Four Numbers, One Fundraising Story: Why University Foundation Reports Don’t Match the Financial Statements

Funds Received, New Funds Committed, campaign totals and GAAP revenue are designed to answer different questions. 

A university foundation can have a very successful fundraising year and still encounter an uncomfortable question at a board meeting: 

“Advancement says we raised $75 million. Why do the financial statements show only $48 million of contribution revenue?” 

The natural reaction may be to assume that one of the numbers is wrong. Often, neither is. University foundation’s operate in an environment where the same philanthropic activity can be measured several different ways. Advancement may report cash received, new fundraising commitments or progress toward a multiyear campaign. Finance reports revenue according to generally accepted accounting principles (GAAP). 

Those measures serve different purposes, and the differences can be significant. 

The objective should not be to make every fundraising report agree with the audited financial statements. It should be to understand what each number represents and be able to explain how the numbers relate to one another. 

Start With the Question Each Number Answers 

The Council for Advancement and Support of Education (CASE) publishes the CASE Global Reporting Standards, which provide a common framework for counting and reporting fundraising performance in higher education. CASE reporting is not an alternative accounting framework. It measures philanthropic activity using definitions developed for advancement and fundraising purposes. 

Two important annual CASE measures are Funds Received and New Funds Committed. 

Funds Received focuses on philanthropic resources actually received during the reporting year. That can include outright gifts as well as payments collected on pledges secured in prior years. 

New Funds Committed asks a different question: What new fundraising was secured during the year? It includes new outright gifts, documented pledges and other qualifying commitments. A payment received this year on a pledge secured three years ago may therefore be included in Funds Received without representing current-year New Funds Committed. 

One measures resources coming through the door. The other measures new fundraising activity. 

There is also a third number: campaign progress. A comprehensive campaign may span several years and accumulate qualifying gifts and commitments throughout its designated campaign period, including its quiet phase. The resulting campaign total is neither a current-year cash measure nor simply a current-year fundraising measure. 

Finally, finance has a fourth number: GAAP revenue. That amount is determined under the accounting standards applicable to the foundation and is intended to report the organization’s financial activity—not evaluate the productivity of its advancement program. 

For many university foundations, all four numbers are useful. They simply answer different questions. 

One Pledge Can Illustrate the Difference 

A multiyear pledge provides a good example. CASE updated its standards in 2024 to permit the full value of a documented multiyear pledge to be included in New Funds Committed, even when payments extend beyond five years. 

Assume a donor signs a $10 million pledge payable evenly over 10 years. For annual CASE reporting, the full $10 million may be reported as New Funds Committed in the year the pledge is secured. Funds Received, however, reflects the amounts actually collected over time. 

Campaign reporting has a different rule. CASE generally includes pledges in campaign totals when payments are scheduled during the campaign or within five years after the campaign ends. 

If the $10 million pledge were signed on the final day of a campaign and paid evenly over 10 years, the same commitment could therefore produce: 

• $10 million of New Funds Committed; 

• $1 million of Funds Received as each annual payment is collected; and 

• $5 million of campaign credit. 

The GAAP result may be different again. Accounting recognition depends on whether the foundation follows FASB or GASB standards, the terms of the pledge and the applicable recognition and measurement requirements. As a result, GAAP revenue may not equal any of the three fundraising measures. 

That does not mean the reports are inconsistent. Each is measuring something different. 

Some Gifts Widen the Gap Further 

Conditional and planned gifts can make the differences even more pronounced. Consider a donor who commits $5 million toward a new facility, contingent on the institution raising an additional amount from other donors. CASE permits certain conditional pledges to be reported when they are appropriately documented and there is a reasonable expectation that the conditions will be met. 

Financial accounting follows its own recognition analysis. Depending on the terms of the gift and the applicable accounting framework, finance may not recognize that same commitment as revenue at the same time. 

