Accountability

Objectives of the Audit Committee

• Oversee the integrity of the Foundation's financial accounting/reporting process and system of internal controls regarding accounting and use of assets.
• Oversee the independence and performance of the independent auditors.
• Provide an avenue of communication among the Foundation's independent auditors, management, staff, and the Board of Directors.
• Recommend to the Board the selection of the independent auditors and the appropriate fee.

Membership of the Audit Committee

• Shall be comprised of three or more directors, as well as Advisory Directors, as permitted in the By-Laws.
• Shall include a minimum of two members that are "financially literate" or become financially literate within a reasonable period of time after joining the Audit Committee.
  • "Financial literacy" is defined as the ability to read and understand fundamental financial statements.
• Shall include at least one member that has "accounting or related financial management expertise."
  • The "accounting or related financial management expertise" requirement can be met through past employment experience in finance or accounting, requisite professional certification in accounting, or any other comparable experience/background which results in the individual's financial sophistication, including being or having been a public accountant or auditor.
• Members of the Audit Committee should not serve on the Budget Committee.
• A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Meetings of the Audit Committee

• Meetings shall be held at least twice each year.
• Additional meetings, via teleconference or in person, may be held as needed.

Functions of the Audit Committee

1. Audit Planning and Preparation

• Review with the independent auditors the scope of the annual audit, including the areas where the auditors have identified a risk of potential material error in the financial condition and/or results of operations.
• Assess whether appropriate co\operation is being provided to the independent auditors by the organization's staff.
• Review control weaknesses detected in the prior year's audit and determine whether all practical steps have been taken to overcome them.
• Approve the independent auditors' engagement letter, including the audit fee and expenses.

2. Information and Control Systems

• Inquire of management and the independent auditors about changes in the financial systems and control systems during the year.
• Inquire into the condition of the records and the adequacy of resources committed to accounting and controls.
• Inquire into the major financial risks faced by the organization and the appropriateness of related controls to minimize their potential impact.

3. Annual Financial Statements

• Review the financial statements, asking questions about the following:
  • the selection of and changes in accounting policies,
  • methods used to account for unusual or particularly significant transactions,
  • issues on which management has made estimates or judgments that had a significant effect on the financial statements,
  • the reasonableness of the estimates and judgments, and
  • significant transactions with related parties.
• Inquire about changes in professional standards or regulatory requirements.
• Review the Form 990.
• Recommend to the Board the approval of the Form 990 filed with the Internal Revenue Service.

4. Audit Results

• Review the independent auditors' proposed report on the financial statements.
• Review the independent auditors' report of required communications concerning the performance of the audit.
• Review the independent auditors' "management letter" documenting any weaknesses in internal control systems and commenting on other matters.
• Discuss with the auditors whether there are concerns such as, lack of cooperation or disagreements with management; attempts to restrict the scope of the auditors' examination; significant misstatements or irregularities.
• Hold separate executive sessions with management and the independent auditor to discuss any problems or issues not previously discussed.

5. Auditors' Selection

• Discuss with senior management whether there are any concerns about how the audit was conducted.
• Inquire as to the experience and capabilities of the individuals being proposed to conduct the audit, their objectivity and independence.
• Evaluate independent auditors' fees and rotation policy—either the partner, the firm, or both.
• Recommend to the Board the independent auditors to be selected for the following year.

6. Administration

• Review the Committee's performance annually.
• Review the Charter annually.

Objectives of the Budget Committee

• Establish Foundation financial priorities.
• Review management's accounting processes for contributions.
• Oversee the production of and monitor the annual operating budget.
• Oversee the production of the Foundation's financial statements.
• Report financial and budget performance to the Board.
• Recommend any adjustments necessary in the budget to the Board.
• Provide an avenue for communication among the Foundation's staff and the Board of Directors regarding budget management issues.
• Determine the appropriate management fee and make recommendation to the Board.

Membership of the Budget Committee

• Membership shall be comprised of five or more directors, as well as up to two Advisory Directors, as permitted in the By-Laws.
• Include the current Treasurer of the Foundation, who shall serve as Chair of the Budget Committee.
• A member of the Audit Committee should not serve on the Budget Committee.

Meetings of the Budget Committee

• Meetings shall be held as called by the Committee Chair to review and recommend the annual budget.
• Additional meetings, via teleconference or in person, may be held as needed.
• A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Functions of the Budget Committee

1. Oversee the Operating Budget

• Research, development, monitoring, adjustment, and reporting of the annual operating budget.
• Closely coordinate with staff to implement the budget.

