What is a recapitalization?

To recapitalize funds in an endowment fund is to take excess endowment fund income and transfer that balance to the capital account.

This means that the funds will be reinvested in the Endowment Fund for perpetuity and cannot be spent. Additional units will be purchased and investment income will be earned on the additional capital each year going forward. Recapitalization can only be done if there is excess income.

Recapitalization of excess endowment fund income

If you wish to transfer unspent endowment income into an endowment capital account (recapitalize), please submit your request to financial.reporting@queensu.ca.   For these types of recapitalizations the person with signing authority over the endowment fund should have approved the recapitalization request and be copied on the email. 

To process your request we require you provide the fund and the associated department for which the recapitalization is to be completed, the amount of excess income you wish to recapitalize, and confirmation that the amount requested is not greater than total excess available within the fund.

Transfer for the purpose of capitalization (endowing internal/expendable funds)

Fund holders occasionally request the transfer of amounts from a trust fund or an operating program into an Endowment fund for the purposes of capitalization. Provost approval is required for any transfers to endowment capital that are not straight recapitalizations of excess endowment fund income. The capitalization approval form, found within the forms tab on the Financial Services website, must be completed for any such requests and forwarded to Financial Services (with the required attachments). It can be sent electronically to financial.reporting@queensu.ca 

Timing

The opportunity to recapitalize/transfer is offered once per year.  Financial Services will accept requests starting in March up to the submission deadline in April. Financial Services requires time to review and process the recapitalization requests and transfer the funds to the Pooled Endowment Fund before the fiscal year ends.

For Fiscal 2013, Financial Services will accept requests starting March 15th, 2013 and the deadline for submissions is April 12th, 2013.

Contact

Phone: 613-533-2050

Email: finanicial.reporting@queensu.ca

 

Kind Regards,

Queen's Financial Services