Sample Test Flashcards

Question

Financial Skills based trusts are concerned which of the following provisions I Incentive based provisions II Basic Financial Skills provisions A) I only B) II only C) Both I and II D) Neither I nor II

Answer 1

B) II only B) Skills as the name would imply.

Answer 2

C) Both I and II The correct answer is C. Both are true. Peter is a role model for CAPs in that he understands the importance of both "heart" and "head." He was one of the first to call for "strategic philanthropy," and he does expect givers to get results, but he also calls for philanthropy to be like poetry: heartfelt, impassioned, creative.

Answer 3

A) Downloading The correct answer is A. When we listen in downloading mode, we are saying, internally, "Yes, of course. Nothing new here." Factual listening leads to our saying, "I see, new information here." Empathetic listening is listening to enter into the feelings, mood, or mindset of the other. In generative listening, something utterly new emerges as if out of the space between client and advisor. Out of the silence comes for the client a new insight, self-generated, that would not have been possible without the active attention of the advisor. That is what the Fithians, following Schervish (who himself was following the meditation exercises recommended by St. Ignatius Loyola) call discernment. In discernment, it is as if the one discerning hears a voice, an inner teacher, as Parker Palmer calls it. Inspiration is Tracy Gary's way of saying it.

Answer 4

C) Both I and II The correct answer is C. Both are true. The question helps you tell the CAP story. There is real love and passion behind our credential. Bill was in his eighties when he studied and earned his designation, as you will. It was a proud moment when Bill, who served for decades on the College's Board, and who had chaired the Board, stood before his peers and was pinned by Sallie with a symbol that means craft and love. We are fortunate to have a symbol with a story that is true, inspiring, and heartfelt.

Answer 5

B) Law A) Law. Bar canons prohibit representing potentially adverse parties. Forms can be signed to mitigate this with a loving couple, but very difficult to mitigate it with an entire complex family system spanning generations. This has led Jay Hughes to give up the practice of law.

Answer 6

A) A grant to build infrastructure, staff, and systems to enable a nonprofit to do its work The correct answer is A. A capacity grant is contrasted with a grant for programs. A capacity grant is like an investment in the capacity of the charity to operate at all. It is sometimes disparaged as being a gift to cover overhead, but it is best seen as an investment needed to keep the organization going, a grant that creates the capacity to carry out programs which, in turn, might be funded by program grants.

Answer 7

II. The private foundation The correct answer is B. This is the power and the paradox of private foundations. They let private money work towards what the foundation deems to be the public good, within very broad limits. The general public does not get a vote. If you look back at the history of private foundations, this paradox was much debated when the enabling legislation was passed enabling them in the days of Carnegie, Rockefeller, and Ford. Some legislators feared the creation of very wealthy foundations that could have a significant impact on the country and the world while not being accountable to the public. These same concerns are now being raised by books like Winners Take All and The Givers. Recognizing the possibility that concentrated philanthropic power can work in ways contrary to public purposes, this course cites the wisest of remarks by H. Peter Karoff: "No good deed goes unpunished." Rather than complaining about what a particular foundation has done or failed to do, he might well ask, "So what about you? What are you doing in your own giving? Your own volunteering? Your own community building? Your own board service?"

Answer 8

II. Leanne, at 41, has risen to be President and CEO of a Fortune 100 company. One day, going up in the executive elevator, floor after floor, she panics, wondering what she has done with her life. The correct answer is B. Success panic for Bob means panicking when you realize that the success you spent your life achieving was not worth the price paid for it. "I am successful, as the world measures success, so what? What have I done with my life?" As advisors we help our clients be successful...... What about those who are like Bob or the woman in the elevator? What can we do for them?

Answer 9

D) Project Manager D) In the absence of a project manager, the team may never decide who will do what when. Without a project manager things don't get done, or don't get done in the right order. This is hard because the players on the team do not work for each other and do not work under a common employer. Who then will step in and manage the team?

Answer 10

B) Achieving great financial success and then, in mid-life, being overwhelmed by the sense that he had become enslaved to "the thrill of the kill" and "the art of the deal." The correct answer is B. Half Time, as the title implies, is the book of a man who has undergone a mid-life crisis, one that was like a new birth, "from success to significance."

Answer 11

B) II only The correct answer is B. Grassroots philanthropy differs from strategic philanthropy in certain key respects. In the grassroots model, the funder is actively and personally involved in meeting face-to-face with grant recipients and makes decisions quickly, relying on the charity and its leadership to make good use of the money. This is "philanthropy by walking around." Grassroots philanthropy does not want to impose the funder's methods on the charity. It does not want to tie the charity up in paperwork. It is often small-scale, local, and neighborly. In contrast, strategic philanthropy fits well with large foundations, making significant grants, competitively, at a distance from the recipient, relying on well reasoned grant requests, a theory of change, and ongoing reports as to results.

Answer 12

C) Both I and II The correct answer is C. A gift planner working for a nonprofit may not get "all the facts," but working with advisors they can participate in a process in which all the relevant facts and goals are elicited and addressed in a balanced and effective way.

Answer 13

C) Both I and II The correct answer is C. Both are true. At times, the most trusted advisor may simply be present, at the client's side, with the planning team at the table. At other times, however, the most trusted advisor shields the client from direct access to the other advisors, acting as gatekeeper. The Most Trusted Advisor may meet with the team, or with sub-teams, in order to pull the plan together for the client's consideration. This process can save the client time and can work to create a unified plan. But clearly only a highly trusted advisor can be trusted to act like this, almost like the client's proxy, or chief of staff, in pulling all the pieces together for the client's ultimate consideration and approval.

