Each year we try to provide some guidance about projecting the upcoming year endowment payout. To that end, as a general rule for FY11 planning purposes, estimate 95% of the FY09 spendable payout/distribution amount for each endowment.
Endowment payout for both the UM Foundation and UM Treasury Accounting endowments is calculated by multiplying 4.5% by the average past 20 qtr endowment value. For units with many endowments, this is a time intensive task. Thus, the rule above will provide a reasonable payout projection. However, consideration should be paid to individual endowments with a lot of activity (including but not limited to large new gifts or disbursements) or that were recently created (during and since FY08).
Some background information: As a whole, endowment values decreased nearly 30% during FY08 and FY09 depending on the particular endowment. Endowment values gained during FY04-07 an average of 10% each year. Values have experienced modest increases during the first two quarters of FY10.
If you have further questions about endowment projections, contact your senior accountant on your financial service team.
On Monday, March 1, 2010 you may begin entering Fall/Spring 2010-2011 scholarship awards in PeopleSoft. March 5, 2010 is the deadline for all incoming new freshman scholarships to be entered in order to be included on the Estimated Financial Aid Award Notice (EFAAN) for Fall/Spring 2010-2011.
NOTE: The Office of Student Finance sends estimated financial aid award packages to all incoming freshmen in March so that they are better able to make a decision on what school they choose to attend. Any scholarship award that is not included in this estimated package could have a negative impact on their decision to attend the U of M because they would have an incomplete financial picture. Therefore, Student Finance asks that all departments do their best to have freshmen scholarships entered by March 5. Many colleges/departments work with Admissions to award these freshmen students. The remaining scholarships for continuing students need to be entered before July 1st so that they are included in the actual financial aid packages that are created and sent out in early July.
