Glossary
The MCV Foundation provides this glossary to help you better understand
key terms.
Endowment: an amount invested
to produce a return through dividends, interest and capital appreciation.
Also known as endowment corpus or endowment principal.
Endowment Investment Pool: a
portfolio of investments owned by all participating endowment funds, similar
in operation to a mutual fund. Contributions and other additions to principal
"buy" shares in the investment pool based on the most current
market "price" per share. The market price is calculated monthly.
Endowment Fund Balance: the sum of all contributions
and additions to principal of the fund since inception. Also known as
principal cost or historical cost of the endowment.
Endowment Market Value: the
number of shares owned by an endowment fund multiplied by the most recent
market price of a share. Market value refers only to the principal and
does not include any amount for income.
Available Income Balance:
the running total of all earnings minus all expenditures. At the end of
the fiscal year, this should be $0.00
Payout: the amount generated each year by an endowment in the investment
pool. Payout is calculated at 5% of the three year average market value
of a share in the investment pool. The dollar amount for the fiscal year
is credited to individual income accounts as of July 1.
Reinvestment: dollars removed
from the available income balance and added to the endowment fund balance.
Amounts reinvested purchase more shares in the investment pool to produce
additional payout. Reinvested amounts become a permanent part of the endowment
principal and may not be spent in subsequent years.
Return to Especially for MCV Campus Fiscal
Officers
Top of Page
Home
|