Answer 14

D) What must be done today to make this a successful meeting from your perspective? The correct answer is D. Clearly, only the last begins with what the client has in mind. All the others start with what the professional wants, needs, or hopes to accomplish. The other three are like gambits, or bait. The donor or client may feel as if they are being set up, processed, handled, sold, or even used. Such processes are proven to work - up to a point. But trust is low. Trust requires that the client or donor feel that the professional is oriented to them, not to the professional's own agenda. This can be very difficult for a professional to do, given how the professional is hired, trained, and incentivised. For some organizations, discernment or even consulting is considered the long way around and to be discouraged. Discernment-style interviews sometimes feel like an act of subversion. We are stepping, as human beings, out of our roles as butcher, baker, candlestick maker, attorney, CPA, investment advisor, insurance agent, or gift-planner, and treating the other as an end in himself or herself. That, too, can pay off, but it runs the risk of taking too long, getting off track, or even becoming a sales gambit in its own right. The expert-consultative style strikes a middle ground. We extend ourselves towards the donor or client, with a good open question, but also with one foot clearly planted in our own professional role.

Answer 15

II. Violence in the Middle East The correct answer is B. A "wicked problem" is one that results from so many interconnected factors that it is very difficult to decide how best to "cure" the problem. Global poverty, climate change, terrorism, wars in the Middle East, the drug trade, are examples. Other problems, like malaria, are complicated, but have clear solutions, such as malaria nets or a vaccine. Others are relatively simple, like providing shelter for families displaced by a tornado. Others are complex, with many factors, but like a knot that could be untied. Teenage pregnancy might be an example. The point of calling a problem "wicked" is to draw attention to just how hard it is even to know where to begin. Whatever we attempt may produce unforeseen consequences that could make the problem worse.

Answer 16

D) Neither I nor II The correct answer is D. Neither suits her preferences. She does not want to invest in the general overhead or upkeep of the organization. She wants her dollars earmarked for particular programs and projects.

Answer 17

A) Sales The correct answer is A. The point being made is that sales is all about not only selling commodities but becoming a commodity yourself. Sales and, increasingly, expertise and advice and planning are becoming commodified. That is, every town is full of people who can give expert advice on tax and finance and construct some kind of plan. But how many can listen a client into clarity about the meaning and purpose of the project, the life, the fate of the family, and the community of which it is a part? The last thing to be commodified will be, well, things of the spirit. In that respect, the market advantage may lie with those nonprofits which were formed expressly to cultivate, foster, and preserve these higher forms of life.

Answer 18

A) Become a learner The correct answer is A. Her next step, having decided to get organized, is to become a learner. The steps on the curve, as Peter sees it, from his considerable experience, go like this: 1) Become a donor, 2) Decide to get organized, 3) Become a learner, 4) Become issues- and results-oriented, 5) Leverage the gifts, and 6) Align vision, passion, and interests, so that giving becomes one of the most fulfilling and exciting things you do.

Answer 19

A) I only The correct answer is A. Yes, this is an "honored obligation." What a fine way to say it! It could also be called faithful giving, or checkbook giving, or giving as paying dues. To fundraisers, it is an unrestricted annual gift which is the lifeblood of any organization. From Ellen Remmer's perspective, it is what she calls "responsive philanthropy," or giving when asked. Giving charity, in her language, is giving from the heart spontaneously when touched by a need, like giving a coat to a homeless person or responding to an appeal after a disaster. (To remember this, think "caritas" - love from the heart - is the root word for charity.)

Answer 20

I. Learning to save A) I only A) is correct. As the name implies these trusts encourage good financial skills like saving, managing personal debt, and living within a budget. They do not teach skills like finding a personal passion.

Answer 21

C) Both I and II The correct answer is C. Both statements are true. This is one of several "advisor donor disconnects" documented in the study. Generally, advisors believe that clients are more concerned than they actually are about the financial impact of the gift on the donor and the donor's family. Tax issues, too, loom larger in advisor minds than in the minds of donors. Generally, donors are mainly concerned about whether their gift will be used wisely by the charity; they want to know more about the charities they give to and want to feel more connected to them; and they are concerned that if they give, then they will be solicited again and again.

Answer 22

A) Hero's Journey The correct answer is A. Collier is drawing on figures like Jung and Joseph Campbell. The idea, which, if we are honest, most of us will own up to, is that we see our lives not as mere processions of events but as a narrative of which we are the hero, overcoming obstacles, bouncing back from defeat, reaching new levels of self-understanding, undertaking and completing difficult ordeals, winning likes and followers, becoming stars, going on quests against long odds, winning the damsel, or wedding the prince. The stories we tell ourselves to make sense of our lives change as we grow up, reach maturity, hit the midlife crisis, enter old age, or face the end of our days. We outgrow some delusions and grow into others. We feed our hearts, as Yeats once said, "with fantasy." And, he added, "the heart's grown brutal on the fare." Literature, philosophy, psychology, scripture, history, folklore, political oratory, and now marketing and brands give us the stories by which we form our identities as individuals, families, communities. Many in this course are making similar points. Karoff, a poet, sees philanthropy as partly what he calls (in an article not assigned in this course) "the inner journey." Paul Schervish is quite clear that self-understanding is had through stories of genesis and telesis, or a gospel of wealth, or spiritual autobiography. David Solie emphasizes the "grand retrospective" in which elders look back and attempt to make sense of their lives. When your mind wanders, where does it go, but to a story in which you figure as hero? Yet, in our planning with clients, we pretend that the object of the exercise can be reduced to facts and figures. The currency of the self is story. The getting of money is but one plot line. More than money must hold a family, community, or nation together. That is the story. How does it end?

