Best Of

1)     What are your procedures for closing a fund that is currently in an investment pool?

2)     Do you have a policy that explicitly states these procedures that the fund holder receives/signs off on as part of the onboarding process (i.e. Fund Agreement and/or Terms & Conditions)? If so, could you please share?

Our current practice is to 1) Clearly communicate with the fund holder that closing a fund comes in two separate distributions. The first distribution represents the majority of the fund balance and would be distributed ASAP. 2) On the first of the following month, disable “Revenue Share” to stop allocating them investment earnings. 3) The second and final distribution would happen the following month after the current month's earnings have been calculated and final monthly admin fee assessed.

The Achilles heel to this approach is that our investment earnings are received monthly (usually around the 10th of the month), and the fund holder would therefore be “out of the market” for ~ two weeks before all of its monies are received. We realize that some agencies may not be happy about that. 

Hi-

We include this language in our letters/ grant agreements.

"Payment will be made via ACH upon receipt and confirmation of your organization’s banking information. "

Part of our process includes asking in the application (or follow-up) for the finance contact who will be invited to complete and upload a form we created to a secure portal. We also require a bank letter or voided check to confirm the information is correct.

Finally, we do a verbal confirmation for any new organizations or groups who have changed their banking information. We ask this question in a follow-up once the grant has been approved.

Happy to discuss further. I posted a thread on the PEAK board last month.