Samples, Research & Tools
Revisions to the CASE Standards, March 2008

The CASE Board of Trustees approved the following revisions in March 2008. They were published in the CASE Reporting Standards & Management Guidelines, 4th ed. Please see the press release and FAQs for additional information.

 

FORMER LANGUAGE
Language from the 3rd edition of the CASE Management and Reporting Standards for both annual and campaign reporting

NEW LANGUAGE
Approved revisions applied to campaign reporting; effective with the fall 2008 CASE Survey of Educational Fundraising Campaigns

REVOCABLE GIFTS
Revocable and legally unenforceable gifts will not be included in official fundraising totals reported to CASE and CAE (Counting of Revocable Gifts, page 20)

REVOCABLE GIFTS
Revocable gifts may be included in campaign totals at face value if they are pledged during the campaign, documented, and reported separately from outright gifts and irrevocable deferred gifts.

Background and recommended practices

The practice of counting revocable gifts is beneficial because it deepens relationships with donors and sets the stage for future support. However, to avoid basing a disproportionate amount of the campaign on revocable gifts, CASE recommends setting specific goals for revocable gifts at the outset of the campaign. CASE also recommends periodic verification of the gift.

Appropriate documentation might include a commitment in writing from the donor, his or her attorney or financial adviser, or a copy of the bequest intention, retirement plan, or other document outlining the ultimate source of the gift. Documentation should include a statement about the assumed value of the gift.

If a revocable gift is realized or becomes an irrevocable deferred gift during the campaign in which it was pledged, the value of the gift should be subtracted from the revocable commitment category and added in the appropriate category as an outright or irrevocable gift. If a revocable gift is realized during a future campaign, only amounts not attributed to the original campaign may be counted in the new campaign.

Institutions may want to consider age requirements for inclusion of these types of gifts. For example, no inclusion if the intended donor is less than 50 years of age; inclusion at discounted value if individual is between 50 years of age and 69 years of age; inclusion at full face value if 70 years of age or older.

In the case of externally managed irrevocable life income trusts that allow the donor to change the charitable beneficiary, because the designation is not irrevocably pledged to the institution, it should be counted as a revocable gift, at face value, and in the revocable gift category.

IRREVOCABLE DEFERRED GIFTS
Irrevocable, legally enforceable deferred gifts will be reported at discounted present value in accordance with existing Internal Revenue Service (IRS) and Canada Customs and Revenue Agency (CCRA) methodologies. (Counting of Irrevocable Gifts, page 20)

IRREVOCABLE DEFERRED GIFTS
Irrevocable deferred gifts may be included in campaign totals at face value, but both current face and discounted present values should be reported. Present value is calculated according to the IRS standards.

Irrevocable deferred gifts should be recorded separately from outright gifts and revocable gifts.

In the case of externally managed irrevocable life income trusts that allow the donor to change the charitable beneficiary, because the designation is not irrevocably pledged to the institution, it should be counted as a revocable gift, at face value, but in the revocable gift category.

In the case of charitable lead trusts, which make contributions over time, the face value of the payment stream should be recorded as a pledge in the year that it’s given, and annual income should be recorded as pledge payments as they are received regardless of the length of the trust.

Background and recommended practices

CASE recommends reporting irrevocable deferred gifts at both the face value and discounted present value for the following reasons:

  • Reporting both values accurately and transparently reflects the funds donated by individuals (face value) and the fundraising activity of the institution as well as the long-term estimated benefit to the institution (present value) by a standardized methodology (IRS charitable deduction calculation). In addition to calculating the IRS discounted value, institutions may want to use the NCPG method for calculating the future value in today’s dollars based on their investment in the trust.
  • Planned giving can be a powerful way to raise donors’ sights while at the same time meeting long-term funding needs of the institution. Counting gifts at face value helps to recognize the power planned gift vehicles can have in reaching important campaign goals and raising both institutional and individual sights. Reporting the gifts at discounted present value is a transparent way to distinguish them from outright gifts available to fund immediate needs of the institution.
  • Reporting planned gifts only at present value may have the unintended consequence of devaluing them in the donor’s mind while reporting them only at the face value may have the unintended consequence of overvaluing them in comparison to outright gifts.

