Abundance Canada Disbursement Policy

1. Purpose

This policy explains how Abundance Canada reviews, approves, and processes charitable disbursements from funds held by the Foundation.

Abundance Canada is committed to helping donors support charitable causes while ensuring all disbursements comply with applicable laws, Canada Revenue Agency requirements, and Foundation policies.

This policy applies to all disbursements made by the Foundation and should be read in conjunction with the applicable Fund Agreement, Fee Model Policy, Investment Policy, Gift Acceptance Policy, and Reserve Fund Policy.

2. Governance and Compliance

The Board of Directors approves this policy and reviews it periodically.

Disbursements must be made in accordance with:

• applicable laws and regulations;
• CRA requirements;
• Foundation policies;
• the applicable Fund Agreement.

The Foundation retains full discretion over all disbursements.

3. Definitions

Binding Recommendations: (AKA Restrictions) Written Fundholder-imposed instructions, which are made at the time of the gift, that may jeopardize the charitable status of the Foundation, cause undue burden or harm to the Foundation’s operations, or disqualify the gift from receiving a charitable tax receipt.

Designated Representative: An individual(s) authorized by the Fundholder, in writing (e.g., a Designated Representative form or email confirmed by staff), to make Non-Binding Recommendations of disbursement from the Foundation on the Fundholder’s behalf. The Foundation is under no obligation to verify the validity of the Designated Person(s) recommendation with the Fundholder before making the distribution once the authorization has been made.

Disbursement: Grants made by the Foundation from a DAF to a qualified donee.

Donor-Advised Fund (DAF): A charitable fund where the Fundholder or Designated Representative may make non-binding recommendations regarding future disbursements.

Foundation: A registered charity designated by the Canada Revenue Agency as a public foundation.

Fundholder: The individual, family, organization, or group that has established a DAF  within the Foundation for charitable giving purposes.

Non-Binding Recommendation: A written request by a Fundholder or a Designated Representative asking the Foundation to consider a disbursement.

Private Foundation: A registered charity designated by the Canada Revenue Agency as a private foundation, as defined under the Income Tax Act (Canada).

Qualified Donee: Holds the meaning as defined in the Income Tax Act of Canada s. 149.1 and is an organization authorized by the CRA to issue official donation receipts and receive gifts from registered charities. Typically, a qualified donee performs the charitable activity that is directly benefiting the community.

Examples (not a complete list): registered charities, registered Canadian municipalities, and registered national arts service organizations. Note that disbursements to foundations are subject to additional requirements – see Clause 7.

DONOR-ADVISED FUND (DAF) TYPES

Flowthrough DAF: Designed for immediate community impact. Funds are not invested.

Responsive DAF: Supports community initiatives as they arise and/or over several years. Funds are invested.

Sustainable DAF: Designed to generate ongoing income to support community over the long-term (minimum 10 years). Funds are invested.

4. Disbursement Principles

All disbursements are guided by the following principles:

• Compliance with applicable laws and CRA requirements.
• Responsible stewardship of charitable assets.
• Fair and consistent decision-making.
• Respect for donor intent where consistent with applicable requirements.
• Support for charitable impact in communities.

5. Disbursement Recommendations

5.1 Non-Binding Recommendations

Fundholders may make non-binding recommendations regarding disbursements from their Fund. All recommendations are advisory only, and the Foundation retains full discretion and decision-making authority regarding every disbursement to ensure compliance with applicable laws, CRA requirements, Foundation policies, and the applicable Fund Agreement. Any agreement with a donor that governs the direction of where funds will be disbursed is improper and will not be accepted.

5.2 Making a Recommendation

Fundholders and their Designated Representatives may recommend a disbursement by submitting a written recommendation to the Foundation.

Recommendations received verbally (including by telephone or in person) will be confirmed in writing before processing.

A Designated Representative may make recommendations on behalf of a Fundholder in accordance with the authorization on file with the Foundation. The Foundation is under no obligation to verify with the Fundholder the instructions of a Designated Representative before making the disbursement.

Refer to Appendix A for the information required when submitting a recommendation.

5.3 Review of Recommendations

The Foundation will make reasonable efforts to approve recommendations that comply with:

• this Policy;
• the applicable Fund Agreement;
• CRA requirements; and
• applicable laws.

The Foundation reserves the right to decline any recommendation.

Where a recommendation is declined, the Foundation will provide written notice to the Fundholder or Designated Representative outlining the reason for the decision.

If an alternative eligible recipient cannot be identified, the remaining Fund balance will continue to be administered in accordance with the applicable Fund Agreement and Section 9 (Non-Direction Clause).

5.4 Recommendations Declined

Recommendations may be declined if

• the proposed recipient is not eligible to receive funding under applicable laws or CRA requirements;
• the proposed use of funds would violate applicable laws;
• the recommendation would create an undue private benefit;
• the recommendation conflicts with the applicable Fund Agreement; or
• the Foundation determines the recommendation would expose the Foundation to undue legal, regulatory, financial, or reputational risk.

6. Disbursements

Disbursement recommendations may be made from any Fund Type, subject to this policy, the applicable Fund Agreement, available fund balance, and the Foundation's review and approval process.

All Fund Types

• Individual disbursement recommendations must have a minimum value of $250.
• Fundholders and Designated Representatives are encouraged to use disbursement recommendations strategically to maximize charitable impact and support the efficient administration of the Foundation.
• The Foundation may discuss the timing, frequency, or structure of recommendations with a Fundholder or Designated Representative where appropriate.

