Some Canadian foundations may be challenging affairs to operate. Private groups, for example, have paid staff, an established office, and constant communications with donors and beneficiaries. Naturally, there will be certain issues that may complicate matters of operations to the point that the foundation is forced to close down, especially if not properly managed. What if there’s still a need to continue what the group started, though? The foundation can do so by converting it to a donor-assisted fund (DAF).
The first step in setting up a DAF will be to contact a foundation hosting service to facilitate the process, converting existing assets into the account. A fund deed will be the key to the effort. The process also includes listing down the potential charities to be linked to your donations.
A DAF planned through your foundation advisor helps in defining the long-term goals of your philanthropic work. Some DAF providers give you the leeway to change charities at discretion. This may be true especially when certain factors have dearly affected the beneficiary, such as mismanagement of gifts or the collapse of the organization itself. In a number of cases, the awarding of grants under the DAF may have some preconditions that must be strictly met.