Term endowment funds are similar to true (permanent) endowments, except that, upon the passage of a stated period (or time) or the occurrence of a particular event, all or part of the donation may be expended. True and term endowments are collectively referred to as ‘donor restricted’ transactions.
Source: NACUBO Accounting Tutorial – Endowment Definitions
- Generally not as common as true and quasi endowments.
- Created by donor intent – evidenced by gift agreement or bequest