Defining Donation Type – Restricted or Unrestricted
Underlying the distinction between restricted and unrestricted donations is the concept of the general purposes of the University. The general purposes are teaching and research and, by extension, the provision of ancillary services such as the Bodleian Library, the museums and student support. Donations made available for the general purposes of a department, division or the University as a whole, are treated as unrestricted and taken directly to income. Unrestricted does not mean that a donation can be spent anywhere in the University, only that it is available for expenditure on general purposes.
Donations that are not for general purposes are restricted. A donation will be regarded as being restricted if:
- the donor sets out in writing the particular purpose for which the funds are to be used and this is more restricted than the funds being made available for the general purposes of the University; or
- the donation made is for a named member of staff or a sub-unit of a department as set out in writing by the donor; or
- the donation is, or is one element of a number of donations, made in response to a public appeal for donations to contribute towards a particular cause and there is documentary evidence that such a public appeal has been made.
Please note that where the donation has been made for a named member of staff, it will only be restricted if the donor has set out, in writing, the purpose on which the gift must be spent and this is more restricted than the funds being made available for the general purposes of the University.
Notwithstanding the above, a donation will be regarded as being unrestricted and credited to income if the donation falls below a de minimis level of £10,000, or can be spent within the financial year.
In order for a restricted donation to be set up as a project donation it must also meet a £25,000 minimum limit.
Where a donation is unrestricted, the process for accounting for deferred donations is not applicable because the full amount is recorded as income in the year in which it is received.