Answer 23

B) Jill inherited a seat on her family's foundation board. They grant out $1 million a year. The correct answer is B. Most of the clients for CAP advisors and CAP fundraisers are not in need of dedicated grantmaking advice. They need a general orientation that a CAP can provide, or a Community Foundation might provide, but they do not need, nor will they pay for, a complete, fee-based engagement to cover grantmaking alone. That is the turf of firms like Bridgespan and advisors like Tom Tierney. We can learn from Give Smart and other sophisticated books on grantmaking, and can pass them on to those transitioning from "success to significance," but few of us will make our living as dedicated consultants to grantmakers.

Answer 24

D) Neither I nor II The correct answer is D. The Fithians, and the course author, are determined to say that there is no one right way to be successful. Some succeed at sales, some at being experts, and some through discernment. But there are certain mis-matches. To use the discernment style, which can take hours, days, years, with a prospect who has a simple situation and no money is a mismatch. It is a very good way to go broke. On the other hand, to drive a sales style or even an expert style into a complex client situation, where what is most at issue is the very purpose of the engagement, is to force the client to accept a solution before the client even knows what the they are trying to accomplish. Discernment is rare. And it can distinguish the mere expert from a wise counselor or trusted advisor. But those who use this style must make sure the situation is right. Generally, the more complex the situation and the higher the client's capacity to pay fees or generate large transactions, the more sense it makes to adopt the discerning approach. Even then, it may be the sales persons and the experts who make the biggest money. The discerning one may move the case to closure, but it is not a bad idea to position your products and services in the processes so that you are the one who also gets the sale, the planning fees, or the gift.

Answer 25

D) CPA can connect the donor's heart through the plan to the charity's mission and through the charity to impact on a cause that matters to the client The correct answer is D. Clearly, the CPA is less capable of connecting to impact than is the nonprofit person. In general, the advantage that nonprofit gift planners have over the "technicians" and the "experts" is in delivering impact in line with donor intentions, ideals, and passions. Yet, it is also true that many planned giving officers lead with the technical, then, sadly, get sideways with the CPA or other tax expert who feels that the planned giving person is pitching a tool without an objective analysis of how the tool functions in the client's overall financial statements.

Answer 26

D) Meet with tax, legal, and financial advisors to structure the gift The correct answer is D. Renata's due diligence, like the work done by Tom Tierney's staff at Bridgespan, is focused on evaluating the charity in light of the funder's goals. Such due diligence is not focused donor finance. Due diligence, of the kind Renata conducts, is often performed by grant-making entities, particularly foundations, sometimes with paid staff. Sometimes consultants like Renata, Tracy Gary, TPI, or Bridgespan are hired to help the grantmakers make better grants. The focus in this realm is on making the best use of the dollars going from the grantmaker (sometimes a staffed foundation) to the grantee charity. Financial advisors who take CAP are, by contrast, most often working with people who have wealth but who are low on the philanthropic learning curve. They are not yet giving big. They are not yet giving within a purposeful, well considered plan for achieving impact. For the advisors and for these clients, philanthropy is still primarily a category of personal finance, and is all about structuring the gift within the financial, estate, or business exit plan. As clients climb the curve and devote more and more time and money to it, due diligence, systematic charity selection, and getting results become more important. CAP encourages advisors and their clients to think beyond the structure of the gift to its impact, and to see that some thought and due diligence has to go into that, if the money is to be used to best advantage. CAP also encourages gift consultants like Renata, whose focus in on due diligence and charity selection, to recognize that that for many donors, it is only possible to release significant dollars if their finances are properly planned first. Community Foundation CAPs will "get" what Renata recommends, because often Community Foundations conduct such due diligence for the CF's own grants, and also encourage their donor-advised fund holders to do due diligence on the charities they are considering. It can also be said that the trend is towards more and more people, even small givers, at younger ages, to do some due diligence and charity selection, if only by consulting online charity portals like Guidestar and Charity Navigator.

Answer 27

D) Neither I nor II The correct answer is D. Neither is true. A high-level discernment interview or generative dialogue or transformational experience is, in fact, the exception for even the best advisors and gift planners. For the most part, we remain "hired help," solicitors, product providers, or experts. We are there, in the eyes of the client or donor, to get a job done and to provide a transaction. They may or may not even want much of a relationship with us. They may well just want the job done fairly, efficiently, and without undo bother or expense. There is no reason to make it more complicated than that, when all indications point to a quick transaction that we can get done. The discernment approach is played out less often, for higher stakes, with high-capacity clients and donors and can be transformational. But we cannot parlay every opportunity into a life-changing experience and should not try to do so. That is the practical wisdom of Patricia Angus.

Answer 28

A) Simple The correct answer is A. The problem as stated is simple enough: Talia can save one life per dollar spent, through a well understood strategy. Few problems, of course, are really this simple.

Answer 29

B) De Facto The correct answer is B. While this question is framed as something to learn by heart, behind it lies a deep insight, one that is helpful in your career. Yes, successful people have advisory teams. But it is amazing how often those teams were put together with no real thought. One member might be a college buddy; one might be an in-law; one might be a professional met on the golf course. The Fithians are suggesting that the client should have an "intentional team," one put together on purpose. And on that team there will be a "core team" that meets often. Beyond that is the "virtual team," brought together to work on a specific issue, which might include, for example, philanthropy.

Answer 30

C) Both I and II The correct answer is C. Rogers is the ultimate source for much of the best contemporary writing on reflective or generative listening. Scharmer makes similar points. Karoff does as well, coming from the perspective of a poet. Palmer arrives at similar views, drawing on Quaker circles.

Answer 31

C) Both I and II The correct answer is C. Yes, both can say they do philanthropic plans, but their interests and methods differ entirely. One hope of CAP is to integrate these two processes, so that clients and donors experience a more seamless whole.

Answer 32

I. Funders live in a world where no one holds them accountable A) I only The correct answer is A. Voters hold elected officials accountable. Customers hold businesses accountable. Who holds a big foundation accountable? Who holds a wealthy person making a big gift accountable? No one, unless those making the grant or gift hold themselves accountable. In that way, big funders live in a kind of never-never land. The book describes that happy land, a conflict-free zone, "the Galapagos Islands" where the funder is cut off from everyday reality and has no natural predators that will put the funder out of business if their grants are poorly considered. Since the Galapagos Islands are mainly famous for their huge, otherwise extinct, tortoises, the book may also be suggesting that big foundations tend to be slow-moving and self-protective - a living fossil. (Yes, it is a witty way to speak to those who might well be clients of Bridgespan, founded by Tom Tierney.) Tom is the kind of advisor who manages to get said what needs to be said, but in a way that is congenial, even to those who must laugh a bit at themselves.

Answer 33

C) Both I and II The correct answer is C. Peter is a poet; he holds a degree in poetry (a Masters of Fine Arts). And he is a great believer in the power and importance of the moral imagination. We need empathy as advisors to enter into the worldview of those we seek to serve, to listen to them, to feel ourselves into their shoes, even if their lives are very different from our own. At the same time, however, the donor, in Peter's view, must not blindly impose a gift on a community served, as if the donor were the savior of those in need. Rather, the donor, too, must have some empathy for those served by the gift, and feel their way into the very different world the gift may enter. This level of humanity and wisdom is what Peter exemplifies.

Answer 34

C) Both I and II The correct answer is C. In doing scenarios for a client who wants to consider giving, both the effect on the client and the effect on society (via a gift to a charity, now, later, at death, or beyond death) are relevant. In a way, CAP-style planning is like a Rubik's Cube, with one dimension representing the effect on the client and family, and another dimension reflecting the effect on society. The well-counseled client will plan to optimize across these dimensions. The planning could address such questions as, "How generous can I afford to be without affecting my other goals?" "How can I minimize taxes in favor of children or charity?" "Which asset is it most efficient to use?" "What tools work best for self, family, and charity?" "When can I afford to give?" "When will my gift have the greatest impact?" "If current impact is best, can I pay for it in installments?" "How can I be sure the money that goes to a charity is not wasted?" Few advisors today work at this level, but the need for it is significant.

Answer 35

The correct answer is C. Both are true.

Answer 36

C) Both I and II The correct answer is C. Both are correct. Our initial questions can "prime" a client for a discussion of tax, tools, and techniques, or our initial questions can prime the client to consider legacy planning under the heading of purpose. Priming might also depend on the setting: are we in a business office, at a desk, with computer printouts and legal books? Or, are we having the conversation of legacy while walking on a mountain path, or sitting together on the client's veranda, as the waves roll on the beach? Priming can also be determined by the advisor's demeanor. To what issues are we receptive? What issues do we dismiss? What body language or verbal cues signal our willingness to diverge from our technical expertise into a conversation of purpose?

Answer 37

II. What areas are out of bounds for discussion with the family B) is correct. The question is making the point that in a good family meeting, we do not defer to the older decision makers. Yes, we respect them, but we do no let them run the show through us. The Compact also lays out ground rules for what can and cannot be discussed with the family as a whole. And how the family will prepare for the meeting and how they are expected to show up in what frame of mind.

Answer 38

C) Both I and II The correct answer is C. Both might help Mandy avoid being "triggered." Philanthropy does come, often, from passion. We come from our cultural identity, from our faith-based or philosophical traditions, from our gender positions, from our sexual identity, from our heritage, from our political traditions. And in asking for a philanthropic issue, or passion, or cause, you will get sometimes far more passion that you had bargained for. People will erupt. That is the nature of this game. When they are triggered and you get triggered, there can be - it happens - a real meltdown that can make it difficult or impossible to maintain a continuing business relationship. The saying about clouds across the sky comes from Patricia Angus, JD, who counsels us to let the emotions pass and look for the good in what the client means to do. There can be good in what they mean to do, even if how they express it sets you off. The saying that all philanthropy is personal comes from Tierney and Fleishman. You can perhaps imagine Tom Tierney at Bridgespan counseling Mandy. "It is all personal, Mandy. His passion. His money. Get over it. It is our job to help him, not judge him." Likewise, in the same spirit, Peter Karoff says, "Philanthropy is private action in a public space." That is an eloquent remark, one that Mandy might take to heart. "You mean like here in this conference room?" she might ask. And Peter might say, "That conference room has been the scene of many moments like this from all over the philanthropic map. People come to us to take their private passion and build something public - to change the world for the better, by their own concept of better." Philanthropy is often warm-blooded work for the client. While we may not share each person's passion, perhaps we can be grateful to live in a country where each of us can use giving to advance his or her own private concept of the public good.

Answer 39

B) Donors neglect to fund nonprofit essential overhead The correct answer is B. Give Smart suggests that, in effect, nonprofits are undernourished by their funders, starved of necessary ongoing operating funds, while funders concentrate on more glamorous programs and projects inside the organization.

Answer 40

A) I only The correct answer is A. "Liminality" is the state of hovering on the threshold betwixt and between two selves, the self you used to be that is now dying away, and the new self you are becoming. Louise is finding, in a way, that she is not really or not solely, the Doctor of Sociology. That self is being left behind. And she is about to forge a new identity, a break with the past. Tad is on a straight upward trajectory. His business self, his identity, is intact, and endlessly confirmed. Yet, like Bob Buford, in Half-Time, the day may come when life breaks him in half, perhaps when a child of his dies or he goes through a divorce, and he feels that all he has accomplished is ashes in his mouth. Why even raise these issues in CAP? Because when a person makes himself or herself anew, giving or philanthropy or volunteering or board service may be the avenue through which they do so. It was for Bob Buford. It was for the young actress in Free Art. It was for the Fitzsimmons, as they left behind their old identity as business people and moved into philanthropy at retirement. Maybe, in your case, it is one reason you are taking CAP. And for your clients and donors, your work can help them step over the threshold into a new and better life, a fuller expression of who they are, and what they're for.

Answer 41

A) Strategic The correct answer is A. This is strategic to an extreme degree. The pushback may come from local parents, school boards, and teachers, who want autonomy as well as "results." Social change or grassroots philanthropy is more from the "bottom up," and tends to see local people as having the ability to solve their own problems, rather than having them solved for them from Washington or from a distant charitable foundation. For some issue areas, and at a certain scale of funding, strategic philanthropy clearly fits: curing malaria, funding new energy research, reducing pollution. In other areas, where we are dealing with issues that are more personal and touch on human agency, and where the funding dollars are relatively small, then social movement or social change philanthropy may fit better.

Answer 42

A) I only The correct answer is A. The best use of a discernment model is with "the few and the best" clients working with a trusted advisor who can afford to take the time. For mass affluent, or middle-income clients, the model may simply be "overkill." For a client with low income and net worth, and whose needs are simple, a more traditional sales or expert model may be completely adequate and more cost-effective. In other words, as a CAP, "pick your shots." Do not, as the saying goes, "use an elephant gun to hunt rabbits," nor vice-versa.

Answer 43

C) Has inherited some money The correct answer is C. A big inheritance might require a team; it might depend on the amount and the form. High net worth requires tax planning, investment planning, and other sophisticated planning for both money and the family system. Owning a business is a prime indicator of the need for a team, since non-liquid assets present special issues, as do the complexities that go with a family firm where some family members are owners, others are employees, and some are managers. Other issues that require a team include the imminent sale of a major asset and a sharp rise in income.

Answer 44

Deciding how much is enough for heirs The correct answer is D. Marty Carter, a family therapist, invokes a memorable contrast between "dilemmas" and "problems." Advisors working on tools, techniques, plans, and legal documents solve planning problems, like building, protecting, and transferring wealth, but what often holds decision-makers back are not planning problems but dilemmas. How much is enough for me? How much is enough for heirs? If one child is wealthy and one child is poor, what is fair and what is equal in wealth transfer? Planning problems have solutions. But moral dilemmas have no one right answer. Yet, planning cannot move forward until the dilemmas have been addressed. They may not have a solution, but they do require a decision.

Answer 45

A) Reflection, Qualitative Discussion, Quantitative Analysis, Implementation, Results Maintenance A) is correct. Note how the human dimension comes first. Quantitative Analysis comes later, and only then do we get to solutions, implementation, and ongoing service. It is a great process but it does take time. Wealthy families can justify the time and expense. Simpler situations may demand a more product focused solution.

Answer 46

C) Both I and II The correct answer is C. Both are true. This question is meant to remind you that you do have to "pick your shots." Not all clients need a complex process; not all can afford it.

Answer 47

D) Neither I nor II Actually most families know financial education is needed for heirs. Heirs do feel unprepared. But, nevertheless, most families do not provide it.

Answer 48

C) Both I and II The correct answer is C. Both are true. The maieutic method is that of the midwife. Socrates saw himself as using questions that induced labor. The client gave birth to his better self, and the old self might die in the process. Call that discernment, but not all men like giving birth to a better self. Some of Socrates' contemporaries wanted to remain undisturbed within their traditional pieties. Socrates was executed for blaspheming the gods, particularly Hermes, the trickster god of the cross-roads, which is ironic, since Socrates was a bit of trickster himself. In any case, the Athenians regretted what they had done and erected a monument to Socrates. All of this is mentioned as fair warning. Induce discernment at your own risk, but also, like a good doctor or midwife, "First, do no harm."

Answer 49

D) Understanding who the family is and what they will become D) This is an important CAP point. We begin with people first, not possessions and technical strategies. The starting point and ending point is the persons involved, where they are now and how to get them to where they would like to be.

Answer 50

Family-owned company The correct answer is A. Typically, the family-owned or controlled entities such as businesses, properties, foundations, partnerships, and the like are among the elements governed by the over-arching governance structures. Different families may use different combinations of governance elements, but these might include a family constitution, a family assembly or council for all family members, a family legislative body drawn from the family assembly, and a family executive body to oversee the decisions taken. Figures like Jay Hughes, Patricia Angus, James Grubman, and Tim Belber may help the family set up and run these governance structures. Advisors skilled in "family dynamics" sometimes speak of their work as addressing family governance. Such family governance experts can help hold "family meetings," where the family bonds, has fun, learns, finds shared values, irons out differences, and participates in family traditions

Answer 51

C) Both I and II The correct answer is C, both rights and responsibilities. This is an ancient and honorable view, sometimes associated with the best in "old money." Society makes a compact with the wealthy, so this idea goes. The rich can have money, power, and privilege. But in return, they are expected to live up to certain responsibilities, to look out for the good of the whole, for the commonweal and the commonwealth, for the health of the society as a whole. Responsibilities can include public service, leadership, moral leadership, volunteering, and giving. You hear that same note struck by Reverend Gomes in Collier's book. "Wealth" is not just private treasure for private use. Money has civic content, and society has a claim on our money. The wisdom of "to whom much is given, much is expected" has a firm place in the moral landscape of the West for thousands of years. That, as Peter Karoff says, is "elevating the discourse of philanthropy."

Answer 52

B) Principles, policies, practices The correct answer is B. First the advisor must clarify the principles on which a family operates or aspires to operate. You might think of this as the guiding values against which all that follows can and should be tested. Then comes policies. That is, the values or principles that should be embodied in the plans, legal documents, and other written governing structures. But all this is empty, unless the family lives the plan in regular practices. Hence: Principles, policies, and practices.

