If an offer of support appears to fall between a research grant and donation, it is important to seek advice from Finance Division or ROO, because certain benefits to donors (use of logos, rights to attend seminars, access to academics) may trigger trading issues that need to be resolved.
Once income has been identified as being a research grant then no part of this can be treated as a donation. The money is either a donation or a research grant, not both.
This is supported by Financial Regulation 13.3:
'All research grant or contract income and expenditure, from whatever source of funds, must be notified to the Research Office and no part of this income may be transferred into donation accounts or other special funds, other than funding remaining unspent at the end of the research which the funder has agreed the Department may retain.'
Detailed guidance on the classification and management of Research Grants (M*** source of funds) is provided in the Research Grants chapter of the Financial Procedures Manual.
Excess research grant income
This is credited to source of funds EDBA and EDFF in departmental accounts and is not a donation. It is still part of the original transaction by the University to the sponsor of research.
Although potentially confusing, the last part of Regulation 13.4 is making provision for the scenario where we are required to return any unspent funding to the sponsor but, where the sponsor then specifically states that they wish to donate a corresponding amount back to the University. In practice the money may never leave the University however, it is technically two separate transactions. In these rare cases departments should liaise with both ROO and Central Finance as any monies would need to be transferred to either an H or E source of funds code.
If the University receives sponsorship income it is obliged to acknowledge the involvement of the sponsor. To the extent that this returns a benefit to the sponsor the income is not a donation. For advice on the split between donations and sponsorship income (and related VAT status), refer to the Tax and Property team in the Finance Division.
Grants from the Higher Education Funding Council for England (HEFCE) and the Teacher Training Agency (TTA), whether tied to specific initiatives and with restrictions on expenditure, are not treated as donations. The J*** source of funds is used to identify these monies received and the associated expenditure. More guidance is available in section 2 of the Chart of Accounts chapter of the Financial Procedures Manual.
As stated earlier, trading income is income earned by a department from either another university department or an external customer, for the provision of goods or services, or for the use of space or facilities. The income is not to be treated as donation income.
However, where, an individual waives personal fees earned outside the University for consultancy, or external lecturing and instead a sum is passed to the Department, this is classified as donation income.
Consultancy and trading contracts are dealt with either through subsidiary companies such as Cambridge Enterprise Limited established for this purpose or, if entered into by the University itself, using the trading accounts (GAAA sources of funds) for which see section 2 of the Chart of Accounts chapter of the Financial Procedures Manual. There are rules determining what trading activities charities are legally allowed to undertake: see section 24 of Financial Regulations.
Proceeds from the disposal of assets
Income received for the disposal of an item of equipment or another asset does not constitute a donation (unless it is the immediate disposal of a donated investment as envisaged in section Availability of Funds).