corpus

Reviewed by Vishnava | Updated on May 18, 2022

Catalogue

Introduction to Corpus

  • Corpus is described as the total money invested in a particular scheme by all investors. For example, if there are 100 units in an equity fund. Each unit is worth Rs 10.
  • The total corpus of the fund will be Rs 1,000. If a couple of new investors invest another Rs 300 in the fund, the corpus will rise to Rs 1,300.

Understanding Corpus

  • Corpus funds are usually created out of corpus donation. A donation will be treated as a corpus donation only if followed by a specific written direction of the donor. In the absence of a written direction of the donor, a contribution or grant cannot be transferred. Still, the corpus fund is a closed fund with no strings or restriction for future application attached for all practical purposes.
  • It is essential to know that the funds are restricted in a corpus fund, but the purposes are not limited. Corpus fund is an unrestricted permanent fund. The limitation is on the use itself rather than the type of use. A corpus fund can be used in rare circumstances where the survival of the NGO is at threat. Such decisions are seldom taken and should be taken at general meetings. There is no legal bar on the application of corpus funds for charitable purposes.

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