Answer 53

Why we do what we do

Answer 54

C) Both I and II The correct answer is C. Both are true. Every one of the people mentioned, along with Schervish, Backer and Friedland, Mary Carter, Lee Hausner, Tracy Gary, Peter Karoff, and the course author, are trained in both an analytical discipline and also in at least one of the humanities: Sociology, Divinity, Psychology, Literature, Mythology. They are teaching us how to align the humanities ("above the line") with the tools and techniques of law, accounting, finance, and strategic philanthropy "below the line." Above the line, the conversation is often driven by narrative, below the line by analytics. Both are needed.

Answer 55

Telesis The correct answer is A. Telesis is the unfolding and fulfillment of meaning in time, the course of purpose, Providence, fate, destiny. Phronesis is practical wisdom, the knack that skilled and wise people have of seeing what needs to be done, and doing it quickly enough, before time runs out. Peripeteia is a term from Aristotle concerning drama. It means climax or turning point in a dramatized life. Anagnorisis is the moment of recognition, when a character or an audience is stunned to see what they had not seen before; ultimately, what they had not seen was themselves. Above-the-line is understanding not as a plumber understands pipes or a bookkeeper understands a ledger, but as a person of taste and judgment understands tragedy, comedy, romance, parable, fable, satire, and for that matter, farce. Even to know which is which takes judgment.

Answer 56

D) Breadth of issues addressed and depth of client/advisor relationship The correct answer is D, breadth of issues and depth of client/advisor relationship. The lowest level is expertise in one area (such as law, accounting, investments, insurance). The second level up includes one area of expertise plus knowledge of an adjacent field -- for example, an insurance professional with a CPA background. The third level up is broader yet regarding breadth of issues -- for example, an 'old hand" who has good peripheral vision or situational awareness and who can connect the dots over several disciplines. The highest level is reserved for the trusted advisor, who may have an area that he or she is an expert in, but who also has a broad understanding of every element of the emerging plan. Such an advisor emerges as "the trusted advisor" or "most trusted advisor" because they can synthesize the overall plan and translate it into terms the client can understand. This "synthesizing generalist," as Lowell Weitz, calls it, can pull together the relevant team and manage it with or for the client. The overall point here is that many professionals work very hard to be "best of breed" in their area of specialization. And that is very important. But for a team of specialists to work, at at least one person on the team has to have good overall judgment and see the plan whole, so that the specialists are working towards a shared vision, one that the "trusted advisor" coordinates with and for the client. Figures like the Fithians, Maister, Green and Galford, Dave Holaday, John A. Warnick, James E. Hughes, Jr., Tim Belber, and Patricia Angus are examples of trusted advisors who have mastered their respective "trades," gone beyond those to become familiar with adjacent fields, and then emerged as the most trusted advisor overseeing a team on behalf of the client. Note that almost always, the most trusted advisor is also a deep expert in a specific core discipline. The most trusted advisor may be paid primarily as that deep expert in that one "trade," but what makes them the most trusted of the experts is their breadth of knowledge as well as their depth of knowledge, which is one reason the relationship with the client is deeper. The most trusted advisor can see the big picture and act as the client's confidant and team leader.

Answer 57

A) A profoundly wealthy person whose giving can change the conditions under which others live their lives The correct answer is A. A hyper-agent in philanthropy is one who can change the conditions under which others live. Bill and Melinda Gates, for example, don't just give to their alma mater, but, rather, seek to reform the U.S. educational system. They do not give to relieve the suffering of a few people with malaria; instead, they seek to eradicate the disease.

Answer 58

A) In chaos The correct answer is A. Chaos is about to result, if it has not done so already. The three C's for Patricia Angus are, Chaos, Coordination, and Cohesion or Continuity. To get there, she recommends we bear in mind the three P's: Principles, Policies, and Practices. The error the father has made, and maybe it can be corrected with the help of Tallulah, the CAP, is while still in chaos, to move directly to practices, in this case the practices of making grants. That is hopeless unless there are policies in place first to guide those practices. The policies, for example, might be written in the bylaws or otherwise reduced to agreed-upon guidelines. To get to those, however, the family had best first seek common ground, shared principles. Do they have any such shared principles? Family meetings may help hash this out. Ideally, out of such might come a family mission statement that is more than verbiage. It can become the codification of guiding principles that can shape the policies and the practices throughout not just the foundation but also over the other entities touching the family, such as the trusts and other arrangements that will hold the family wealth when the father is gone.

Answer 59

A) Simple The correct answer is A, Simple. Certain problems do fit with businesslike metrics: if a specific tutoring program costs $2,500 per student and increases the probability of getting into college by 50%, then a gift of $250,000 will enable 50 students to get into college, when, without the program, they would not have done so. Such a program could be tested with matched groups, some getting tutoring, others not. The data could be as neat and clean as a medical trial of a new drug. Peter will be delighted! (Experienced grantmakers might mutter, "About his speed!"). The challenge for Peter lies with problems that are less simple. Some are complicated, with many elements. Some are complex, with elements that interact in unpredictable ways. Other are wicked, with no known solution. Even the tutoring program may prove complicated or complex. For example, it might be that what holds students back are poor parenting, hunger, violence, lack of a computer at home, and on and on. Peter may go into his work thinking that all problems are simple and should fit businesslike metrics, and years later he may be saying, "Philanthropy is harder than business. It takes all kinds of new skills. Who knew? The hardest part for me has been learning humility. The best results ultimately came from getting to know the parents, and asking them what needs to be done...." For many problems, as Peter Karoff has wisely said, "Change is incremental at best."

