The gift solicitation process is addressed in the Donor Prospect Clearance Policy. Recognition via naming for gifts is addressed in the Naming Opportunities Policy.

2.0 LEGAL FRAMEWORK

The University makes informed decisions about the acceptance of gifts, in accordance with the following considerations:

• alignment with the university's strategic priorities;
• preservation of the university’s integrity, autonomy, and academic freedom;
• federal and provincial laws and regulations;
• efficient administrative, legal and accounting practices; and,
• impact on the University's reputation.

Accurate reporting of all gifts and consistent, ethical and equitable relations with all donors are required. As a registered Canadian charity, the University abides by the rules and regulations of the Canada Revenue Agency (CRA).

The University’s Canadian registered charitable number is 10769 0273 RR0001.

3.0 ACCOUNTABILITY

Gifts to the University shall be reported in a manner consistent with the principles recommended by the Canadian Association of University Business Officers (CAUBO), the Council for the Advancement and Support of Education (CASE), the Canadian Council for the Advancement of Education (CCAE) and the Association of Fundraising Professionals (AFP). 

The Office of Development and Engagement is solely responsible for issuing official charitable tax receipts for the eligible amounts of all charitable gifts received by the University consistent with the requirements of the Income Tax Act (Canada), Canada Revenue Agency guidelines and in accordance with procedures established by the University.

The Office of Development and Alumni Engagement maintains records required by Canada Revenue Agency. Access to these records is restricted to appropriate staff, senior executives and others acting in an official capacity in specific conditions on behalf of the University.

4.0 CONFIDENTIALITY

All matters relating to donors, gifts and gift activity shall be handled with confidentiality and in accordance with the Access to Information and Protection of Privacy Act, other legislation to which the University is subject and University policies. All persons involved in any process related to this policy are expected to maintain confidentiality.

5.0 GUIDING PRINCIPLES IN ACCEPTING GIFTS

Conflict of Interest

Any real, potential or perceived conflicts of interest must be handled in accordance with the Conflict of Interest policy.

Ethics

All professional staff and volunteers who may be fundraising on behalf of the University must conduct themselves in accordance with an applicable code of conduct and ethics, as outlined in the AFP Donor Bill of Rights and the CASE Statement of Ethics.

Legal and Professional Counsel

While the University may encourage donors to seek independent counsel, such as in the case of negotiating a major gift, at no time does the University warrant or certify the competence or integrity of any independent counsel.

Related Documents

Memorial University’s vision, mission, and values
Donor Prospect Clearance Policy
Conflict of Interest policy
Access to Information and Protection of Privacy Act
Canada Income Tax Act
Canada-United States Tax Treaty 
 

Procedures: