2011-02-09T14:54:26-06:00 2010-06-30 Ernst & Young US LLP 111 Monument Circle Suite 2600 Indianapolis IN 46204 990 2009-07-01 480547734 The Kansas University Endowment Association KANS 7858327400 PO Box 928 Lawrence KS 660440928 Jeffrey W Davis 7858327400 2011-02-09 1 3176817000 2009 2016-02-24 21:20:13Z KU Endowment Dale Seuferling PO Box 928 Lawrence KS 660440928 207965217 0 X www.kuendowment.org X 1891 KS University Support 9 7 273 68 25844 0 102470771 107274043 2134157 1919836 32777551 10912631 9812451 12216919 147194930 132323429 29790663 29480010 0 29896454 31953611 320247 246081 8719959 64140397 66221705 124147761 127901407 23047169 4422022 1198110772 1311662594 155656556 147800769 1042454216 1163861825 To build a greater university than the state alone can build, it is the mission of KU Endowment to solicit, receive and administer gifts and bequests for the support and advancement of the University of Kansas. 0 0 28862820 28862820 Student Support--virtually all scholarships, awards and fellowships awarded by KU come from private contributions to KU Endowment. Private donations during the year created 54 new scholarship funds, and five new student award funds. Approximately 6,500 students received scholarships this year. 24031835 617190 Faculty Support increased by 6 percent over the previous year. In addition to faculty development and awards, support by donors through KU Endowment provided more than 88 percent of total funding for KU's distinguished professors, including 173 professors who hold named endowed positions. This support is invaluable in creating the vibrant teaching and research environment that one expects at an international research university. 39791531 2482824 Program and Educational support increased by 26 percent from the previous year. Support from private donors strengthens academic programs and brings renowned scholars, artists and performers to KU. It also expands the holdings of KU's libraries and museums. 16756924 223910 Facilities Support--construction, equipment, supplies and furnishings funded by private giving. This amount fluctuates from year to year, depending on the timeline of construction projects. More than two-thirds of Kansas University buildings were made possible by private gifts. 16756924 223910 109443110 1 1 0 1 0 0 1 1 1 1 1 0 0 0 1 0 0 1 1 0 0 1 0 1 0 0 0 0 0 0 0 1 1 1 0 0 0 1 1 0 0 1 1057 0 1 273 1 1 1 0 0 0 0 1 1 1 2 0 0 9 7 1 0 0 0 0 1 1 1 1 0 0 1 1 1 1 1 1 1 1 0 AK CA HI LA MD MA MI MN NJ OH OK SC WA WV UT X X Jeffrey W Davis Treasurer 7858327400 1891 Constant Avenue Lawrence KS 660473743 Dale W Seuferling 40.00 X X 304353 0 99612 D Jerome Davies 40.00 X X 189954 0 35577 Jeffrey W Davis 40.00 X X 178810 0 66527 Frank J Becker 3.00 X 0 0 0 William R Docking 4.00 X 0 0 0 RA Edwards 3.00 X 0 0 0 A Drue Jennings 3.00 X 0 0 0 MD Michaelis 3.00 X 0 0 0 John T Stewart III 3.00 X 0 0 0 Todd L Sutherland 4.00 X 0 0 0 Deanell Reece Tacha 4.00 X 0 0 0 Kurt D Watson 6.00 X 0 0 0 Stephanie Grinage 40.00 X 159323 0 24437 Clark Cropp 40.00 X 139059 0 39773 John R Hillis 40.00 X 132153 0 31793 Mark P Wilson 40.00 X 118979 0 27069 James Mechler 40.00 X 143553 0 27729 William Green 40.00 X 139208 0 30078 1505392 0 382595 14 0 1 0 Turner Construction Co Inc 2345 Grand Blvd Ste 1000 Kansas City MO 64108 Construction 7155314 Adage Capital Management LP 200 Clarendon St 52nd Floor Boston MA 02116 Investment Management 881387 Wellington Management Company LLP 75 State Street Boston MA 021091827 Investment Management 851390 Cambridge Associates LLC 100 Summer St Ste 1300 Boston MA 021102104 Investment Consulting 839085 PIMCO 840 Newport Beach Ctr Dr Ste 100 Newport Beach CA 92660 Investment Management 804503 48 15784506 114106 10253772 81121659 11781775 107274043 Loan Interest 522200 1695926 1695926 Apartment Rentals 531110 147050 147050 Building Lease 531120 52200 52200 Other Real Estate 531390 24660 24660 1919836 17492613 786898 -30905 16736620 3068629 3068629 68135965 177797 74826677 67067 -6690712 110730 -6579982 -6579982 4328196 15784506 748044 3580152 3580152 Other Receipts 900099 4419228 4419228 Agriculture 110000 1092161 1092161 Oil & Gas Extraction 211110 56749 