2. Quarterly Performance Review

• Oversee the Foundation in operating its financial processes in accord with U.S. Generally Accepted Accounting Principles (GAAP).
• Review the financial and budget reports and recommendations prepared by staff.
• Report financial performance to the Board.

3. Administration

• Discuss situations in the Foundation that pertain to budget decisions.
• Keep abreast of legislation, accounting standards, and industry guidelines affecting management of fiduciary funds.
• Review the Committee's performance annually.
• Review the Charter annually.

The development activities and initiatives of the Foundation as a whole and the Development Committee specifically will be under the leadership and direction of the UNT Vice President for Advancement/Foundation Director of Development and will comply with the letter and spirit of the August 2009 Agreement between the University of North Texas and the University of North Texas Foundation, Inc.

Objectives of the Development Committee

• Assist University staff in efforts to increase major public, private, corporate, and Foundation giving to the University of North Texas.
• Cultivate the effective stewardship of donors of gifts.
• Educate and encourage Board Members in their personal philanthropy towards the University.
• Provide an avenue for communication among the Foundation's management staff and the Board of Directors regarding development issues.
• Strengthen the Foundation's reputation and the University's image.

Membership of the Development Committee

• Membership shall be comprised of five or more directors, as well as Advisory Directors, as permitted by the By-Laws.
• The Vice President for Advancement/Foundation Director of Development shall serve as an ex officio member of the Committee.

Meetings of the Development Committee

• Meetings shall be held as called by the Committee Chair.
• Additional meetings, via teleconference or in person, may be held as needed.
• A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Functions of the Development Committee

The University's Vice President for Advancement shall serve as the Foundation's Director of Development and oversee, coordinate, and have decision-making authority over the fundraising activities of both the University and the Foundation, as is consistent with the agreement between the two entities.

1. Fundraising

• Work with the UNT Advancement staff to secure additional major gifts.
• Encourage direct involvement by Foundation Board Members in the major gift fundraising effort.
• Encourage Foundation Board Members to make individual, personal gifts to Foundation accounts.
• Assist Foundation Board Members in raising funds in accord with the professional and ethical standards of the:
  • Council for the Advancement and Support of Education (CASE)
  • Association of Fundraising Professionals (AFP)
  • Partnership for Philanthropic Planning (PPP).
• Enlist additional volunteers who can contribute to increased fundraising action.
• Refer prospective donors to University Advancement staff.

2. Gift Acceptance Policies

• Review the Gift Acceptance Policies section of the Foundation Policies and Procedures manual annually.
• Recommend adjustments in the Gift Acceptance Policies to the Board of Directors as needed.

3. Major Donor Appreciation Activities

• Work with Foundation and University Advancement staff to recognize and thank major donors and their advisors.
• Involve UNT Advancement representatives appropriately in the recognition process.
• Promote UNT's stewardship and recognition programs.

4. Administration

• Discuss situations at the University that pertain to development decisions, including
  • the continuing need for current and sustainable growth in endowed funds,
  • special situations (financial offerings, capital campaigns, agency funds), and
  • UNT's resource allocation processes (staffing, communications, events).
• Review the Committee's performance annually.
• Review the Charter annually.

Objective of the Governance Committee

The objective of the Governance Committee is to assist the Board of Directors in fulfilling its responsibilities by developing, recommending, monitoring, and periodically reviewing the governance policies and practices of the Board, which includes the By-Laws of the Foundation. The Committee also is involved in recruiting new Board Members and ensuring that each member is equipped with the proper tools and motivation to carry out his or her responsibilities. The Committee shall function as the Nominating Committee of the Board.

Membership of the Governance Committee

• Membership shall be comprised of five or more directors.
• The Chair of the Board of Directors shall not serve on the Committee.
• The President of the University, the University's Vice President for Advancement, and the Chair of the North Texas Alumni Association Board shall serve as ex officio members with the Nominating function of the Committee.

Meetings of the Governance Committee

Meetings shall be held as called by the Committee Chair.

Additional meetings may be held, via teleconference or in person, as needed.

