§ 30-2-12-14 — Duties of person or institution managing or investing institutional fund

Indiana § 30-2-12-14

• Jurisdiction: Indiana
• Art. 2: GENERAL PROVISIONS
• Ch. 12: Uniform Management of Institutional Funds Act

Text

(a) An institution that manages or invests an
institutional fund shall consider the following:
(1) The intent of a donor expressed in a gift instrument.
(2) The charitable purposes of the institution.
(3) The purposes of the institutional fund.
(b) A person who is responsible for managing or investing an
institutional fund shall:
(1) comply with the duty of loyalty imposed by any law; and
(2) manage or invest the fund in good faith and with the care a
prudent person acting in a like position would use under similar
circumstances.
(c) An institution that manages or invests an institutional fund:
(1) may only incur costs that are appropriate and reasonable in
relation to:
(A) the assets of;
(B) the purposes of; and
(C) the skills available to;
the institution; and
(2) shall make a reasonable effort to verify facts relevant to the
management and investment of the fund.
(d) An institution may pool two (2) or more institutional funds for
purposes of management or investment.
(e) Subject to the terms of a gift instrument, an institution or a
person shall do the following:
(1) An institution that manages or invests an institutional fund
shall consider the following factors:
(A) General economic conditions.
(B) The possible effects of inflation or deflation.
(C) The possible tax consequences of investment decisions or
strategies.
(D) The role of each investment or course of action in relation
to the overall investment portfolio of the institutional fund.
(E) The expected total return from income and the appreciation
of investments.
(F) Other resources of the institution.
(G) The needs of the institution and institutional fund to make
distributions and to preserve capital.
(H) The relationship or value of an asset to the charitable
purposes of the institution.
(2) An institution shall make management and investment
decisions about an individual asset:
(A) in the context of an institutional fund's portfolio of
investments as a whole and not in isolation; and
(B) as part of an overall investment strategy that has risk and
return objectives reasonably suited to the institutional fund and
to the institution.
(3) Except as otherwise provided in law, an institution may invest
in any kind of property or type of investment.
(4) An institution shall diversify the investments of an
institutional fund unless the institution reasonably determines
that, due to special circumstances, the purposes of the
institutional fund are better served without diversification.
(5) Within a reasonable time after receiving property, an
institution shall:
(A) retain or dispose of the property; or
(B) otherwise rebalance the investment portfolio;
to bring the institutional fund into compliance with the purposes,
terms, and distribution requirements of the institution.
(6) A person that has, or represents to have, special skills or
expertise shall use the skills or expertise to manage or invest
institutional funds.
(7) Notwithstanding any other provision in this chapter, an
institution may retain property contributed by a donor to an
institutional fund as long as the governing board of the institution
considers it advisable.

Legislative History

As added by P.L.226-2007, SEC.17.