56749 5568138 132323429 2706734 25844 22316808 29480010 29480010 1094969 649706 445263 28528007 20440532 3133494 4953981 1135095 466087 669008 576915 267394 309521 618625 211873 406752 518477 398786 116232 3459 109594 109594 246081 246081 4266728 430752 3835976 3239750 2974113 89646 175991 956483 441514 28642 486327 2897198 2209137 171075 516986 670647 609726 58221 2700 583760 450908 110869 21983 227219 76445 111094 39680 3034320 2586699 48865 398756 507717 455791 23740 28186 247864 247864 814813 690793 117556 6464 194534 91124 103679 -269 Unrelated Business Tax -8086 -8086 Transfers to University 28599376 28599376 Construction 12907691 12907691 Official Hospitality 2563697 2563697 Equipment & Furnishings 1881789 1878305 2790 694 2008134 1909847 89891 8396 127901407 109443110 9738338 8719959 -83274 1948425 71284696 43911004 50155127 56986407 10605841 9685898 43230790 13514088 24853433 29716702 910029683 750951856 8010223 303583319 22810548 22763836 100444495 92115147 1198110772 1311662594 94750605 81325917 60905951 66474852 155656556 147800769 X 109040301 128611406 546282476 639399796 387131439 395850623 1042454216 1163861825 1198110772 1311662594 X 0 1 1 X 0 X 81451388 73628166 87578360 102470771 107274043 452402728 81451388 73628166 87578360 102470771 107274043 452402728 9695851 442706877 25262380 39697950 55295296 41192246 28896790 190344662 354993 368615 92132 33895 -11291 838344 643585734 67748102 0.68790 0.67670 X RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED RESTRICTED 0 0 0 109443110 109443110 1000000 250000 0 0 1000000 1000000 1000000 1000000 4000000 6000000 25242 25243 52000 0 102485 250000 250000 250000 250000 1000000 1500000 0 763524 X X X X 0 0 1 573344085 23213567 117037613 10574040 19798465 683222760 753554225 21731857 -167933094 20809436 13199467 573344085 0.00390 0.51510 0.48100 0 0 12650599 6621139 19271738 204500 19012581 9155626 10061455 4719749 4358462 361287 22222 22222 29716702 Marketable Alternative Investments 93543609 F Non-Marketable Alternative Investments 14525157 F Other LLC's and LLP's 194108443 F Real Estate, Royalty, & Mineral Interests 1406110 F 303583319 Trusts Held by Others 30917384 Interest in KU Endowment Charitable Gift Fund 434492 Special Library Collections 270724 Works of Art 492800 LCC Certificates 425 Remainder Interests 53931 Life Insurance Policies - Cash Value 8957405 Deposits - State of Kansas & Other 76403 Federal Student Loan Deposits, Adjusted for Unrecoverable 323025 Collateral for Securities Lending 50588558 92115147 132323429 127901407 4422022 118056218 -1070631 116985587 121407609 253407964 118056217 6833711 124889928 128518036 3805393 3805393 132323429 132000356 7904342 7904342 124096014 3805393 3805393 127901407 Part III, Line 4: Over the years, donors have given in-kind gifts of art and library collections, or have established funds for the purpose of purchasing such items for the museums, libraries and teaching facilities of the University of Kansas. Such gifts are administered by KU Endowment in accordance with any appropriate donor restrictions that may be placed upon the gift. Part IV, Line 2b: KU Endowment holds certain endowment and other funds on behalf of affiliates of the University and other third parties. Part V, Line 4: Description of Intended Use of Endowment Funds: Endowment Funds consist of approximately 2,500 individual fund accounts established to provide support for a variety of university programs across generations. Part XI, Line 8 - Other Adjustments: Amortization of pension adjustments: -1136698. Change in net interest in KU Endowment Charitable Gift Fund: 28460. Change in value of life income gifts: -766865. Change in value of life insurance: 804472. Part XII, Line 2d - Other Adjustments: Change in value of life income gifts: -766865. Change in net interest in KU Endowment Charitable Gift Fund: 28460. Fundraising Event Direct Expenses (see Part VIII, Line 8b): 748044. Change in value of life insurance cash value: 804472. Interfund transfer of loan proceeds: 6019600. Part XII, Line 4b - Other Adjustments: Investment income (reduced by investment expenses): 3805393. Part XIII, Line 2d - Other Adjustments: Fundraising Event Direct Expenses (see Part VIII, line 8b): 748044. Amortization of pension adjustments: 1136698. Interfund Transfer of Loan Proceeds: 6019600. Part XIII, Line 4b - Other Adjustments: Investment Expenses: 3805393. Part V, Line 1c: Upon further review of the reporting of Endowment Funds and to be consistent with the reporting of Endowment Funds in the footnotes to the audited financial statements, it was determined that cash balances of the endowment funds should be included as part of the endowment funds being reported. These amounts were not included in the prior year ending balance, thus an adjustment of $45,657,502 has been made to increase Line 1c to include these amounts in the total Endowment Funds being reported for the year. Central America and the Caribbean 0 0 Investment management fees netted from the value of investments in foreign corporations. 1887382 Europe (Including Iceland & Greenland) 0 0 Fundraising 15293 0 0 1902675 Schedule F, Part IV Other Information Schedule F, Part I, Line 3: Income from asset holdings is reported net of related investment expenses, which are disclosed as a note to the audited financial statement. X X X X X X X 1 Grenzebach Glier and Associates Inc Campaign planning, feasibility analysis 0 0 246081 -246081 246081 -246081 AK AZ AR CA CO CT HI LA ME MD MA MI MN MS MO NH NJ NY NC OH OK OR SC VA WA WV UT 20% of Right to Purchase Tickets 18228893 14583115 3645778 Cancer Center Benefit Dinner 1074164 748548 325616 74895 146200 166442 12 809645 452843 356802 24986 186531 64173 84817 20112702 15784506 4328196 24986 261426 210373 251259 748044 3580152 1 State of Kansas The University of Kansas 1502 Iowa Street 240 C-0 Lawrence KS 66045 486029925 Section 115 29480010 Student scholarships and fellowships and student and faculty awards and prizes. 1 0 Procedure for Monitoring Grants in the U.S.: Part I, Line 2: Schedule I, Part I, Line 2: Many disbursements in furtherance of the institution's exempt programs are made for student scholarships or for University employee salaries and similar expenses which are disbursed directly to the State of Kansas, University of Kansas, and which are incurred directly in the active conduct of activities constituting the exempt purpose or function for which the institution is organized and operated. Otherwise, disbursements in furtherance of the institution's exempt programs are made in accordance with accountable plan procedures and are subject to conditions established by the institution's governing board designed to ensure that individuals and organizations receiving disbursements from the organization in furtherance of its exempt programs are adequately investigated to ensure that they are qualifying recipients. Students receiving scholarships and fellowships are judged worthy by the University's assessment on the basis of academic achievement, financial need and similar standards, in accordance with applicable gift instruments. X X 1 1 X X X X 0 1 0 0 0 0 0 0 0 Dale W Seuferling 304353 0 0 0 0 0 90126 0 9486 0 403965 0 0 0 D Jerome Davies 189954 0 0 0 0 0 26354 0 9223 0 225531 0 0 0 Jeffrey W Davis 178810 0 0 0 0 0 59399 0 7127 0 245336 0 0 0 Stephanie Grinage 159323 0 0 0 0 0 19979 0 4458 0 183760 0 0 0 Clark Cropp 139059 0 0 0 0 0 30701 0 9073 0 178833 0 0 0 John R Hillis 132153 0 0 0 0 0 27461 0 4332 0 163946 0 0 0 James Mechler 143553 0 0 0 0 0 18685 0 9044 0 171282 0 0 0 William Green 139208 0 0 0 0 0 23347 0 6731 0 169286 0 0 0 Part I, Line 1a Regarding travel for companions, KU Endowment's written guidelines are as follows: "For spouse expenses to be reimbursable, the expense must be required by your supervisor and it is expected that the event in which your spouse is included will include spouses of guests, and both requirements should be stated on the reimbursement request." In keeping with this policy, travel expenses were paid for a spouse to accompany an officer to assist in a volunteer capacity with a donor development event held in the same city as a meeting of the directors, which also required attendance by the officer. Country club dues were paid on behalf of two officers and three highly compensated employees to promote fundraising efforts. Part I, Line 4a One officer meets the criteria to participate in the nonqualified retirement plan as of the participant's normal retirement date, subject to a substantial risk of forfeiture. The amount included in column (C) as deferred compensation for Dale W. Seuferling attributable to the nonqualified retirement plan is $31,229. RA Edwards Executive Committee of KU Endowment 175041 See Sch. O - R.A. Edwards is President of First National Bank of Hutchinson, which manages income-producing farm properties held by KU Endowment. 0 Kurt D Watson Executive Committee of KU Endowment 286812 See Sch. O - Kurt Watson is President of The IMA Financial Group, which receives fees as an insurance consultant and broker. 0 X 1 0 Fair Market Value X 217 5163691 Cost X 2 172284 Cost (same as proceeds) X 1 6445800 Market Comparables 2 0 1 0 Method for Determining Number of Contributors: Part I, Column (b): Schedule M, Part I, Column (b): The organization is reporting the number of contributors. Form 990, Part VI, Section A, line 1 The governing body is comprised of the members of the Executive Committee of the Board of Trustees. On October 24, 2008, the articles of incorporation and bylaws of the organization were amended to reflect that the Executive Committee of the Board of Trustees has the governance authority over the operations of the organization. These changes to the organizational documents were reported to the IRS via correspondence dated December 1, 2008. Fiscal year ending June 30, 2010 is the first full fiscal year these changes have been in effect, thus the changes are being reported on the 2009 Form 990. See explanation for lines 7a and 7b regarding the limited powers of the remaining members of the Board of Trustees. Form 990, Part VI, Section A, line 2 Todd Sutherland, R.A. Edwards, and Kurt Watson have a business relationship. M.D. Michaelis and Todd Sutherland have a buisness relationship. Form 990, Part VI, Section A, line 7a The Bylaws of the organization provide for a Board of Trustees to be comprised of 50 to 75 members. The Board of Trustees are reserved a limited number of powers which include: 1.) election or removal or to fill vacancies in the Executive Committee; and 2.) Election of the Chair of the Executive Committee. The other powers provided to the members of the Board of Trustees are outlined in the explanation to question 7b below. Form 990, Part VI, Section A, line 7b The limited powers of the members of the Board of Trustees of the organization also include: 1.) Election or removal or to fill vacancies of the members of the Board of Trustees; 2.) Change in the number of members of the Board of Trustees; 3.) Amendment of the Articles of Incorporation; and 4.) Liquidation or dissolution of KU Endowment, or disposition of all, or substantially all, of the assets of KU Endowment, or any merger of KU Endowment into or with another corporation. The Bylaws do not grant the members of the Board of Trustees any other powers other than those indicated above. A full list of the members of the Board of Trustees can be found on the organization's website: www.kuendowment.org Form 990, Part VI, Section B, line 11 Form 990 is prepared internally by the Tax and Compliance Reporting Officer. An internal review of the return is completed by appropriate KU Endowment personnel. An external tax preparer then completes a review of the return. A draft copy of Form 990 is provided to the Audit Committee to review and recommend revisions. Any such recommendations are provided in a timely manner to incorporate them in the return before transmittal to the IRS. The Audit Committee reviews the 990 on behalf of the Governing Body (the Executive Committee) and recommends approval of the 990 by the Executive Committee. The final version of the 990 is placed on the Trustee intranet and on the organization's public website. Form 990, Part VI, Section B, line 12c To monitor and enforce compliance with the conflict of interest policy, upon disclosure of a conflict of interest, the Chair of the Executive Committee or committee shall, if appropriate appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement. After