Stock Gift Entry

Hi everybody,

My organization is in the process of converting to Tessitura from Raiser's Edge, and I'm very glad to have found this discussion, since I need to solve this problem. I like the custom constituent screen as a short-term workaround, but would love to see this addressed in a future version.

I agree with Amber that it's important for the future Stock functionality to handle all four of her scenarios (1 stock gift to one pledge, 1 stock gift to multiple pledges, multiple stock gifts to 1 pledge, and multiple stock gifts to multiple pledges.)

It's also important to be able to handle the issue raised by Tony about accounting for gain/loss and fees with respect to paying pledges. The stock handling functionality needs to create GL transactions for the value of the asset itself, the gain and loss, and the fees. Since stock is not always sold, there should be a way to indicate whether the asset was sold or not. For cases where it was sold (especially if it was sold immediately by the broker as a standard business rule) the system would generate three sets of GL transactions: that would create sufficient flexibility to accommodate most organizations' business practices.  The amount applied to the pledge balance would be the actual asset value (since that's accurate from the donor's perspective and in terms of enforceable pledges). The gain/loss and expenses transactions could be set up for whatever GL accounts are appropriate for the organization. Here's what it would look like:

In cases where the business rule is that stock is immediately sold by the broker upon receipt, FASB rules allow the GL to simply reflect the net proceeds, so some organizations don't have or use Gain/Loss and Expense accounts. For those organizations, the Gain/Loss Account and the Expense account can simply be set to be the same as the Income account for the fund. That way the Pledge gets paid off with the correct amount, there's no discrepancy between Finance and Development on the outstanding pledge amount, but Finance isn't maintaining extra GL Funds. There will be a discrepancy between the total income for the Fund between the two systems, but it can be accounted for with the Gain/Loss and Expense amounts.

Since we're still in the throes of conversion, I don't yet know enough about the backend Tessitura structure to make recommendations on actual implementation. But I'm happy to help in any way I can.

Thanks!

-Galen

Hi everybody,

My organization is in the process of converting to Tessitura from Raiser's Edge, and I'm very glad to have found this discussion, since I need to solve this problem. I like the custom constituent screen as a short-term workaround, but would love to see this addressed in a future version.

I agree with Amber that it's important for the future Stock functionality to handle all four of her scenarios (1 stock gift to one pledge, 1 stock gift to multiple pledges, multiple stock gifts to 1 pledge, and multiple stock gifts to multiple pledges.)

It's also important to be able to handle the issue raised by Tony about accounting for gain/loss and fees with respect to paying pledges. The stock handling functionality needs to create GL transactions for the value of the asset itself, the gain and loss, and the fees. Since stock is not always sold, there should be a way to indicate whether the asset was sold or not. For cases where it was sold (especially if it was sold immediately by the broker as a standard business rule) the system would generate three sets of GL transactions: that would create sufficient flexibility to accommodate most organizations' business practices.  The amount applied to the pledge balance would be the actual asset value (since that's accurate from the donor's perspective and in terms of enforceable pledges). The gain/loss and expenses transactions could be set up for whatever GL accounts are appropriate for the organization. Here's what it would look like:

In cases where the business rule is that stock is immediately sold by the broker upon receipt, FASB rules allow the GL to simply reflect the net proceeds, so some organizations don't have or use Gain/Loss and Expense accounts. For those organizations, the Gain/Loss Account and the Expense account can simply be set to be the same as the Income account for the fund. That way the Pledge gets paid off with the correct amount, there's no discrepancy between Finance and Development on the outstanding pledge amount, but Finance isn't maintaining extra GL Funds. There will be a discrepancy between the total income for the Fund between the two systems, but it can be accounted for with the Gain/Loss and Expense amounts.

Since we're still in the throes of conversion, I don't yet know enough about the backend Tessitura structure to make recommendations on actual implementation. But I'm happy to help in any way I can.

Thanks!

-Galen

Galen,

One other resource you might have a look at are the conference archives.  You'll find presentations from 2006 through 2012 in there and I know there is at least one presentation on stock gifts because I did one back in 2008.  You can download that one here.

Some of these are peer to peer presentations and others are training by the Tessitura staff.

Dale