UW System Trust Fund Investment Transfers

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Policy Number:
UW-3011
Old Policy Number:
132
Responsible Office:
Accounting Services, Division of Business Services

University Policy

Rationale/​Purpose:

UW–Madison has a responsibility to assure appropriate stewardship of trust fund assets that support the university and to ensure compliance with state laws and the UW System policies and procedures regarding trust fund assets.

Scope:

Applies to all UW–Madison personnel involved in the receipt and use of trust fund assets held in fund 161 and 162. Campus and divisional leadership have a responsibility to ensure individuals involved in accepting and/or using trust funds assets are fully informed and understand this policy and the policies and procedures listed on the Office of Trust Funds website.

Policy:

Policy Summary

This policy defines the principles for interacting with the UW System Office of Trust Funds in regards to investment transfer requests between the 161-Income Cash Fund and the 162-Long Term Fund.

Policy Detail

Investment Options

As of March 31, 2018, there are two investment options for trust fund assets: the 161-Income Cash Fund and the 162-Long Term Fund. Trust fund account/project holders will be able to invest fully expendable monies in the Long Term Fund, in part or in whole, if a longer-term orientation is appropriate. Requests to transfer monies to the Long Term Fund should be communicated to the Office of Trust Funds, which will consult and advise as appropriate.

Investment Transfers

This policy describes how departments/units are to initiate investment transfers, i.e., transfers from the Income Cash Fund to the Long Term Fund, or from Long Term to Income Cash.

UW System Trust Funds updates the market value of the Long Term Fund only as of the end of each calendar quarter. Accordingly, this is also when transactions for the fund are processed – i.e., new contributions, withdrawals, and fee/expense assessments. The determination of these quarter-end figures, the related accounting allocations and journal entries, and the actual movement of invested dollars normally take place within ten business days following each quarter-end close.

To affect investment transfers between the Income Cash Fund and the Long Term Fund, the following steps should be followed:

  1. If desired, consult with the Office of Trust Funds, who can advise on investment-related questions, the investment parameters of the Long Term and Income Cash Funds, and the appropriateness of various Fund allocations. Contact the Director and/or Senior Accountant at the Office of Trust Funds (see UW System Trust Funds website).
  2. Submit requests for investment transfers to the Office of Trust Funds in writing, no later than five business days before quarter-end for the transfer to occur at that quarter-end. Requests received after that deadline will not be processed until the subsequent quarter's end.
  3. Written requests for investment transfers should be in the form of a memo, approved and signed by the Divisional Financial Leader or higher level. These requests should be sent or emailed to the Director and/or Senior Accountant at the Office of Trust Funds (see website).

Note the following when contemplating transfers for the various classifications of Trust Funds accounts/projects:

  • There are no restrictions as to the investment of or investment transfers for, fully “Expendable” accounts.
  • For “Endowment” or “Designated Endowment” accounts, the Long Term Fund portion (the endowment principal or corpus) may never be withdrawn or transferred.
  • For “Endowment” or “Designated Endowment” accounts, the Income Cash Fund portion represents the spending distributions made from the Long Term Fund on a regular basis. While a department/unit may decide to transfer (or reinvest) Income Cash Fund monies back to the Long Term Fund, these monies will then become a permanent part of the principal/corpus and can never be withdrawn or transferred thereafter.

Consequences for Noncompliance

Noncompliance with this policy or related procedures may result in additional controls being placed on access to trust funds assets, and/or discipline through established employment policies.

Responsibilities

  • Dean/Director’s Office: Serves as a liaison between the campus department and UW System Office of Trust Funds, and provides authorization for investment transfers.
  • Division of Business Services, Accounting Services, Director of Financial Information Management: Serves as a liaison between the campus department and UW System Office of Trust Funds when necessary.
  • UW–Madison Campus Personnel: Determines proposed investment transfers and provides transfer request and supporting documentation to its divisional dean's/director’s office for approval.
External References:

Policy Administration

Approval Authority:
Assistant Vice Chancellor of Business Services and Controller
Policy Manager:
Gift Management Accountant
Contact:
Gift Management Accountant -- April Cook, giftmgt@bussvc.wisc.edu, (608) 262-0726
Effective Date:
09-21-2018
Revised Dates:

09-21-2018

Reviewed Dates:

09/21/2018

Retrieved:
01-22-2025 22:46:39