Planned gifts create a different timing issue. CASE permits certain planned gifts and documented bequest or legacy intentions to be included in fundraising reporting. For campaigns, revocable planned gifts are reported separately from outright gifts and pledges and from irrevocable planned gifts. CASE also generally requires the donor to be at least age 65 by the end of the campaign for a revocable bequest or legacy intention to be included in campaign totals. 

That separate reporting is useful because the economics are very different. A $5 million cash gift provides $5 million of resources today. A $5 million revocable estate intention may represent an important donor relationship and significant potential future support, but the foundation does not have $5 million available to spend. 

A single headline number labeled “amount raised” can obscure those differences. 

Campaign Policies Should Be Established Up Front 

This becomes particularly important during a comprehensive campaign. CASE recommends that institutions establish campaign reporting policies before the campaign begins, communicate what will be counted and apply those policies consistently throughout the campaign. The campaign plan should address the treatment of items such as outright gifts and pledges, irrevocable and revocable planned gifts and gifts-in-kind. 

CASE also generally discourages counting gifts from outside the designated campaign period, although an institution may establish a policy for limited “reach-back” or “reach-forward” exceptions with appropriate approval. 

For foundation leadership, the larger point is not simply compliance with CASE guidance. A campaign may run for years and ultimately report hundreds of millions—or billions—of dollars. Advancement, finance and campaign leadership should agree at the outset on what the campaign total represents. They should also understand how that total will differ from annual fundraising measures and the foundation’s financial statements. 

Build a Bridge Between Advancement and Finance 

Differences between fundraising and accounting reports should be expected. Unexplained differences should not be. 

A useful practice is to develop a recurring reporting bridge between advancement and finance. It does not necessarily need to reconcile every fundraising metric dollar-for-dollar to GAAP revenue. Instead, it should identify the major reasons the measures differ. 

Depending on the foundation, those differences might include: 

• new multiyear pledges; 

• collections on commitments reported in prior periods; 

• conditional pledges; 

• planned gifts; 

• pledge write-offs or changes in estimates; and 

• timing or valuation differences between fundraising and accounting standards. 

The terminology used in board reporting also matters. Saying that a foundation “raised $100 million” leaves an important question unanswered. Does that mean $100 million of cash received? New commitments? Campaign credit? Does it include planned gifts? 

A dashboard labeled New Funds Committed: $100 million communicates something very different from one labeled Funds Received: $100 million. Clear labels may sound like a small matter, but they can prevent significant confusion—particularly when campaign results, advancement reports and audited financial statements are presented to the same board. 

Different Numbers Should Tell a Consistent Story 

Finance and advancement do not need identical reports. Trying to force them to report the same number would eliminate useful information. Advancement needs to understand donor activity, commitments and fundraising performance. Finance needs to report the foundation’s financial position and results in accordance with GAAP. Campaign leadership needs a cumulative measure of progress against a multiyear goal. 

These are different responsibilities, but they should not operate in isolation. 

When a board member asks why a campaign has raised $500 million while the financial statements report substantially less contribution revenue, the answer should be more informative than “one is fundraising and one is accounting.” 

Foundation leadership should be able to explain what each number represents, why the amounts differ and how they fit together. For university foundations, getting ahead of these differences requires coordination between advancement and finance, clear reporting policies and a repeatable process for reconciling the key measures. That becomes particularly important during a comprehensive campaign, when the differences among campaign results, annual fundraising activity and GAAP reporting can become even more pronounced. 

If your foundation is evaluating its fundraising or campaign reporting, or wants to build a clearer bridge between advancement reporting and the financial statements, our higher education team can help. James Moore’s Higher Education practice specializes in supporting foundations with reporting strategies and financial governance.

Contact a James Moore higher education professional to discuss your reporting policies, reconciliation process and the financial reporting implications for your organization. 

All content provided in this article is for informational purposes only. Matters discussed in this article are subject to change. For up-to-date information on this subject, please contact a James Moore professional.