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Measures for Receiving, Managing, and Use of Donations by NYU Shanghai Education Development Foundation
Chapter I: General Provisions
Article I. The Measures for Receiving, Managing, and Use of Donations by NYU Shanghai Education Development Foundation (hereafter referred to as “the Measures”) have been formulated by the NYU Shanghai Education Development Foundation in order to gain widespread support from the community to promote educational development and public welfare, and are based on Chinese laws including the “the Law of the People's Republic of China on Donations for Public Welfare”, “Regulations on Administration of Foundations”, “Several Provisions on Regulating Behavior of Foundations (for Trial Implementation)”, and the “NYU Shanghai Education Development Foundation Articles of Association”.
Article II. The Measures apply to all donations to the NYU Shanghai Education Development Foundation (hereafter referred to as “the Foundation”).
Article III. The term “donation” refers to all forms of donations to the Foundation, including currency, gifts in kind, bonds, stocks, intellectual property, etc.
Article IV. The Foundation is by nature a private foundation, whose major source of revenue comes from:
(1) Voluntary donations from natural persons, legal persons or other organizations;
(2) Income from activities or services within the provisions of the approved scope of business;
(3) Gain from investment;
(4) Other legitimate sources of income.
Article V. According to the nature of the Foundation’s funding, donation gains shall mainly be utilized for the following purposes:
(1) To support education, research and other teaching activities;
(2) To reward excellent teachers and students;
(3) To aid students in poverty;
(4) To support and promote academic exchange and cooperation;
(5) To support campus construction;
(6) To support other programs that align with the Foundation’s mission;
(7) To carry out the Foundation’s daily operations.
Chapter II: Giving Principles
Article VI. Equal and voluntary. Donations should be based on mutual agreement and be given on a completely voluntary basis.
Article VII. Donations and conflict of interest. The two parties involved in the donation process shall not exchange favors in the name of charitable donation.
Article VIII. Respect for the donor’s intent. The use of the donation shall not be modified without gaining the donor’s permission.
Article IX. Openness and transparency. The Foundation should report to donors on the use of donations on a regular basis. The Foundation shall be proactive about seeking public oversight.
Chapter 3: Donation Receiving Process
Article X. The Foundation offers four donation channels to donors from all areas of society:
(1) Chinese domestic bank transfer or international wire transfer;
(2) Checks: made payable to “NYU Shanghai Education Development Foundation”;
(3) Online donation: donor can give through the third–party payment platform on the Foundation’s website, for more details, see “Nature of Online Donations by NYU Shanghai Education Development Foundation”; or
(4) Cash Donation.
Article XI. Signing a gift agreement or recording a donation. The donor and recipient shall sign a gift agreement drafted through friendly consultation on the basis of equality, or, if during negotiations both parties agree not to sign a gift agreement, they should record the receipt of the gift (in the form of an email confirmation or online record).
The gift agreement regulates amount, purpose, payment method, payment schedule, and other aspects of the gift. Adjustments may be made for specific details or to meet different donor needs. Terms which are incompatible with the Foundation’s charitable purposes or which provide benefits to donors in return may not be added to the gift agreement. In general, the gift agreement shall be presented in a bilingual format (Chinese and English), signed by both parties, and stamped with the Foundation’s official chop. Two copies of the agreement shall be made to be kept on file by both parties.
The signatory representative of the NYU Shanghai Education Development Foundation is its legal representative. Under the legal representative’s legal authorization the Secretary-General of the Foundation and the Vice Chairman of the Foundation may also sign gift agreements on behalf of the Foundation. If the Foundation’s signatory must be changed, the decision shall be made by the Foundation’s Board of Directors. If the gift agreement refers to a specific beneficiary, 5
beneficiary organization and purpose, under ordinary circumstances, the beneficiary or the beneficiary’s representative shall also sign the gift agreement.
Only the donor – the legal person making the donation or the person with legal authorization to sign on behalf of the donor – may sign the gift agreement on behalf of the donor party. The title on the voucher for public welfare donations for an individual donor is the individual donor’s full name, while the title for a corporate entity is the corporate entity’s name and the gift agreement shall be affixed with the corporate entity’s official seal.
Article XII. The Foundation shall communicate to ensure that the donor delivers the (in-kind) gift on time according to the payment schedule and payment method on gift agreement or registration form/email.
