Purpose

The purpose of this American Orthopaedic Association (“AOA”) Gift Acceptance Policy is to assure that the best interests of the donor and the AOA are served, to define acceptance or non-acceptance of proposed gifts, and to provide guidance to donors and their professional advisors in completing gifts to the AOA. The AOA encourages the solicitation and acceptance of gifts for purposes that will help it further and fulfill its mission. In reference to gift acceptance, it is the goal of this Policy to encourage funding without encumbering the organization with gifts that may generate more cost and/or risk than benefit or return. The general policy of the AOA is to inform or otherwise assist donors who wish to support its activities but never pressure or unduly persuade a donor to complete a gift. Prospective donors are offered a range of available and approved gift opportunities, as detailed in this Policy. Donors are always encouraged to seek independent, professional counsel to represent their interests.

Gift Definition

A gift is defined as a voluntary transfer of assets from a donor (a person or an organization) to the AOA where no goods or services are expected, implied, or forthcoming for the donor. Gifts are made without expectation of return; no consideration (outside of appropriate recognition) to the donor or to anyone designated by the donor may result from the contribution. A donor may receive insubstantial, intangible, token, or low-cost goods or services in exchange for a gift. Any substantial goods or services received by the donor should be reported to the donor when acknowledging the gift and should not be considered part of the gift.

Gifts that require performance of service or other consideration are not considered contributions but rather are sponsorships or some form of the contractual relationship.

A donor makes a contribution to the AOA with the understanding that the gift is an irrevocable transfer of assets. The AOA is not obliged to return unexpected funds or unused assets. If, for some reason, the AOA is unable to comply with the donor’s intent, if the intended program has been discontinued and no mission-consistent activity may be substituted, or if the gift has been misdirected to the AOA, a return of the gift may be issued at AOA’S discretion. Out-of-pocket expenses may be deducted from the gift before it is returned.

AOA does not market specifically named financial products, nor does it recommend or endorse the services and/or products of any professional financial advisor including, but not limited to, attorneys, accountants, trustees, financial advisors, and consultants. The AOA and AOA staff will not manage trusts or serve as a trustee or witness to any bequest or will, successor trustee, or representative for any donor or donation. The AOA cannot reimburse or otherwise pay for donor professional services utilized to execute the gift to the AOA.

Form of Gift – Allowable Gift Vehicles

The AOA gratefully encourages and accepts gifts of cash as the preferred donation vehicle; gifts may take the form of securities and the other gift forms listed below. It is the policy of the AOA to convert non-cash gifts to cash as soon as possible. The following list of gifts are the approved vehicles that may be considered for acceptance:

  • Cash
  • Online donations via www.aoassn.org
  • Wire transfer of funds
  • Credit card contributions
  • Publicly traded securities; gifts of securities that are not readily marketable must receive approval prior to acceptance
  • For those donors age 65 or older, bequests through wills*
  • IRAs and retirement plan beneficiary designations
  • For those donors age 65 or older, paid life insurance policies and new life insurance policies with an irrevocable beneficiary designation (accepted where the AOA is designated as a beneficiary)
  • Royalties and distribution rights
  • Certain transfers of real estate/remainder interests in real property**
  • Certain planned gifts, such as Charitable Lead Trusts and Charitable Remainder Trusts (where the AOA is the beneficiary and donor is the trustee)

*For non-cash gifts resulting from bequests, the personal representative will be asked to sell the property and remit the proceeds to the AOA.

**The AOA will consider the acceptance of such gifts; no gift of real estate shall be accepted without clear title, evaluation of salability, lack of third-party interests, and environmental scrutiny (where applicable/for commercial real estate assets).

