Julep’s Nonprofit Glossary
-F-
Face-To-Face Solicitation: Speaking to a prospective donor in person.
Facilitation: Planning and managing productive meetings, retreats, etc. that engage internal and/or external constituencies.
Fair Market Value: (FMV) In the simplest sense, it is the price that property would sell for on the open market. It is an estimate of the value of an item and, if your nonprofit is selling items or event tickets to raise money, should be subtracted from the total donation amount to determine the tax-deductible amount.
Faith-based Charities: A religious organization whose purpose is to aid those in need.
Family Dynamics: Building the performance and effectiveness of family members to work together to achieve philanthropic objectives.
Family Foundation: An independent private foundation whose funds are derived from members of a single family. At least one family member must continue to serve as an officer or board member of the foundation, and as the donor, they or their relatives play a significant role in governing and/or managing the foundation throughout its life. Most family foundations are run by family members who serve as trustees or directors on a voluntary basis-receiving no compensation. In many cases, second- and third-generation descendants of the original donors manage the foundation. Most family foundations concentrate their giving locally, in their communities. Since this is not a legal term, there is no precise definition.
Federated Organization: An organizational structure composed of an umbrella organization (national or regional) with smaller local chapters.
Fiduciary: Relating to or pertaining to the holding of something in trust.
Fiduciary Duties
Fiduciary Duties: A legal obligation to act in the best interest of another entity or person. In the nonprofit sector, members of the board of directors have a fiduciary duty to act in the best interest of the organization, including in activities related to the funds and other assets owned by the nonprofit.
Field of Interest Fund: A fund held by a community foundation that is used for a specific charitable purpose such as education or health research.
Financial Accounting Standards Board: (FASB) The national governing board which sets the accounting standards known as Generally Accepted Accounting Principles (GAAP).
Financial Report: An accounting statement detailing financial data, including income from all sources, expenses, assets, and liabilities. A financial report may also be an itemized accounting that shows how grant funds were used by a grantee organization. Most foundations require a financial report from grantees.
Financial Statements: A set of reports usually including a statement of financial position, a statement of activities, a statement of cash flows, and a statement of functional expenses.
Fiscal Sponsor: A fiscal sponsor is a nonprofit organization that provides fiduciary oversight, financial management, and other administrative services to help build the capacity of charitable projects. Fiscal sponsorships are useful for organizations that are not yet recognized as tax-exempt under Internal Revenue Code Section 501 (c)(3) or that simply have decided that operating under the umbrella of another tax-exempt organization makes sense.
Fiscal Year: A twelve-month period used for accounting purposes and calculating financial statements. Also called a Financial Year or Budget Year.
Fixed Assets: It includes the historical cost of land as well as the net book value of other long-lived physical assets. The net book value is the historical cost of long-lived assets less accumulated depreciation. The value of fixed assets on the balance sheet does not reflect fair market value or the cost of replacement since these assets are not generally intended to be sold. Instead, the accounting is designed to allocate the cost of a long-lived asset over its useful life. In general, the value of fixed assets is reduced each year by recording a non-cash depreciation expense. Often the value of the asset drops according to a straight-line method that reduces the value in equally sized increments over the estimated useful life of the asset.
Focused Funders: A grantmaking organization created by people who are connected not just by location, but by shared experience and culture, such as race, ethnicity, gender, or sexual orientation. Also called an Identity Fund or Focus Fund.
Foreign Corporation: Any corporation, whether for profit or not, that is organized in one state and does business in another.
Form 990/Form 990-PF: The IRS forms filed annually by public charities and private foundations, respectively. The letters PF stand for private foundation. The IRS uses this form to assess compliance with the Internal Revenue Code. Both forms list organization assets, receipts, expenditures, names of board members, and compensation of officers and grants. Form 990-PF includes a list of grants made during the year by private foundations. These forms are available for public inspection.
Form 990-T: A financial form for organizations who must pay unrelated business income tax.
Form 1023: An application form for nonprofits that want to be recognized as a 501(c)(3) organization.
Form 1024: An application form for nonprofits that seek tax-exempt recognition as any other type of 501(c) than a 501(c)(3) organization.
Foundation: A tax-exempt, nonprofit organization created from designated funds from which the income is distributed as grants to not-for-profit organizations and operate under more stringent IRS regulations than 501(c)(3) organizations. Grants are issued for educational, charitable, social, religious or other activities serving the common good.
Foundation Management: Comprehensive services such as interface with grant seekers, grant management, governing board and committee support, and office administration.
Functional Expenses: Categories of expense delineated by the type of expense: program services, management & general, and fundraising. Required for IRS form 990 and audited financial statements. Often reflect the use of allocations.
Fund Accounting: Method of accounting whereby asset, liability and net asset accounts are grouped according to purpose and/or restriction. Generally used by government entities and not-for-profit organizations. Each fund is a self-balancing set of accounts.
Fund Development: Fundraising strategy, campaign planning and prospect research for public, community and other foundations that raise funds for grantmaking and programs.
Funder: A donor, corporation, community foundation, etc. that provides a grant to a nonprofit organization for projects and/or programs.
Funder Collaboratives: Ad hoc or ongoing multi-funder efforts to develop strategy and coordinate or pool giving to address a particular issue.
Funding Cycle: A chronological pattern of proposal review, decision-making and applicant notification. Some donor organizations make grants at set intervals (quarterly, semi-annually, etc.), while others operate under an annual cycle.
Fundraiser: A fundraiser is someone who makes a living working as a member of an organization’s or institution’s development department, as an independent fundraising consultant, or as a member of a fundraising counseling firm. A volunteer who raises funds for a cause is also referred to as a fundraiser. In addition, a fundraising event has come to be known as a fundraiser.
Fundraising: Soliciting money to benefit a cause or organization.
Fundraising Event: A form of fundraising which involves the organization and staging of a special event for charitable purposes; all proceeds above expenses are designated as a contribution to the charitable institution concerned.
Fundraising Expenses: Include publicizing and conducting fundraising campaigns maintaining donor mailing lists, conducting fundraising events, preparing and distributing fundraising materials and other activities involved in soliciting contributions or memberships.
Fundraising Plan: A fundraising plan encompasses all the elements comprised by an organization’s procedure for attaining a campaign goal. The plan may include a fundraising program, objectives, case, leadership requirements, timetable, personnel requirements, and budget, as well as the overall strategy or grand design for successful implementation of a campaign.
Funds with Donor Restrictions: Funds with donor-imposed restrictions that can be satisfied by the passage of a defined period or by performing defined activities. These funds may be invested to produce a stream of income that can be spent. Formerly Permanently or Temporarily Restricted Funds. See Endowment.
Funds without Donor Restrictions: Contributions given without the donor placing any restrictions or limitations as to their use. Formerly Unrestricted Funds.