Can the spending distribution for an endowment ever go down from one year to the next?
During the most volatile financial times this outcome is possible. However, while the market value reported each quarter might be quite volatile, the spending amount usually changes very gradually.

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What happens when endowment earnings exceed the amount calculated for spending?
Earnings in excess of the spending distribution and fees remain in the endowment, thus contributing to its future growth.

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The endowment has been invested for a year, why did it not receive spending?
Typically the first year for the endowment may not be a period of growth. A newly endowed fund incurs a one-time gift fee (three percent of all gifts), and a management fee (two percent annually). This reduces the market value of the endowment. When the spending is calculated, the market value may be less than the corpus (the total of all contributions to the endowment) value.
In addition, the endowment must be invested at its minimum for at least one year before qualifying for spending.

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What type of expenses are charged to the endowment investment account?
The types of fees assessed to the endowment investment account include custodial, investment management, consultant, foundation management and revenue.
Other expenses such as scholarships, research equipment and salaries for chairs are charged to the endowment spending account.

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Does the spending amount receive earnings?
Earnings are only allocated to the endowment investment accounts. Since the spendable amounts are transferred out of the endowment pool and into a spendable account, the spendable amounts are not allocated earnings.

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What fees are applied to endowments?
A one-time administrative fee of three percent is applied to all new endowments. Additionally, a two percent annual fee is applied to all endowments. These fees are designed to cover operating and fund management costs.