Notes to Financial Statements

As of June 30, 1998

NOTE 1: Endowment and Similar Funds

The major portion of the University's endowment and similar funds is maintained in a single investment pool named the University Pooled Endowment Fund. The University has adopted an investment objective whereby the average annual return of the University Pooled Endowment Fund over rolling five-year periods should equal the rate of infiation (measured by the Consumer Price Index) plus its average level of spending from endowment income. The annual return for the Pooled Endowment Fund was 14.3 percent in 1998 and 17.3 percent in 1997. These percentages have been computed using realized and unrealized gains and losses and investment income. The rate of infiation plus the average level of spending from endowment income was 6.4 percent in 1998 and 7.3 percent in 1997. 

The Pooled Endowment Fund is pooled using a market value basis, with each individual fund subscribing to or disposing of units (permanent shares) on the basis of the market value per unit at the beginning of the calendar month within which the transaction takes place. A summary of endowment and similar funds at market value follows:

Endowment and Similar Funds as of June 30, 1998 (in thousands)

Pooled Endowment Fund

Separately Invested Funds

Total

Mutual and Money Market Funds

$ 112,662

$ 9,821

$ 122,483

Repurchase Agreements -

--

232,327

232,327

U.S. Government Securities

186,122

3,090

189,212

Corporate and Municipal Bonds

21,041

1,471

22,512

Corporate Notes

4,031

15,690

19,721

International Bonds and Notes -

16,965

16,965

Common and Preferred Stock

441,268

15,117

456,385

Advances to Foundations (Note 3c) -

45,596

45,596

Real Estate and Other Tangible Property -

1,280

1,280

Mortgages -

5,721

5,721

Other Intangible Property -

286,198

286,198

Total Assets

$ 1,074,008

$ 324,392

$ 1,398,400

Investment Income

$ 24,703

$ 5,424

$ 30,127

Realized Net Gain

102,628

1,532

104,160

Unrealized Net Gain

2,448

1,446

3,894

Pooled Endowment Fund

Number of Permanent Shares

690,142

Number of Participating Shares

691,217

Market Value Per Share

$ 1,528.24

Earnings Per Share

$ 36.85

Distribution Per Share -- Class A

$ 53.94

Distribution Per Share -- Class B

$ 73.99

Endowment and Similar Funds as of June 30, 1997 (in thousands)

Pooled Endowment Fund

Separately Invested Funds

Total

Mutual and Money Market Funds

$ 118,869

$ 7,346

$ 126,215

Repurchase Agreements

236,451

236,451

U.S. Government Securities

134,911

2,905

137,816

Corporate and Municipal Bonds

22,131

1,483

23,614

Corporate Notes

18,475 -

18,475

International Bonds and Notes

18,501

18,501

Common and Preferred Stock

532,247

12,883

545,130

Advances to Foundations (Note 3c)

--

37,389

37,389

Real Estate and Other Tangible Property

--

1,287

1,287

Mortgages

8,404

--

8,404

Other Intangible Property

82,287

--

82,287

Total Assets

$ 935,825

$ 299,744

$ 1,235,569

Investment Income

$ 22,839

$ 4,139

$ 26,978

Realized Net Gain

48,905

1,041

49,946

Unrealized Net Gain

62,469

3,460

65,929

Pooled Endowment Fund

Number of Permanent Shares

672,202

Number of Participating Shares

665,336

Market Value Per Share

$ 1,372.98

Earnings Per Share

$ 39.22

Distribution Per Share -- Class A

$ 51.16

Distribution Per Share -- Class B

$ 69.24


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Financial Report

Notes