Types of donation for accounting purposes

Topics covered in this section are:

• Sources of funds for donations
• General Donations - source of funds EF** to EX**
• Specific Donations - source of funds H***
• Specific Endowments

Sources of funds for donations

Donations are credited to a source of funds code in the ranges indicated in the below table and with an appropriate transaction code beginning LF**. The decision tree at Appendix A should be referred to for further guidance. If in doubt, Departments should contact the GL codes helpdesk in the Finance Division: GL Helpdesk on UFS_GL_@admin.cam.ac.uk.

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General Donations - source of funds EF** to EX**

A General Donation is one in respect of which the donor has either:

• not placed any restrictions; or
• has placed restrictions which are met by expenditure already committed or planned as part of the department's existing operations.

Note that it is the donor's instructions which determine the status, not the separate decision which might be made by a department as to how the donation will be used.

It is advisable for general donations to be posted to either one source of funds e.g.. EFKM, or to a small number of sources of funds codes in the range. They can then be sub-divided using cost centres if required. Setting up a new source of funds for each general donation is unnecessary and should be discussed with your Finance Adviser.

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Specific Donations - source of funds H***

A specific donation is one in respect of which the donor has specified restrictions or conditions limiting the way in which the funds can be spent. For accounting purposes, however, donations are still not treated as specific, where the restrictions or conditions can be met by expenditure already committed or planned as part of the department's existing operations.

Note, again it is the donor's instructions which determine the status, not the separate decision which might be made by a department as to how the donation will be used.

Some specific donations will be used for capital expenditure on buildings or equipment. These will be treated as capital grants in the University's accounts, and any required accounting adjustments will be made by the Finance Division.

Note that the funds created by specific donations are dealt with in the University's financial statements under the heading of "endowments" in accordance with the requirements of the 2019 Statement of Recommended Practice (SORP). The distinction between these and the funds dealt with in the next paragraph remains important for internal purposes.

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Specific Endowments

A specific endowment is a donation where the donor has specified that the funds are to be invested and the investment income is to be used for specific purposes, which may be as wide as a department or academic area. The funds may be required to be invested in perpetuity or for a finite period. Specific endowments are of two types.

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