Flowthrough DAF

A Flowthrough DAF is intended for immediate or near-term charitable impact. Because funds are not invested, disbursement recommendations are generally dependent on the available cash balance of the fund.

Responsive DAF

A Responsive DAF is intended to support ongoing charitable giving as needs and opportunities arise. Because funds are invested, disbursement recommendations are dependent on the available fund balance and the liquidity of the applicable investment vehicle.

Sustainable DAF

The Fundholder or Designated Representative may submit non-binding recommendations for disbursements of the total net income derived from this fund’s investment (up to 5%, a value set by Abundance Canada and subject to change) or up to the Disbursement Quota set by the Canada Revenue Agency (currently set at 5% of the fund’s fair market value), each year for the length of the agreement.

Donor Advised Funds + External Advisor/Financial Entity (DAF+EA/FE)

A DAF+ EA must hold a minimum value of $250,000 before submitting any disbursement recommendations. The DAF+ FE must maintain a $250,000 minimum total portfolio balance for individual donor funds to disburse.

Individual DAF+ EA/FE funds can make up to four (4) transfers per year from their external fund to their Abundance Canada DAF. Funds that have set automatic transfers between the provider and the Foundation in their fund agreement are exempt from this transfer limit.

The Abundance Canada DAF to which the funds are transferred is subject to the Abundance Canada Disbursement Policy.

Charity Partnership Fund (CPF)

A Charity Partnership Fund (CPF) is designed to provide long-term support to a charitable organization through a permanently invested fund administered by the Foundation. The Foundation will invest CPF assets in accordance with its Investment Policy with the objective of providing sustainable annual support to the Charity over time.

Annual Sustainable Disbursement

Subject to applicable laws and CRA requirements, the Charity will generally be eligible to receive an Annual Sustainable Disbursement each year.

The Annual Sustainable Disbursement will generally be based on the CRA disbursement quota applicable to charitable foundations (currently 5%) and will be calculated in accordance with Foundation policies and procedures.

The Foundation may adjust the calculation methodology where required to comply with legislative, regulatory, accounting, or policy changes.

The value of the Annual Sustainable Disbursement will generally be provided to the Fundholder during the first quarter of each Foundation fiscal year.

Additional Disbursements

In addition to the Annual Sustainable Disbursement, the Charity may request an Additional Disbursement from the CPF.

Requests for Additional Disbursements must:

• be submitted in writing;
• be authorized through a resolution of the Charity's Board of Directors; and
• comply with this Policy and any applicable Fund Agreement.

The Foundation will review Additional Disbursement requests in accordance with its standard review and approval processes.

7. Approvals

Review of Recommendations

All disbursement recommendations are subject to review by the Foundation before funds are released.

As part of the review process, the Foundation may verify:

• the eligibility of the proposed recipient;
• the charitable purpose of the proposed disbursement;
• the availability of funds;
• compliance with CRA requirements;
• compliance with Foundation policies; and
• any additional information reasonably required to assess the recommendation.

The Foundation may request additional information before making a decision on a recommendation.

Approval Authority

Disbursement recommendations must receive written approval from the appropriate Foundation staff member responsible for the Fund.

Verbal approvals are not permitted. Electronic approvals are considered written approvals.

The Foundation reserves the right to escalate any recommendation for further review based on complexity, risk, value, recipient type, or policy considerations.

Disbursements to Foundations

Disbursement recommendations to public foundations from Responsive DAFs and Sustainable DAFs are limited to 20% of the fund value in any fiscal year unless additional approval is obtained. Disbursement recommendations to public foundations from Flowthrough DAFs can be of any amount.

Transaction	Approval Required
Public Foundation up to 20% of fund value	CEO
Public Foundation greater than 20% of fund value	Board of Directors

Disbursements to Private Foundations

Disbursements to private foundations are limited to disbursements through Flowthrough DAFs only and may be of any amount.

Release of Funds

Approved disbursements will be processed in accordance with the Foundation's Delegation of Authority Policy and applicable financial controls.

8. Timing

Fundholders should generally expect 20 business days for the review, approval, and processing of each written non-binding recommendation for disbursement(s). Once a non-binding recommendation is received, the Foundation will disburse funds to the designated registered charity within this timeframe. If the process requires additional time, fundholders will be notified along with the reason for the delay.

9. Non-Direction Clause:

If, for a period of twenty-four consecutive months, the Foundation receives no direction, recommendation, or communication from the Fundholder or Representative (s) regarding the use or disbursement of a Fund (excluding endowment funds), the Foundation may, at its sole discretion, and in accordance with its charitable purposes and applicable laws and regulations, direct the income and/or capital of the Fund to support charitable activities of qualified donees including those of the Foundation.

The Foundation will make reasonable efforts to contact the Fundholder or Designated Representative prior to exercising this discretion. However, if such efforts are unsuccessful, the Foundation shall not be liable for acting in accordance with this clause, provided such actions are consistent with the Foundation’s mission and / or the charitable purposes of the Fund as originally intended, if known and still eligible to receive funding from the Foundation.

10. Disbursement Quota

The Foundation complies with CRA disbursement quota requirements and other applicable regulatory obligations. The Board monitors compliance through regular financial oversight and reporting.

11. Adoption and Effective Date

The policy supersedes any previous disbursement policies.

12. Review and Amendment of Policy

This policy will be reviewed by the appropriate Board committee(s) at least every five years, or sooner if required by changes in law, regulation, or organizational structure.

The Board must explicitly approve any exceptions to this policy.

Related Policies

Gift Acceptance Policy, Investment Policy, DAF Agreement Template, DAF+ EA/FE Agreement Template, CPF Agreement Template