Fundriver has enhanced Spending functionality! The new Spending Interface provides for greater transparency and allows users to be more self-sufficient. Some examples include having the ability to enter your spending allocation date, underwater parameters, averaging based on fixed periods and auto reinvestment for spending thresholds not met field. With the old Spending Interface, users would have to ask for support to make these types of changes.
This article explains the differences between the old and new Spending Interface, as well as highlighting the changes to be aware of when you upgrade to the new Spending Interface.
But first, how do you know if you have the old or new Spending Interface?
The first indication that you have the NEW Spending Interface turned on, is the ASSIGN SECONDARY RULES tab on the SPENDING RULES page:
Additionally, the new Spending Interface has a PARAMETERS WITHDRAWAL and UNDERWATER section under the SPENDING RULES tab:
The OLD Spending Interface does not have the ASSIGN SECONDARY RULES tab:
The OLD Spending Interface only has a single PARAMETERS section under the SPENDING RULES tab:
New Spending Interface Overview- see this article highlights the new functionality!
The significant changes between the old and new Spending Interfaces are as follows:
Users have the ability to change posting frequency and allocation date. Posting frequency allows you to set your parameters based upon how frequently you record spending distributions, i.e., monthly, quarterly, annually.
With the new parameters, the most important thing to remember is that the amount entered in the ‘% to Distribute’ field (under SPENDING CALCULATION) is the ANNUAL percentage. Fundriver uses the posting frequency to calculate spending. In the old Spending Interface, the amount, or percent to distribute had to be changed to align with posting frequency each time distributions were posted. Now you only have to update that field once per fiscal year.
NEW Spending Interface:
OLD Spending Interface:
The allocation date, also known as valuation date, is used to calculate your spending draw, and is used to determine the average value component of your spending calculation. The allocation date is set up on the Spending Rule screen. The allocation date field determines how spending is calculated on the new Estimated Spending Report (with Column Groupings and Drill Down).
This report is part of the new Spending Interface and shows your estimated gross distribution, reinvestments, and net distribution. The report will show both your annual distribution as well as your withdrawal frequency. Withdrawal frequency is used in situations where users post more than once a year (i.e. monthly, quarterly). This report can be found by navigating to REPORT > SPENDING:
The Post Date drives the Market Value and Historical Gift values, while the Allocation Date in the spending rule drives the calculations:
The drill down functionality is the most exciting part of the report. By clicking on any blue number, a new report will open to display how Fundriver is calculating the spending. This is very handy when your auditors are asking lots of questions!
In contrast, the old Estimated Spending Report works much differently. The spending allocation date was used as the report Post Date when running the report. Clients will not have to worry about using the Allocation Date as the post date when running the report in the new interface.
Another difference between the old and new Spending Interface is on the DISTRIBUTE screen. The old Spending Interface did not include the ‘Select Spending Rule’ drop down, so you had to process all spending rules at once.
OLD Spending Interface:
Within the new Spending Interface, users can select which spending rule(s) they wish to process. This makes things a lot easier if you have multiple spending rules, spending rules with different allocation dates, spending rules that post with differing frequency, i.e., one rule quarterly, another rule annually.
NEW Spending Interface:
