The corpus of a given fund is generally not used to finance annual operating costs. Instead, the goal of most organizations with foundations is to develop the corpus without withdrawals, so that the underlying corpus increases in value over time and the interest earned is available each year for the specified purposes of the foundation. (Of course, one of the stated goals of a foundation could be to use interest to “contribute to the organization`s annual operating profit.”) When a foundation is established, there are usually guidance documents – such as a fiduciary instrument or other written documentation of the donor`s intent – or simply a corporate resolution of the board of directors – that define the foundation and express the guidelines. Guidance documents can literally restrict the use of funds (called “restrictions”). To begin with, what exactly are “foundations”? Foundations can generally be described as assets (usually cash accounts invested in stocks, bonds, or other investment vehicles) that are set aside so that the original assets (called “corpora”) increase over time due to interest income on the underlying invested funds. The body can also be added over time. Foundations are often used by large institutions such as universities and hospitals, but they can also play a role in the financial management and/or revenue strategy of a nonprofit. In accordance with the Endowment Agreement, all income from the endowment fund (including income and interest) that remains after the inflation adjustment of the endowment fund and that exceeds the expected long-term annual management costs of the bank property are retained by the foundation holder in the endowment fund and may be made available to the owner by the owner to finance unforeseen expenses and adaptive management needs. It is expected that a portion of the interest and income from the assets of the endowment fund will be reinvested in the endowment fund by the foundation owner in accordance with the foundation agreement. Foundation contributions received by the foundation holder must be paid into a fund and held in trust in accordance with the foundation agreement (Annex D-3). The Parties assume that any interest income from the endowment fund that goes beyond that used to ensure the inflationary growth of the endowment fund may be made available to the owner by the foundation holder to finance the long-term annual management of the bank assets in accordance with the endowment agreement.
After written approval by the undersigned bodies in coordination with the other members of the IRT and any necessary notification to the owner of the foundation in accordance with the foundation contract, the owner shall implement the approved revised administrative measures and tasks. .