presented by sean fleming, cus president
DESCRIPTION
Commerce Undergraduate Society Endowment. Presented by Sean Fleming, CUS President. Sources of the Surplus. $441,644 in Operating Surplus on May 1 st , 2013. Where we are now. 1999 Fee Increase. Conservative Budgeting. Increase in BCom Enrollment. Causes. Sources of the Surplus. - PowerPoint PPT PresentationTRANSCRIPT
Presented by Sean Fleming, CUS President
Commerce Undergraduate SocietyEndowment
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Sources of the Surplus
Where we are now
Causes 1999 Fee Increase Conservative Budgeting
Increase in BCom Enrollment
$441,644 in Operating Surplus on May 1st, 2013
Sources of the Surplus
3
Where weare now
Causes 1999 Fee Increase Conservative Budgeting
ChangesLowered Fees to
$245
Increase in BCom Enrollment
Introduced Better Financial Controls
$441,644 in Operating Surplus on May 1st, 2013
Where we can be Create sustainable, cost-efficient value for students
Invest portion of Accumulated
Surplus
Sources of the Surplus
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Where weare now
1999 Fee Increase Conservative Budgeting
ChangesLowered Fees to
$245
Increase in BCom Enrollment
Introduced Better Financial Controls
$441,644 in Operating Surplus on May 1st, 2013
Where we can be Create sustainable, cost-efficient value for students
Invest portion of Accumulated
Surplus
5
February Council Meeting
Is this the best way to invest the money?
Is this what students want?
Does the contract protect students?
Previous:IMANT Endowment
$250,000$50,000 over 5 yearsOld Contract
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Since February Council Meeting
Is this the best way to invest the money
Is this what students want?
Does the contract protect students?
Investment Criteria
Return on Investment
Does this benefit past, current or future students?
Which students benefit?Inter-generational
Benefit
Fit with Organization
Does this fit the CUS’s abilities and goals?Want to make sure this investment can be successfully implemented and overseen by future groups of leaders
Measured in monetary or monetary equivalent terms, adjusted for length of investment
Which channel provides the most value?
Legal Protection
Is the value adequately protected?There are legal, operational and uncertainty risks with any investment and these need to be evaluated
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Investment Options
IMANT Endowment
Principal – Very LowPayments - Medium
3.5%
1AMS Endowment
Medium
.87%
2CSC Down Payment
None after Payment
-.41%
3
Real Return
UBC IMANT provides the best tradeoff of risk and return
Flexibility
Low Low/Medium MediumRisk
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Investment Options
IMANT Endowment
Principal – Very LowPayments - Medium
3.5%
1AMS Endowment
Medium
.87%
2CSC Down Payment
None after Payment
-.41%
3
Real Return
UBC IMANT provides the best tradeoff of risk and return
Flexibility
Low Low/Medium MediumRisk
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UBC Investment Management Trust
3.5% return, $10,500/year in spending
Long term value for students
Strong legal protections for students
IMANT Endowment
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Since February Council Meeting
Is this the best way to invest the money
Is this what students want?
Does the contract protect students?
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Referendum Results
YES85%
NO15%
“I authorize the Commerce Undergraduate Society’s Board of Directors to approve a transfer of $300,000 from its accumulated operating surplus to an endowment to be administered by the University of British Columbia’s Investment Management Trust, with the annual returns from this investment to be used for projects and activities benefiting Bachelor of Commerce students.”
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Since February Council Meeting
Is this the best way to invest the money
Is this what students want?
Does the contract protect students?
14
Changes to Contract
Review by External Legal Counsel – Michael Blatchford; Bull, Houser, and Tupper
Any changes must support the purposes (Benefits to BCom students)Article 6/7
Schedule A More clarity about how the money is disbursed and spent
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Investment Options
IMANT Endowment
Principal – Very LowPayments - Medium
3.5%
1AMS Endowment
Medium
.87%
2CSC Down Payment
None after Payment
-.41%
3
Real Return
UBC IMANT provides the best tradeoff of risk and return
Flexibility
Low Low/Medium MediumRisk
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Encroachment HistoryDate Reason
19-Nov-13 Money being taken from faculty's own endowment(s) to create a new professorship.17-Sep-13 Name change for the endowment as requested by the donor.04-Jun-13 Name change for the endowment as requested by the donor.04-Apr-13 Transfering to a new fund as the old fund supported a purpose that no longer exists due to the disolution of a previous Institute.
Exemption from amortization payments.Name changes (x2) for endowments as requested by donors.Expand the purpose of the fund due to an abundance of money in its spending account, as consented to by the family of the donor.Limit the purpose of the fund due to unsufficient resources in it, as requested by the donor's family.Exemption from amortization payments.Name change to reflect a change in the name of the donor organization.Transfer of funds to another endowment due to their being insufficient to support the purpose, as consented to by all of the original donors who could be contacted.Name changes (x2) for endowments as requested by donors.
12-Jun-12 Merging funds and other administrative changes as requested / consented to by the donors.Update terms of reference to reflect changes in the structure of UBC's programs for community service; no next-of-kin.
06-Feb-13
04-Dec-12
20-Sep-12
03-Apr-12 Exemption from amortization payments.Name change to reflect the acquisition of the original corporate donor by another company.Collapsing the funds and transferring them to other funds or annual awards, as consented to by the donor.Exemption from amortization payments.Name changes (x8) for endowments as requested by the faculty to reflect a change of name for the faculty itself.Name changes (x2) as requested by corporate-donors.Broadening the scope of elibigility as consented to by the donor.Transferred to an awards account in order to reflect the lack of funds remaining, as requested by the donors.Exemption from amortization payments.
08-Jun-11 Transferred to an awards account in order to reflect the lack of funds remaining, as requested by the donors.Name changes (x3) as requested by donors.Changes to the purpose as requested by the donor.
07-Feb-11 Name change as requested by the donor's family.23-Nov-10 Changing from a prize to a scholarship, with the consent of the donor.16-Sep-10 Collapsing the fund and transferring it to another one with a similar purpose, as requested by the faculty that crated the fund.08-Apr-10 Changing the payout term as consented to by the donor.04-Feb-10 Broadening of the purposes as consented to by the donor.
05-Apr-11
02-Feb-12
27-Sep-11
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Appendices
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AMS Endowment
.87% return (5 year average), $2,610/year
Flexibility if new projects emerge
Exposed to all the same risks as the CUS
AMS Endowment
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Investment Returns
NPV EANB
IMANT $ 155,497 $ 6,194
AMS $ 30,704 $ 1,223
CSC -$ 30,274 -$ 1,206
Status Quo -$ 188,271 -$ 7,500
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AMS Investment Returns
Average Performance5 year 10 year 15 year
Annual Interest Income $ 292,986
$ 273,799
$ 255,016
Average Performance5 year 10 year 15 year
Effective Annual Return 2.33% 2.86% 3.33%Annual Inflation 1.47% 1.78% 1.99%Real Return 0.87% 1.08% 1.34%
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The actual return was 2.53%, 27% lower than stated
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