Answer 60

C) Both I and II The correct answer is C. Both are true. Many authors in this course, including those cited plus Carl Rogers, Otto Sharmer, Tracy Gary, H. Peter Karoff, and Parker Palmer, make similar points about the importance of reflective silence in enabling a client or donor to reach their own discernment, or moment of clarity. We accompany the client, we do not really guide. Often, the best we can do "above the line" is to create an open space for them to think without being judged. Such silence, Carl Rogers says, is formative of the very personality of the one heard. Otto Sharmer calls it "generative." The Fithians (who follow Paul Schervish, who was following St. Ignatius Loyola) call it "discernment." Tracy Gary talks of "accompaniment" and "inspiration." H. Peter Karoff speaks of "The long-distance call" that enters a gracious silence. Parker Palmer invokes "circles of trust," in which each participant speaks into the silence at the center of the circle without presuming to respond to, or interpret, or judge what is said by anyone else.

Answer 61

A) funder insists on a logic model when none is possible The correct answer is A. The book does not question whether a "logic model" is always possible. Interestingly, the most advanced conversations today (at, say, Stanford Social Innovation Review) are on the topic of complexity - how some issues pose such "wicked problems" that they do not lend themselves to a linear, logic-driven solution -- for example, racism, war in the Middle East, terrorism, climate change. What logic model would connect an input with an output that connects to a big change? So, this question flags what may have been a blind spot in the book. Clearly, though, the authors are themselves evolving, and they would almost certainly agree, given the current state of the discussion, that grants do fail when they presume a logic model when none is possible. Better, sometimes, to take an educated guess, probe, sense, and revise. (This is now called "adaptive philanthropy," though it has been done under other names by experienced funders, like Tracy Gary, for example, for a long time.)

Answer 62

B) Those with wealth have both rights and also responsibilities, not only to themselves and their children, but also to the larger community. The correct answer is B. The wording comes from The National Center for Family Philanthropy and embodies the ethos of what is sometimes called "old money," or established multi-generational wealth, at least in certain established families. For these families, wealth is more than rights and privileges; it also confers responsibilities. Philanthropy (along with, say, public service) is among the ways these families keep faith with those whose lives are less fortunate. Passing on family values then becomes a matter of passing on traditions of service to something larger than self and family. Not all longstanding wealthy families would subscribe to this "compact," and newer wealth may not always be familiar with high-sounding old phrases like "the social compact," but NCFP is an eloquent spokesperson for it, as are figures like Peter Karoff, Tracy Gary, Charles Collier, Parker Palmer, and others cited in this course.

Answer 63

D) Neither I nor II The correct answer is D. Her three Ps are Principles, Policies, and Practices.

Answer 64

C) Both I and II The correct answer is C. Both are true, but this is very challenging work for planners. Software for planning does not generally anticipate a client who is planning for impact as well as planning for security. So, the planner may have to do custom work; not all planners will rise to that. But planners who can plan for impact in the context of family wealth can be a significant asset for a charity or community foundation. Generous clients do need and want this kind of work, and it helps them be more generous and feel more at ease giving big.

Answer 65

C) Both I and II The correct answer is C. Both are true. The expert is credible, but the discernment-based advisor is considered wise. Sometimes, the better part of wisdom is keeping one's own counsel. The less some of us say, the wiser we seem. Discernment is not the advisor's discernment of the client, but the client's self-discovery made possible by the thinking space the advisor has created. Once the client comes to clarity, there is no mistaking what he or she intends. The client becomes indomitable.

Answer 66

D) One whose wealth background is mixed The correct answer is D. He is of "mixed" background as to wealth because he is an inheritor who has known both the life of a middle-class or lower-middle class person, and also the life of a wealthy person. He transitioned over time as his mother's wealth grew. She would be a pioneer. If Barry were now to marry someone whose family never had any money, she would be a "transplant." If Barry's children grow up knowing only a world of wealth, then they would be natives to wealth.

Answer 67

C) Both I and II The correct answer is C. Both are true. Consider how large a family will become over five or six generations. It becomes first a family, then an extended family, and ultimately a clan or tribe with many branches, some perhaps all over the country or all over the world. Cohesion becomes an issue. What if the family has a particular value system, an approach to life and to business, and a particular member or branch of the family "wants out"? Under what terms can they leave? What can they retain? What must they give up? These issues are predictable, and the most successful multi-generational families have them covered with an agreed-upon "exit policy."

Answer 68

C) Both I and II The correct answer is C. Both are true. Carnegie was ahead of his time in writing up his values and personal story as way to align his philanthropy with his moral compass.

Answer 69

C) Both I and II The correct answer is C. Both are true. Discovery/Agreement is a term planners use to describe the first phase of a client engagement, in which the client and the advisor are deciding whether to work together and, if so, how. The advisor uncovers what the prospective client is trying to accomplish, and some of the relevant facts about the client's situation. Then, the advisor and prospect either reach an agreement to work together, along a particular process, or the prospect decides not to go forward. Discovery/Agreement, then, is a first "yes," not to a sale, but to a process guided by purpose towards a goal important to the client. A core point in CAP is that Discovery/Agreement is the right place to elicit major client goals, including charitable goals.

Answer 70

A) De facto The correct answer is A. Her team is, basically, hit or miss. It was never put together intentionally or on purpose. It just came together over time, through friendships and chance encounters. Sadly, this is how many clients do it. What the Fithians are suggesting is that there be some method to this madness. The client should have a core team whom she has carefully chosen to be of a caliber adequate to her current complex situation. In addition, she might need a virtual team beyond the core team for specific decisions -- for example, selling the business or getting serious about philanthropy. The term the Fithians use for the kind of team Jill has is "de facto." It is a team, more or less, or in name only, but not a team built to purpose.