Gift Criteria

  • The following criteria generally identify a gift
  • Gifts are motivated by charitable intent.
  • Gifts are irrevocable transfers of assets.
  • Gifts are not generally subject to exchange or consideration or other contractual duties between the AOA and the donor.
  • Donors are not provided formal financial accounting. A general report to the donor, stating the utilization or impact of the gift is appropriate and may be desirable, especially in the case of named gifts or significant gifts to the endowment.
  • Generally, funds received from individuals, closely-held corporations, and family foundations will be classified as gifts.
  • A gift is not completed until it has been accepted by the AOA or, in the case of securities, bonds, or mutual funds, when deposited into the AOA account.

Gift Acceptance

The AOA or AOA representatives should not accept a gift unless there is a reasonable expectation that acceptance of the gift will ultimately benefit the mission of the AOA. The AOA reserves the right to decline acceptance of a gift when a gift is deemed not to further the AOA mission or goals. Furthermore, any gift that would create an administrative burden or excessive expense or obligation to the organization would also be considered for declination.

Donors will be encouraged to consult with their own legal and financial consultants in all cases and, particularly when considering a major gift, a charitable trust gift, retained life estate, or other complex gift agreement or that names the AOA as beneficiary.

The AOA is committed to compliance with all applicable laws and regulations, donor designations, and ethical standards.

Authorization to accept non-cash and non-securities gifts that are not readily marketable shall come from the AOA Executive Director. The AOA Executive Committee retains all final authority with regard to the approval of policies and procedures relating to the organization’s individual giving program. The Finance Committee shall serve as the reviewing body where gift acceptance questions are at issue.

Federal tax law does not permit donors to dictate or restrict investment decisions with regard to the maintenance of irrevocable gifts. Establishment and governance of all planned gifts shall be in direct accordance with and subject to the IRS tax code, revenue rulings of the U.S. Government, and the laws of the State of Illinois.

It is recognized that certain gifts, including but not limited to those involving unusual funding arrangement, should not be routinely processed, but should be reviewed by the Executive Director in consultation as needed with the Executive Staff, Development Committee representatives, and Executive Committee. The Executive Director will approve all planned gifts for which the AOA has been named prior to execution.

Designations and Restricted Gifts

Because it is the policy of the AOA to encourage gifts for the general purposes of the AOA in support of the AOA mission, the donor may not place restrictions on the investment of or use of the gift outside of designating specific, approved AOA program/offering support. The donor may not retain control over the money or property transferred to the AOA to qualify as a current gift or require that AOA engage a specific vendor as a condition of the gift. Significant gifts that have the potential to alter existing, or create new programs/offerings will be reviewed and considered for acceptance by the AOA Executive Committee. The AOA will not accept gifts that create or fund programs that will compromise or jeopardize its 501(c)(3) tax status.

Donations may be designated by donors for approved programs and projects of the AOA. Use of these funds will be governed by the Policy on Management, Investment and Use of Funds approved by the AOA Executive Committee.

Donors of major gifts that fall into the “Transformational Gift” category of $1M or greater shall have the opportunity to elect a naming right for an approved AOA program or offering, consistent with the AOA Naming Policy.

The AOA shall offer individuals the opportunity to underwrite approved, one-time programs or publications by contributing the amount necessary to develop and complete the program or publication. Recognition of donors in this category shall be consistent with overall AOA recognition level attribution.

Administration

The administration and management of gifts will be guided by these principles. The AOA will:

  • Follow generally-approved accounting procedures
  • Honor the donor’s intent so that donors are assured their gifts will be used for the purposes for which they were given.
  • Administer and manage funds in an efficient manner.
  • Be transparent in reporting the use of funds to donors, members, and the public.
  • Follow AOA gift acceptance policies and procedures.
  • Use funds in an ethical and compliant manner that is in accordance with applicable state and federal laws.
  • Be good stewards of funds received.
  • Hold in confidence all information obtained from or about donors/prospective donors.

Stewardship of gifts shall be overseen by the AOA Development Committee. In order to manage the AOA Development functions and to help cover the costs of fundraising, up to 15% of funds raised each year can be used to cover direct fundraising costs incurrent by the Development Committee.