For cash gifts, the Foundation’s Finance Office should properly keep the cash gifts and deposit it into the Foundation’s bank account in time.
The donor should ensure that the gift is of legitimate source, with no defects of right. The donor should have full right of disposal.
Article XIII. The Foundation shall issue a “ Unified Invoice of Donation for Public Welfare” (hereafter referred to as “donation voucher”) to the donor with the title of the individual’s name or the name of the corporate entity showing on the gift agreement/registration form, regardless of the amount of the gift.
The NYU Shanghai Education Development Foundation is listed as a social organization for public welfare, which has obtained permission to give donors pre-tax deductions for charitable donations, through the joint audit of the Municipal Tax Bureau, the Municipal Finance Bureau, and the Municipal Civil Affairs Bureau (沪国税所〔2014〕26号). Donors may file for personal or enterprise income tax deductions according to “the Notice on Issues Concerning the Pre-tax Deduction of Public Welfare Donations” (财税【2008】160号) and relevant laws and regulations, given the donation voucher issued by the Foundation. Tax operation may involve privacy issues, therefore the Foundation suggests donors ask their human resource personnel or regional tax authorities for consultation.
The Foundation manages donation vouchers according to its “Procedure for the Internal Management of Vouchers for Public Welfare Donations”.
Article XIV. Gifts-In-Kind: the List of Gifts-In-Kind signed/sealed by the donor (including the item name, amount, unit price, model, and other relevant information), receipts or other documents that verify the value of the gift-in-kind should be attached to the gift agreement, and saved and filed by the Foundation. When determining the value of the in-kind gifts categorized as art works and other cultural artifacts, their market value shall be entered into the account with the value agreed by both parties without violating the law.
When the in-kind gift arrives at the Foundation, the Foundation shall sign the “Proof of Receiving Gift-in-Kind” to confirm receipt of the gift. Then, the gift in-kind shall be entered into the Foundation’s records and officially filed. The Foundation shall issue a donation voucher according to the signed “Proof of Receiving Gift-in-Kind”, gift agreement, and the attached List of Gifts-in-kind.
In order to make the process of filing the proof of donation more conveniently for donors, the Foundation will sign two copies of the “Proof of Receiving Gift in Kind”, one will be filed and saved at the Foundation’s Finance Office, the other one will be given to the donor together with the donation voucher.
During the transfer of gifts in kind from the Foundation to the beneficiary, the beneficiary shall sign a “Proof of Transferring Gifts-in-Kind” which clearly shows the details of the gift(s)-in-kind, including name, category, quantity, quality, purpose. If transfer of ownership procedures apply to the gifts in kind, then such procedures shall be conducted.
For specific provisions of Gift-in-kind, refer to “Measures on Managing Gifts-in-Kind”.
Article XV. Cross-border Donation: cross-border donation refers to those (in-kind) gifts coming from outside Mainland China. Cross-border donations only differ from donations from within Mainland China in terms of donation channels, all workflow for processing the cross-border donations shall remain consistent with the process described above. The Foundation shall communicate with the donor about cross-border gifts in-kind in advance to help facilitate customs and other necessary formalities.
According to the “Guidelines for Reporting on Important Matters of Social Organizations in Shanghai” established by Shanghai Civil Affairs Bureau and Shanghai Administration Bureau of NGOs, upon receiving cross-border donations, Foundations should report to Shanghai Administration Bureau of NGOs. The report should include donation amount, donor information (for non-anonymous donations), purpose, country, and etc. Please note that a gift agreement and a registration form containing information about the individual or legal entity must be drafted and signed for all cross-border donations. The name on the gift agreement/registration form should be the same as the remitter name (for specific requirements see Article XII).
Article XVI. The Foundation shall operate under the principle of independent accounting, establish and prepare accounts, and only use funds for their designated purpose, disclose to the donors and the public the Foundation’s operations, announce the use of all gifts according to the “NYU Shanghai Education Development Foundation Articles of Association”.
Article XVII. Donations entered into the Foundation are also under the supervision and management of New York University’s global gift administration system. The use of the global gift administration system and scientific management 10
process ensures that the use and management of donations are effective, legitimate and transparent.
Chapter IV: Recognition for Donations
Article XVIII. Regardless of the amount of the donation, giving information may be publicized under suitable circumstances in suitable ways with the donor’s consent except for anonymous donations and with the exception that any laws may apply.
