In this lesson, Nick Palazzolo, CPA, demystifies the financial concept of endowment funds within not-for-profit organizations, such as universities, and explains the accounting practices associated with them. He clarifies how these funds are structured, whether they have donor restrictions or are board-designated, and how such designations affect the treatment of assets. Nick also delves into the types of endowment funds, discussing those established in perpetuity or for a specified term, and provides tangible examples to illustrate how they are reported in financial statements. By breaking down the complex nature of endowment funds and their restrictions, he certainly makes the subject more accessible and understandable, setting the stage for a proficient handling of nonprofit financial engagements.
Lesson: Endowment Funds
In this lesson, Nick Palazzolo, CPA, demystifies the financial concept of endowment funds within not-for-profit organizations, such as universities, and explains the accounting practices associated with them. He clarifies how these funds are structured, whether they have donor restrictions or are board-designated, and how such designations affect the treatment of assets. Nick also delves into the types of endowment funds, discussing those established in perpetuity or for a specified term, and provides tangible examples to illustrate how they are reported in financial statements. By breaking down the complex nature of endowment funds and their restrictions, he certainly makes the subject more accessible and understandable, setting the stage for a proficient handling of nonprofit financial engagements.
Updated: Oct. 20, 2021 Create an account