A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Functions of the Governance Committee

For the Board:

• Recommend the Board Composition.
• Create a three-year succession plan for Board membership and leadership.
• Maintain a Statement of Criteria for nominees to the Board.
• Develop and manage a network of new Director candidates.
• Develop and manage an orientation program for new Directors.
• Develop strategies and policies that attract, orient, educate, motivate, and assess the performance of Directors.
• Assess Director Performance.
• Decide whether to renominate sitting Directors.
• Develop a program for Board Member recognition.
• Develop programs that continue the commitment of former Directors.
• Manage the nominations process for Officers and Directors of the Board.

Administration:

• Review the Governance Committee's Charter and performance annually.
• Determine that the standing Committees have completed their annual Charter Reviews and self-assessments.
• Oversee matters concerning the By-Laws, including:
• Maintain the By-Laws of the Foundation.
• Develop revisions to the By-Laws as needed to maintain compliance with State of Texas Legislation, Foundation policies, and contractual obligations.
• Respond to questions and issues pertaining to the By-Laws raised by the Board of Directors.
• Provide an avenue for communication among the Foundation's management staff and the Board of Directors regarding By-Laws issues.

(See the "The Governance Committee" – an amended version of Chapter 5 of the AGB publication: Margin of Excellence, The New Work of Higher Education Foundations for further explanation of the "Functions" above.)

Objectives of the Investment Committee

• Maintain the highest level of performance in the investment portfolio at the most economical cost in accord with the concept of “generational neutrality”.
• Work closely with staff and professional advisors to review and analyze investment allocation, performance, and reporting.
• Report on investment performance and other issues to the Board, and recommend any adjustments in the investment program.
• Provide an avenue for communication among the Foundation's staff and the Board of Directors regarding investment management issues.

Membership of the Investment Committee

• Membership shall be comprised of five or more directors, as well as up to two Advisory Directors, as permitted by the By-Laws.
• Shall limit the number of Advisory Directors to no more than one-third (1/3) of the membership.
• The Chair of the Budget Committee or the Chair of the Audit Committee should not serve on the Investment Committee.
• A majority of the members should qualify as an Accredited Investor as defined by Rule 501, Regulation D of the Securities and Exchange Commission.

Meetings of the Investment Committee

• Meetings shall be held at least four times each year.
• Additional meetings, via teleconference or in person, may be held as needed.
• A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Functions of the Investment Committee

1. Investment Policy Statement

• Annually review the Investment Policy Statement (IPS) with the assistance of the Investment Consultant and staff.
• Give staff direction in the implementation of the IPS.
• Assess whether appropriate implementation of the IPS is being accomplished.
• Recommend changes and modifications in the IPS to the Board as needed.
• Recommend asset allocations.
• Recommend spending limits.

2. Investment Consultant

• Evaluate Investment Consultant performance annually and recommend any changes in engagement to the Board.
• Approve the Investment Consultant’s engagement letter, including all fees and expenses.
• Develop and implement a request for proposal for investment consulting services.
• Screen and interview candidates, and recommend an Investment Consultant to the Board.

3. Quarterly Performance Review

• Review the Investment Consultant reports and recommendations, asking questions about the following:
  • the selection of and changes in asset classes,
  • the selection of and changes in money managers,
  • reasons for unusual or particularly significant investment performance, and
  • economic trends and conditions impacting future investment decisions.
• Compare the portfolio pool performance to defined benchmark performance.

4. Administration

• Discuss situations at the University that pertain to investment decisions:
  • The need for current and sustainable income, and
  • Special situations (investment offerings, capital campaigns, agency funds).
• Keep abreast of legislation, accounting standards, and industry guidelines affecting management of fiduciary funds.
• Review the Committee’s performance annually.
• Review the Charter annually.

Investment Committee Members

MARK P. HURLEY, Committee Chair
President & CEO
Fiduciary Network Dallas, Texas

BRADLEY BOURLAND
President, COO
Diesslin & Associates
Fort Worth, Texas

R. L. CRAWFORD JR.
Senior Financial Representative
Northwestern Mutual Financial Network
Lewisville, Texas

JERRY DICKENSON
Robert Dedman Chair In Club Management
University of North Texas
Denton, Texas

PHIL DIEBEL
Retired VP Finance & Bus.
University of North Texas
Denton, Texas

TIMOTHY L. DWIGHT
Vice President, Wealth Manager
True North Advisors, LLC
Dallas, Texas