Article XIX. Regardless of the amount of the donation, the Foundation shall thank the donor. Methods of expressing gratitude include sending a thank you letter or certificate, or hosting an event to thank donors.
Article XX. For some donations, the Foundation may express its appreciation and acknowledge the donor by coordinating with the beneficiary organization to offer naming opportunities for buildings, laboratories, financial aid and scholarship, professorship, and etc.
Article XXI. If donors violate national laws, regulations, or behave in a manner which negatively impacts society, the Foundation reserves the right to withdraw its thanks.
Article XXII. For any outstanding issues, specific methods of expressing appreciation shall be worked out based on the circumstances of the specific donation.
Chapter V: Use of Donations
Article XXIII. Donations can be categorized as follows:
1. Based on the donor’s giving preference, the donation can be either restricted or unrestricted.
A restricted fund is a fund provided by a donor with specific purpose to support a program, an area, or an organization.
An unrestricted fund is a fund with no specific giving preference in its purpose and beneficiary, and may be utilized by the Foundation to support areas, beneficiaries, and programs which are most in need of funding according to its mission.
2. By nature, Funds may either be designated as an endowment fund or an expendable fund. Both restricted and unrestricted funds may be endowed or expendable.
For an Endowment fund, the principal must be maintained for investment only. Only the interests or investment returns may be used in part or in whole to support relevant programs.
An Expendable fund may be used directly to pay for program-related expenses, until all funds are expended.
Article XXIV. After the donation enters the Foundation’s account, it will be managed and used according to the gift agreement. According to the “Regulations on Administration of Foundations”, private foundations may not spend less than 8% of their year-end fund balance to support public welfare programs regulated by their Articles of Associations. The NYU Shanghai Education Development Foundation will abide by this benchmark.
Article XXV. The Foundation Secretary-General along with Finance Office shall prepare an annual budget plan for the next year, including programed revenue from donations, a plan for endowment funds, and the use of expendable fund, etc. After the budget is submitted to the Foundation Board and approved, it will be implemented and supervised by the Foundation Secretary-General’s Office.
Article XXVI. The Foundation shall use unrestricted fund based on real circumstances and all other relevant aspects, including but not limited to aspects mentioned in Article V.
Article XXVII. For restricted donations, the Foundation shall communicate the specific requirements to the designated beneficiary, and request a program plan as well as program budget from the beneficiary. The Foundation shall review the feasibility of the plan and budget based on a comprehensive consideration of the Foundation’s mission and Articles of Association, content of the gift agreement, and projected cash flow.
Article XXVIII. Representatives of the Foundation and the relevant department of beneficiary organization shall implement programs in accordance to program plans and budgets. Upon approval of the Foundation’s Board or Secretary-General, representatives or legal signatories from both parties shall sign the “NYU Shanghai Education Development Foundation Program Funding Request Form” (hereinafter referred to as “the Funding Request Form”. The gift agreement, program plan and program budget shall be attached to this form and kept on file by the Foundation.
Program proposals and/or budgets which are not approved shall be returned to the beneficiary organization for adjustment and re-submission for the Foundation’s approval.
Article XXIX. Signing of the Funding Request Form by both parties ensures the Foundation and Beneficiary reaches agreement on what’s on the Funding Request Form and attached program plan and budget. The finance office of the beneficiary organization should collect the original receipts for all program-related expenses to keep on file following reimbursement, and provide the Foundation with soft copies of the original receipts.
Article XXX. Fund transfer from the Foundation to the beneficiary organization requires the signing of “Program Funding Agreement”, which regulates amount and method of funding the project.
The approval and signing of the “Funding Agreement” shall refer to the provisions as following: if the amount to be disbursed in one payment is less than RMB 500,000 (or equivalent) on one program, the payment must be approved by the Foundation Secretary-General or Vice Chairman. If the total amount of the disbursement in one payment exceeds RMB 500,000 (or equivalent), it must obtain approval from the Foundation’s Board.
The Foundation will transfer the funding according to the Program Funding Agreement.
Article XXXI. After the program settlement completed, the Foundation will file each program separately, documents kept on file shall include relevant documents such as the Funding Agreement, Program Summary Report, Program Expense Report, hard copies of original receipts for program-related expenses, Program Funding Request Form, bank transfer vouchers, etc.
