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The Islamic Center of Irving (ICI) is pleased to announce the establishment of the ICI Endowment Fund. The sole objective of the Endowment Fund will be to provide financial stability to ICI’s diverse activities. The Shura Council has appointed a fund steering committee. The committee will work to set up the fund infrastructure and identify Islamically acceptable investment options in close consultation with the Shura Council. |
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| ICI Endowment Fund FAQs |
| What is the purpose of an endowment fund? |
| How does the Endowment Fund operate? |
| What kind of donations are acceptable? What programs will the fund support? |
| Can the money invested in the Endowment Fund be recovered? |
| How can I contribute? Is this Sadaqah Jaariyah ? |
| Will donor intent be honored? Can money donated for one purpose be utilized for a different purpose? |
| Can the endowment accept Zakaah money? |
| How are investments selected? |
| Is the endowment fund safe? Can the money be lost? |
| Can organizations outside of ICI participate to the endowment fund? |
| How are the committee members appointed? What are its duties? |
| Will my donations be tax deductible? |
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Q. What is the purpose of an endowment fund? How is it different from normal cash assets? A. Endowment funds and foundations are very common with institutions. Their main purpose is to provide financial stability and security to the institution. |
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A. noteworthy feature is that the amount donated (i.e. principal) is not spent or consumed. Only the profits from the investment made with that money are used. This means that donations made to the endowment will continue to serve their purpose in perpetuity. This is not the case with regular cash funds that can be utilized for their purpose and therefore exhausted soon. This concept is similar to a "waqf" or "trust" that many of us may be familiar with. |
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Q. How does the Endowment Fund operate? |
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A. Put simply, by strength in numbers. Various divisions in the organization have separate budgets that are controlled in individual operation accounts. The endowment concept allows pooling of all these resources into one or many investment vehicles for profit. The ratio of the profit distribution is proportional to the ratio of investments. This ensures that all monies invested are utilized for the purpose intended. |
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Q. What kind of donations are acceptable? What programs will the fund support? |
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A. The endowment fund can accept a variety of donations, Sadaqah, bequeathments of inheritances, non-cash donations, corporate matching funds. This model is ideal for setting up special initiatives like grants, scholarships, seed money, etc. |
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Q. Can the money invested in the Endowment Fund be recovered? |
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A. In general, no. Unless noted in restrictions associated with the donation, funds flowing into an foundation or endowment are not intended to be utilized other than as investments to accumulate over time and serve the original purpose. This will ensure long term stability of the organization against economic trends. |
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Q. How can I contribute? Is this Sadaqah Jaariyah? |
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A. Insha Allah, yes. By its very nature, the endowment fund is designed to stretch each dollar to its fullest potential. As explained previously, funds are held in perpetuity (unless specified otherwise by the donor) and the principal is never utilized, only the profits from the investment. This ensures that your donation continues to work for you and support your chosen cause for as long as the endowment is in existence. |
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Q. Will donor intent be honored? Can money donated for one purpose be utilized for a different purpose? |
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A. Donor intent is central to the concept of an endowment. The endowment fund has buckets organized by area. It is therefore possible to make sure money donated for one cause is indeed allocated for that cause. |
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Q. Can the endowment accept Zakaah money? |
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A. Zakaah funds must be spent as soon as possible and therefore is not eligible for the endowment. Any donations made with the intention of Zakaah will be redirected to the ICI Zakaah fund to provide immediate relief to needy families. |
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Q. How are investments selected? |
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A. Funds are invested in Sharia compliant investment vehicles. Profits are re-invested. After the recommended waiting period, a part of the profits will be made available to the associated program as needed. There will be restrictions on investments. The fund may not invest in non-Islamic sectors like Financial, Entertainment, etc. Risky investments will be avoided. The investment options will be carefully selected and refined from time to time by the fund committee. |
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Q. Is the endowment fund safe? Can the money be lost? |
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A. As with any investment, risk associated with market fluctuations and economic conditions must be considered. Funds will be invested in safe, long term investment vehicles, and care will be taken as far as possible to ensure that long term growth is achieved through dollar-cost averaging. |
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Q. Can organizations outside of ICI participate to the endowment fund? |
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A. While anyone can donate, the endowment fund is set up primarily to support the Islamic Center of Irving and its subsidiaries. |
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Q. How are the committee members appointed? What are its duties? |
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A. Committee members have been appointed by the Shura Council of ICI. The fund committee has been tasked with setting up of the fund investment accounts and initiating investment activity. The fund committee is also charged with fundraising and community awareness. Once the fund balance reaches a minimum threshold, the fund committee will make recommendations on how to establish and operate the endowment fund as a separate entity. |
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Q. Will my donations be tax deductible? |
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A. The fund will operate under a 501(c)3 status, and there fore all donations are eligible for tax deductions. |
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