Restriction Classifications:

Restriction classification is an accounting attribute.  Only funds given by an outside entity (i.e., gifts or income from endowments) may be recorded in a restricted account.  All other types of income are classified as unrestricted on the university's financial statements.

The attribute in ADW that represents the restriction classification is "Fas Restrict Class."

Permanently Restricted:

• Assets that will be maintained permanently or invested in perpetuity
• Can never be removed by actions of the organization, although the restriction can be removed by court order
• Generally, only includes true endowments

Temporarily Restricted:

• Donated assets that may be used only after a specified period of time or only for a specific purpose, or both
• The restriction is satisfied either by the passage of time or by actions of the organization

Unrestricted:

• The donor has made no limitations or restrictions on the use of funds.  Gift is "for Cornell"
• Gifts with no restrictions other than to a college or department are treated as unrestricted.  This practice is called "simultaneous release"

Department Responsibilities for Managing Restrictions:

1. Department personnel should have a sound understanding of restriction classifications, and be aware of the restrictions on all accounts for which they have responsibilities.
2. Departments should review (before the end of the fiscal year) all unrestricted (UR) gifts.  Compare total departmental UR gifts to total departmental UR expenses during same time period.  See "simultaneous release" page for more information.
   This basic ADW query  can provide the information needed to evaluate UR gifts.
3. Temporarily restricted (TR) funds should be spent first!  Financial Accounting Standards require that restricted funds be spent (according to donor designations) before unrestricted funds are used.  Departments should monitor activity to see if TR funds are being spent before unrestricted funds. Any one of three basic ADW queries  may provide information to assist with evaluating TR gifts.  The queries include:  comparing beginning balance with the to-date balance to see if the balances have not changed, query the last transaction date to identify accounts with no activity, and to review current year-to-date debits and credits to identify accounts that continue to grow, but are not being spent.