Article XXXII. If the beneficiary organization needs to modify the original program plan, it should submit an adjusted program proposal to the Foundation in advance of the change. The program may only be implemented following the Foundation’s approval of the change.
Article XXXIII. As program develops, the beneficiary organization shall periodically update the Foundation about the program’s progress. The Foundation will communicate program progress and the use of the gift to corresponding donors in a timely manner.
The beneficiary organization should provide documentation on project results, examples of possible documentation include photographs, videos, list of attendees, research findings, etc. The results and cost of the program shall be filed at the Foundation and the information shall be made open to the public to a certain extent, with considerations for government regulations and donor’s willingness.
Article XXXIV. If the beneficiary organization violates the terms in the gift agreement and/or funding request form, or does not use the funds in accordance with committed purpose, the Foundation has the right to take actions including refusal to disburse funds or withdrawal of funding.
Article XXXV. During implementation, funded programs shall acknowledge the support of the Foundation and donor as appropriate (e.g. display of the Foundation logo, or a message of thanks) depending on different situations.
Article XXXVI. Significant public welfare spending: according to Term 1, Article 34 of the NYU Shanghai Education Development Foundation Articles of Association, significant spending and investment are defined as following: 1) Program obtaining Foundation funding of over RMB 500,000 in one transfer; 2) A single transaction requiring financial investment of over RMB 1 million.
According to “Guidelines for Reporting on Important Matters of Social Organizations in Shanghai” drafted by the Shanghai Civil Affairs Bureau and the Shanghai Administration Bureau of NGOs, significant public welfare spending (program that obtained Foundation funding of over RMB 500,000 in one transfer) must be reported to Shanghai Civil Affairs Bureau. The report should include amounts for spending on public welfare, purposes of public welfare spending, and other relevant information.
Article XXXVII. The Foundation shall undergo an annual audit by the Shanghai Administration Bureau of NGOs each year. The result of the annual audit shall be posted on the China NPO Website, and the summary will be published on the “Chinese Society Newspaper” or other accredited newspaper or media. In addition, the Foundation will publish its annual report on its official website.
Chapter VI: Fund Management
Article XXXVIII. According to “Articles of Association of NYU Shanghai Education Development Foundation”, the Foundation shall keep and manage its assets under the following principles: legal, secure, profitable, and effective. The Foundation shall ensure the security of the principal, while maximizing overall return on investment to meet the donors’ requirements.
Article XXXIX. The Foundation shall manage the investment of its endowment fund and unplanned expendable funds according to the stipulations of the gift agreements. Investment decisions shall give comprehensive consideration to all factors including fund liquidity, security, and profitability.
Article XL. Initially, the Foundation will have limited funding capacity, therefore investments will mainly be focused on relatively mature investment products in the financial market, mainly financial products from banks in order to preserve the Foundation’s principal funds.
Article XLI. When the Foundation has matured and scaled up its fund capacity, it will begin to explore investing in tailored financial investment products provided by banks and other financial organizations. In order to better meet the expectations of donors, the Foundation shall invest a small portion of its principal in a proactive manner in order to gain higher overall returns on investment while concurrently pursuing low risk and stable returns.
Article XLII. When financial products expire, the Foundation shall continue to invest in similar or more lucrative financial products while making adjustments based on cash flow projections to ensure the efficient utilization and management of funds.
Article XLIII. Detailed processes for the approval and review of investment activities shall refer to the following: in summary, if the total funds disbursed for a single program amount to less than RMB 1,000,000 (or equivalent) in one payment, the disbursal must be approved by the Foundation’s Secretary-General or Vice
Chairman and reviewed by Finance Office. If the total disbursement amount in one payment exceeds RMB 1,000,000 (or equivalent), the disbursement must be approved by the Foundation’s Board.
Article XLIV. Based on the donor’s wishes, the Foundation shall disclose investment information on its endowment funds as appropriate.
Chapter VII: Additional Provisions
Article XLV. These measures are written in both the Chinese and English languages. In the event of a conflict between the two versions, the Chinese version will control.
Article XLVI. These Articles shall be interpreted by the Foundation Secretary’s Office.
Article XLVII. These Articles shall come into effect upon approval by the Foundation’s Board of Directors.