SAM GOLDEN
Managing Director
Alvarez & Marsal, LLC
Houston, Texas

THOMAS E. MUIR
CPA, CFP
Rench & Muir Financial Advisors
Denton, Texas

KEN NEWMAN
Retired CEO
Horizon Health Croup, Inc.
Denton, Texas

BOB KIMMEL
President, COO
Davis H. Elliot Co.
Tulsa, Oklahoma

Objectives of the Trust Management & Real Estate Committee

• Oversee the successful and prudent operation of Charitable Trusts, Gift Annuities, and Estates for which the Foundation serves as Trustee, Executor, or Administrator.
• Manage these assets to facilitate the increase in number and size of gift arrangements for which the Foundation serves as Trustee, Executor, or Administrator.
• Report on asset composition and performance to the Board, and recommend any adjustments in management.
• Increase the assets of the Foundation and the University through gifts of real property that can be liquidated, held to produce income, or enhance the Mission of the University.
• Provide an avenue for communication among the Foundation's management staff and the Board of Directors regarding management of these assets.

Membership of the Trust Management & Real Estate Committee

• Membership shall be comprised of five or more directors, as well as Advisory Directors, as permitted by the By-Laws

Meetings of the Trust Management & Real Estate Committee

• Meetings shall be held at the discretion of the Committee Chair.
• Additional meetings, via teleconference or in person, may be held as needed.
• A quorum consisting of 50% or more of the Committee members is required to conduct the business of the Committee.

Functions of the Trust Management & Real Estate Committee

1. Trust and Gift Annuity Policies

• Annually review the Trust and Gift Annuity Policies (“policies”) sections of the Gift Acceptance Policies for Board approval.
• Give staff direction in the implementation of these policies.
• Assess whether appropriate implementation of these policies is occurring.
• Recommend changes and modifications in the policies to the Board as needed.

2. Custodian Relationship for Trusts

• Evaluate the Trust Custodian performance annually and recommend any changes in engagement to the Board.
• Approve the Trust Custodian engagement letter, including all fees and expenses.
• Develop and implement a request for proposal for Trust custodial services.
• Screen and interview candidates, and recommend the best Trust Custodian to the Board.

3. Trust Administration

• Understand the types of Trust and Gift Annuity Contracts under management.
• Keep abreast of legislation and industry guidelines affecting management of Trust assets.
• Recommend adjustments to policies and procedures to accommodate current laws and industry best practices.

4. Quarterly Trust and Annuity Performance Review

• Review the Trust Custodian reports and recommendations, asking questions about:
  • the selection of and changes in asset classes,
  • the selection of and changes in money managers,
  • reasons for unusual or particularly significant investment performance, and
  • economic trends and conditions impacting future investment decisions.
• Review staff reports of Gift Annuity Contract performance and activity, asking questions about:
  • Mortality risk, Market risk, Portfolio risk, and Spending risk.

5. Estate Administration

• Review Estates initially submitted for Administration by staff.
• Review progress reports from staff regarding Estate Administration.
• Report progress with the Administration of each Estate to the Board.

6. Real Estate

• Work closely with staff to analyze and evaluate potential gifts or transactions of Real Estate for the benefit of the Foundation and/or the University.
• Recommend acceptance or refusal of proposed gifts of Real Estate.
• Report on Real Estate holdings and related issues to the Board, and recommend any adjustments in the Real Estate program.

7. Gift Acceptance Policies

• Annually review the Gifts of Real Estate area of the Gift Acceptance Policies section in the Foundation Policies and Procedures manual.
• Recommend adjustments in the Gifts of Real Estate section of the Gift Acceptance Policies to the Board of Directors as needed.

8. Administration

• Discuss situations at the University that pertain to potential Trust and/or Real Estate opportunities and decisions.
• Review the Committee’s performance annually.
• Review the Charter

Foundation Affiliations' Websites:

• ACGA - American Council on Gift Annuities
  www.acga-web.org
• AICPA - American Institute of Certified Public Accountants
  www.aicpa.org
• AFP - Association of Fundraising Professionals
  www.afpnet.org
• AGB - Association of Governing Boards of Universities and Colleges
  www.agb.org
• CASE - Council for Advancement and Support of Education
  www.case.org
• FASB - Financial Accounting Standards Board
  www.fasb.org
• GAAP - Generally Accepted Accounting Principles in the United States
  www.cpaclass.com/gaap
• NCPG - National Association of Estate Planners and Councils
  www.naepc.org
• TSCPA - Texas Society of Certified Public Accountants
  www.tscpa.org