Institutions should establish policies or guidelines to set minimum ages and number of beneficiaries for irrevocable planned gifts that are to be counted in the campaign. This ensures that the terms for each planned gift makes good financial sense for the institution. (For example, it likely does not make sense to establish a charitable remainder trust with four or five multigenerational income beneficiaries for a 30 year old.)

Planned gifts by their very nature provide for the future health of an organization with many institutions using planned giving strategically to build their endowments. The percentage of a campaign goal that should consist of planned gifts varies from institution to institution and depends on strategic priorities and goals.

CONDITIONAL PLEDGES
Only legally enforceable unconditional pledges, and promises to give as identified by FASB and GASB, are to be counted and reported to CASE and CAE. (CAE asks for annual pledge totals only as an optional, informational item. Pledges are not included in total giving figures for VSE purposes.) “Conditional” pledges, as outlined by FASB and GASB, are those that place requirement on the institution to perform some task or take some action that it might not otherwise initiate, e.g., “I will commit $1 million to your campaign provided you release your football coach.”……. (Pledges, pgs. 39-40)

CONDITIONAL PLEDGES
Conditional pledges may be included in campaign totals if…

A. There is a reasonable expectation that the conditions under which the pledge is made will be met during the campaign period. Examples of conditional pledges are challenge gifts, gifts for capital projects (if pledge is conditional on either raising other funds or moving forward with the plans to build or renovate), and pledges that are non-binding on the donor’s estate.

B. There is appropriate documentation, most likely in the form of a gift agreement. The documentation should include dollar amounts and a payment schedule.

Conditional pledges should be recorded as revocable gifts, which should be recorded separately from outright gifts and irrevocable deferred gifts.

Background and recommended practices

An appropriate executive committee (e.g., Campaign Steering Committee) should review conditional pledges before they are formally accepted and recorded.

An oral pledge should not be confused with a conditional pledge as they are not the same. On the matter of oral pledges, the Campaign Standards Working Group makes no recommendation of change to CASE’s guidelines in this area.

CAMPAIGN LENGTH
The campaign period is the total time encompassed by the active solicitation period for the campaign, including the advance-gift phase. CASE recommends that no campaign period exceed seven years in duration. Shorter campaign periods are often preferable to longer ones as they result in having the greatest immediate financial impact on the institution. (Term/Length of the Comprehensive Campaign, page 79)

CAMPAIGN LENGTH
Campaigns should be tied to the strategic goals and priorities of the institution and, for this reason, the length of a campaign may vary. However, in order to maximize the commitment of volunteers, donors, staff and others, and to keep campaigns aligned with articulated funding priorities, CASE recommends that a comprehensive campaign period generally not exceed eight years. Targeted campaigns usually have a shorter timeline. The “campaign period” refers to the total time encompassed by the campaign, including both the advance-gifts and public phases.

GOVERNMENT FUNDS
Exclusion:
Government funds, whether local, state (including state matching grants), federal or foreign. This includes distributions from Indian Tribal Governments, including payments from Indian Tribal Enterprises acting as conduits for those governments; these entities should be treated similarly to transactions from state governments. This exclusion also applies to contributions from cities or regional governments, even though those entities may be incorporated. (Counting of Government Support and Matching Gifts, pgs. 26-27)

GOVERNMENT FUNDS
Government funds are very important to helping institutions achieve their strategic goals. They are often secured competitively and help leverage private funds. Fundraising staffs often are integral to securing government support. However, CASE reaffirms its position that comprehensive campaigns are fundamentally philanthropic ventures designed to raise resources from the private sector. Therefore, securing government funds does not fall under the definition of philanthropy as a private act. For this reason, government funds should not be included in campaign totals, but institutions should work to raise visibility and recognition for the value of government funding in accomplishing institutional goals.