exercising due diligence, the Executive Committee or committee shall determine whether KU Endowment can obtain a more advantageous transaction or arrangement with reasonable efforts from a person or entity that would not give rise to a conflict of interest. If a more advantageous transaction or arrangement is not reasonably attainable under circumstances that would not give rise to a conflict of interest, the Executive Committee or committee shall determine by a majority vote of the disinterested Members whether the transaction or arrangement is in KU Endowment's best interest and for its own benefit and whether the transaction is fair and reasonable to KU Endowment and shall make its decision as to whether to enter into the transaction or arrangement in conformity with such determination. If the Executive Committee or a standing committee has reasonable cause to believe that a Trustee has failed to disclose actual or possible conflicts of interest, it shall inform the Trustee of the basis for such belief and afford the Trustee an opportunity to explain the alleged failure to disclose. If, after hearing the response of the Trustee and making such further investigation as may be warranted in the circumstances, the Executive Committee or a standing committee determines that the Trustee has in fact failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action. Form 990, Part VI, Section B, line 15 Compensation of officers and such other persons as designated by the Executive Committee shall be determined by the Compensation Committee and be confirmed by the Executive Committee. The Executive Committee may adjust compensation determined by the Compensation Committee whenever, in its judgment, the best interests of KU Endowment would be served thereby. A Compensation Committee of not less than five nor more than seven Trustees shall be appointed annually by the Chair of the Executive Committee. The Chair of the Executive Committee shall designate one Compensation Committee member as Chair. A majority in number of the Committee shall constitute a quorum. The Compensation Committee must consist of individuals who (i) do not have a conflict of interest with respect to compensation arrangements or transactions; (ii) have obtained and relied upon appropriate data as to comparability prior to making any determination; and (iii) adequately document the basis for committee decisions concurrently with making determinations. The Committee is directed to act in a manner that will avoid the intermediate sanctions provisions of the Internal Revenue Code. Its duties shall be the review, study and recommendation of reasonable and necessary compensation for officers and employees of KU Endowment and any and all such additional functions as may from time to time be designated by the Executive Committee. Form 990, Part VI, Section C, line 18 KU Endowment was granted an exemption from federal income tax in 1934, and received additional confirmation of this exemption on June 1, 2000, and most recently on October 18, 2010. A copy of the latter is available on the organization's website under the tab, "About Us," "Publications and Reports," "Form 1023." Form 990, Part VI, Section C, line 19 KU Endowment's financial statements are available on the organization's website under the tab "About Us," "Publications and Reports," "2010 Audit Report." A copy of the organization's governing documents, including the conflict of interest policy, are available upon request. Form 990, Part VII, Section A, Column (B) Average Hours Per Week Devoted to a Related Organization The following persons listed in Section A each devoted an additional .10 hours per week to The KU Endowment Charitable Gift Fund, a related organization: Frank J. Becker, John T. Stewart III, Kurt D. Watson, Dale W. Seuferling, D. Jerome Davies, Jeffrey W. Davis. The KU Endowment Charitable Gift Fund PO Box 928 Lawrence KS 660440928 200317170 Support for KU Endowment and 501(c)(3)'s named in governing document. KS 501(c)(3) 11a, Type I N/A 0 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 The KU Endowment Charitable Gift Fund C 114106