Types of Charitable Transactions

There are multiple ways to count the money that we raise and receive from donors, and we must be careful not to over-count in reports. If a donor makes a pledge of $100,000 and has paid $100,000 against that pledge, we would not want to double-count that as $200,000. Because of this, we need to understand the types of transactions we might see used for each counting methodology.

Gifts

One-time payments are payments made directly to the university. This can be cash, check, credit card, stock, etc. One-time payments also include recurring gifts and matching gifts.

Gifts-in-kind are a non-monetary gift to the university of a tangible “thing” (e.g., art, livestock, equipment).

Unreported realized bequests are payments made directly to the university from the estate of a deceased constituent where the university had no prior record of the gift, or where the amount of the payment was more than the bequest expectancy (see notes on expectancies below).

Pledge and planned gift payments are also a type of gift.

Commitments

Basic pledges are a promise to pay the university a sum of money in the future within a particular time frame (usually 5 years, broken into installments for payments).

Sponsored grants are a promise to pay the university, usually from a non-human constituent (e.g., professional foundation, trust) for a certain philanthropic outcome. These grants are used for a particular purpose, typically research.

Conditional pledges are a promise to pay the university if a particular event occurs; typically a challenge pledge (e.g., a constituent offers to give $50,000 if the university can also raise $50,000).

Note that the term “pledge” is typically used for legally binding giving instruments and may not include conditional pledges or sponsored grants. The term commitments refers to pledges, conditional pledges, and sponsored grants. However, frequently the terms are used interchangeably. 

For pledges, sponsored grants, and conditional pledge commitments, [Revenue Application Amount] is the full commitment value. [Pledge Application Balance Due] is the amount still owed. [Pledge Application WriteOff Amount(+)] is the amount removed from the original pledge balance if the constituent reduces their pledge amount or stops payments.

Pledge overage payments are either applied to the remaining pledge balance to reduce the final payment amount, or the extra funds are received as a one-time gift.

Expectancies

Life-income agreements (LIA, split interest gift) are a planned gift that makes payments to the donor and/or other beneficiaries for life or a term of years, then distributes the remainder to the university. These may take the form of charitable gift annuities, charitable remainder trusts, charitable remainder unitrusts, and pooled income funds.

Bequests and retirement assets are a transfer, by will, of property such as cash, securities, or tangible property to an individual or a charitable organization. There is no gift to the university until the donor is deceased. These may be revocable or irrevocable.

Life insurance are gifts expected to be made to the university from life insurance purchased by the constituent; the insurance premiums are paid for by the constituent.

Note that “planned giving” and “expectancies” are used as interchangeable terms. [Revenue Application Amount] is the full expectancy value. [Pledge Application Balance Due] is the amount still owed.

Note that planned gift overages are received as gifts, and the overage is not applied to the planned gift.

Table 3. Fields and values used to identify types of expectancies.

Recurring Gifts

Recurring gifts are gifts that are made on a scheduled basis. They are defined by a fixed payment/installment amount rather than a fixed total amount - the university receives a set amount of money from that donor on a recurring basis until the donor ends the recurring payments.

For recurring gifts charged directly by OUD, there is a record for the recurring gift setup (similar to a pledge); for recurring gifts charged by other units or systems, the recurring gift payments appear as one-time gift payments with specific channels indicating that they are recurring. 

Donors see their recurring gifts as recurring whether they are charged through OUD, or through other channels. When doing an analysis that involves recurring gifts, clarify whether this should be only recurring gift payments charged through OUD, or whether it should also include payroll deductions, MPUB recurring gifts, etc. The criteria to determine if someone has any ‘active’ recurring gifts when there is not a recurring gift setup to reference is whether someone has a payment meeting any of the recurring gift payment criteria (see below) in the current or prior month.

Matching Gifts

There are three components of a matching gift: the original gift being matched, the matching gift setup, and the matching gift payments. The original gift is an outright gift (not a commitment or expectancy), as outlined in the Gifts section.

Some companies pay each and every claim as they receive them, while others only pay once per year and combine multiple claims in one payment (sometimes even hundreds of claims in one payment).

Some gifts are matched through a third-party, in which case the Revenue Channel will be ‘Third Party Corp & Matching’, and the Comment on the transaction will say Benevity or YourCause (YourCause is no longer used).

For additional details on matching gifts, see this Matching Gifts article.