Distinguishing Between Gifts & Sponsored Awards

This procedure is intended to assist Principal Investigators (PIs) and department business personnel in determining how to process awards and where to deposit funds received by the department, especially in those cases when standard University procedures have not been followed.

Gifts and sponsored awards are made to the University in a variety of forms, reflecting the diversity of sponsors as well as their purposes.
The language used by a donor or sponsor in providing support is generally the source for making a distinction between a sponsored award and gift; however, sometimes the wording of the governing document makes it difficult to determine whether the document represents a sponsored award or gift.
If in doubt, contact Research and Sponsored Program Development (RSPD). RSPD, in consultation with Grants & Contracts Accounting (G&C), will make the final determination as to whether the funding in question shall be treated as a sponsored award or a gift.

Gifts

Support of the University that does not include the above conditions are viewed as a gift and may be managed within the recipient's department or unit.

A gift is any item of value given to the University by a donor who expects nothing significant of value in return, other than recognition and disposition of the gift in accordance with the donor's wishes.
Although a donor may place some restrictions on the use or disposition of a gift and may require a report that demonstrates the donor's wishes have been met, these terms do not make the gift a sponsored award. Such "restricted gifts" essentially create a fiduciary responsibility in which the University, by accepting the gift, is obligated to carry out the wishes of the donor.

How to Distinguish

The language used by a donor or sponsor is generally the source for making a distinction between a sponsored award and a gift. The resource tool below may assist with determining if a gift or sponsored award relationship exists.

Sponsored award instruments may include some or all the requirements and conditions.
Gifts may be unrestricted or may include some or all the restrictions.

This tool is not inclusive of every requirement or condition.

Requirement or Condition	Gift	Sponsored Award
General	Donor may restrict use or disposition.	Award instrument requires endorsement by a university official. Investigator is obligated to a line of scholarly or scientific inquiry that follows a plan, provides for orderly testing or evaluation, or seeks to meet stated performance goals.
Publication & Reporting	Donors may request copies of publications that result from research supported with donated funds and ask to be acknowledged in such publications. Donors may also request annual progress reports or a summary of the types of activities supported. Smaller gifts do not usually require reports.	The terms of the award require publications or technical reports dealing with substantive aspects of the work. Investigator is obligated to report project results.
Accounting & Financial Reports	Donor may require the funds be established in a separate account and an annual statement of total funds expended. Smaller gifts do not usually require accounting statements.	The award includes a line-item budget that identifies expenses by activity, function, or project period. Award includes budgetary constraints such as limits on budget categories, or the sponsor requires prior approval or other controls over expenditures. Fiscal accountability is required, as evidenced by submission of financial reports to the sponsor, an audit provision, or return of unexpended funds at the conclusion of the project.
Project Direction or Mentoring	A point of contact is identified, particularly if that person works in university relations or philanthropic functions of the corporation.	Sponsor identifies a technical monitor who is responsible for monitoring the performance, arranging research visits, and providing liaison between the University and corporate research teams.
Period of Performance	A period of performance is not normally included, but one may be stated as a general expectation.	Terms include a period of performance that is specific for defining allowability of expenditures or other purposes.
Renewal	Normally no formal renewal. Additional funding may be provided at the discretion of the donor.	May be renewed contingent on such things as technical review or satisfactory progress. (This implies the sponsor is monitoring perforamnce to determine some set of expectations are fulfilled.)