Graphs and Financial Updates

 


Endowment Fund Investment Overview
Endowment gifts for the benefit of Oklahoma State University are placed in the Pooled Investment Fund (PIF), which is managed by the OSU Foundation. The PIF is the Investment pool for both the endowed and non-endowed funds of the Foundation.

OK State Foundation Endowments

 

Endowment gifts for the benefit of Oklahoma State University are placed in the Pooled Investment Fund (PIF), which is managed by the OSU Foundation.  As of June 30, 2009, the OSU Foundation PIF consisted of 2,005, separate endowments.  During FY 2009, $18 million dollars in new endowment gifts were received.  The total market value at June 30, 2009, of the endowment accounts was $320.6 million dollars, which included the chair and professorship accounts established through the Pickens matching program.

The primary objective of the PIF is to generate an increasing stream of income to meet the rising costs of education, research and campus life while maintaining the purchasing power of its individual endowments over time.  The chart below represents the fair market value of the endowment for each fiscal year over a 10-year period.

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Investment Performance
The Pooled Investment Fund's performance is calculated on a total return basis, which measures the performance of equity, fixed income and alternative investments.

Total return, for purposes of this report, is the combination of income, dividends, gains and losses for the fiscal year net of investment management fees.  Investment performance is determined on the PIF as a whole rather than on each separate endowment.  Depending upon the timing of additions to an individual endowment, returns on specific endowments may vary from the following result.

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Asset Allocation
The Pooled Investment Fund incorporates a long-term view of the financial markets to determine the appropriate asset allocation guidelines.

This asset allocation is intended to provide funds for both spending distribution and for appreciation potential with an acceptable level of related risk.  The Investment Committee of the Board of Trustees reviews portfolio composition at least quarterly; and, if deemed necessary, it will direct cash flow or assets to be shifted to bring the portfolio within the target ranges.

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Portfolio Composition
The Investment Committee reviews portfolio composition at least quarterly; and if, deemed necessary, it will direct cash flow or assets to be shifted to bring the portfolio within the target ranges.

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Spending Policy
A goal of the Pooled Investment Fund is to achieve investment performance that supports stable endowment spending from year to year in order to provide steady predictable funding for programs.

The Board of Trustees-approved spending amount is calculated as the prior year's spending amount adjusted by inflation.  The adjustment for inflation is made by dividing the Consumer Price Index (CPI) as of November of the current year by the CPI of November of the previous year.  The calculated spending amount is adjusted for new gifts or reinvested cash by adding an amount equal to 5% of new gifts or reinvested cash received by December 31.  The spending policy is reviewed by the Investment Committee at least annually. 

 

The committee can and has made annual adjustments to the formula to increase the distribution when exceptional investment performance is achieved.  Unless specific donor permission is obtained, no spending is authorized for any endowment account for which the market value as of December 31 of the current year is less than the historic gift value.

The following graph represents the funds available to the university from the Pooled Investment Fund's spending distribution for the eight-year period FY02-FY09.

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Endowment Program Support

The Pooled Investment Fund supports university programs as designated by the donors.  Programs supported by the spending policy distributions including scholarships, fellowships, professorships, chairs, building operations and research activities.

Many important university activities could not be achieved without the financial support from endowment funds.  OSU is fortunate to have endowments that support programs system-wide.

 

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OKLAHOMA STATE UNIVERSITY FOUNDATION
400 South Monroe / P.O. Box 1749 / Stillwater, OK 74076-1749
Ph. 800.622.4678 / Fax 405.385.5102 / info@OSUgiving.com
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