Answer 71

A) I only The correct answer is A. The first is certainly true, but generally a family office will both compete and collaborate with best-of-breed independent advisors. For example, the family office may have legal talent on staff, but may also expect individual family members to have their own legal counsel. Certain complex tasks and services may also be "outsourced" and coordinated.

Answer 72

D) Neither I nor II D) is correct. Incentive Trusts typically "parent from the grave" by encouraging specific behaviors. The problem is that they may encourage the beneficiary to game the trust, rather than developing healthy financial habits and becoming autonomous and self-directed.

Answer 73

C) "Sharon, What principles have guided your legacy planning to date?" (Spoken by a fundraiser for her university.) The correct answer is C. C is the lowest in Self-Orientation. The concept of SO is not all about selfishness per se. It is about being visibly on a mission to accomplish something specific for yourself, as an advisor or fundraiser or for the organization you represent. In every case but C, it is clear where the person conducting the interview is coming from - a desire to close a deal or advance a process towards a result that benefits the organization that has sent the advisor or fundraiser out to conduct the interview. The result is relatively low trust, even if Credibility, Reliability, and Intimacy are rated high. "Who are you here for?" is the question in the donor or client's mind. "Are you here to serve me or the organization you represent?" Of course, in C, the fundraiser clearly represents the University, but he has "cut the donor some slack" and is beginning with the donor in mind, not any specific "ask." The fundraiser begins with an open question, all about the donor and the donor's values and plans. That shows low "State U" orientation and high donor-orientation. That means higher trust, and that, in turn, can translate over time into better results.

Answer 74

A) I only The correct answer is A. Requiring endless reports for short money is setting a charity up to fail, but requiring them to show reasonable results over time makes perfectly good sense. It is also worth noting that Give Smart is committed to "Strategic Philanthropy." It does assume that each charity should have a workable plan (or logic model, or theory of change) for getting results. There may, however, be certain situations when the problems being addressed by the charity are complex or "wicked," where a simple logic model for change is just not possible. The authors of Give Smart do not seem to contemplate the possibility that requiring a logic model to get results might be counterproductive in some cases. In the years since its publication, commentators have suggested that complex and wicked problems may require a style of philanthropy that is more "adaptive." Test and revise. Try this, try that. See what works. Change quickly. So, on the list of ways that charities could be set up to fail, an additional item, not mentioned by the book, might be "requiring a simple logic model when none is possible, given the complexity of the issues."

Answer 75

A) The two phases of life should overlap, so that the business owner is exploring a new phase of life even as they continue, for now, in the business. The correct answer is A. Bob is suggesting that we not hang onto our business or corporate identity, then abruptly end that and start something new from scratch. He wisely suggests that many of us will do better to double up, working in the business for a time as we proactively explore our next stage of life. Bob himself did so. He used what he calls "low-cost probes" to test out his philanthropic and nonprofit ideas before he sold his business.

Answer 76

A) Determine to live divided no more; form communities of congruence; go public with a shared vision; change system of punishments and rewards The correct answer is A. A movement, as Parker Palmer thinks of it, is neither an entity nor an organization; it grows more spontaneously, particularly among those who feel that their identity is not respected (women, people of color, the poor, religious minorities, gays, lesbians). Step one is the internal determination to "live divided no more" - not to accept the status quo.

Answer 77

A) I only The correct answer is A. The first is true; Bob did feel he had to choose between financial success as his highest value and his faith. He felt one had to, in effect, be subordinate to the other. Yet, the second statement is not true. He did not engage in black-and-white thinking, exiting the business, and then starting over with a new rising curve in philanthropy. On the contrary, Bob makes a point that will resonate with many business people. He counsels business people to stick with their business as they conduct a series of low-cost probes in a new direction, and then start a second curve in philanthropy overlapping with their business career. Not only does this build wealth, in part to fund the philanthropy, but it takes time to learn philanthropy, and it is best to start earlier, then transition. Interestingly, Bill Gates did something quite like this. He started a foundation while still leading Microsoft and transitioned gradually, until he has, for some time now, been fully devoted to his foundation.

Answer 78

D) Is driven by a faith in grassroots people to make their own decisions The correct answer is D. The strategic grantmaker, as here, tends to rely on the theory, hard evidence, and their own expertise rather than trust "anecdotal evidence" and passion from those face-to-face with the issues on the ground. This can lead to culture clash with grantees, who can see the funder as coming in from the outside and using money to impose changes. Every giving style discussed in this assignment has its best use. This example shows an excellent use of strategic grantmaking with a logic model. The issue is close to science, involving something quite measurable -- health outcomes. The dollars may be large enough to effect change. The grantmaker has expertise. The grants and the way they are made and supervised are all in line with the spirit of the original foundation funder.

Answer 79

Grantmaking without a real plan for how the money will produce a good outcome All of these statements are correct except the last. A grassroots giver makes grants to people he or she knows will get the job done. The plan is to rely on the abilities of the local leader rather than on an abstract business plan or strategic plan. The local leader may or may not have a plan on paper. The point is that the leader knows what he or she is doing, and the funder is backing that person based on personal engagement with that person, face-to-face.

Answer 80

D) Late life The correct answer is D. David is, in effect, a practical gerontologist. His work has revolved around working with seniors, aged not 55-65, but more like 75 through end of life. What he found is that the word "control" is very important to those who are losing control over their money, their memory, their bodies, their lives. So, it is all about retaining control. Yet, it is also about something that will live on after they are gone, how their story will continue after death, and how that story grows out of their whole life up to that point. He calls that a longing for an "organic legacy." To achieve it, a senior must accept mortality and maintain control by letting go, by creating a plan that passes the assets, traditions, and values on in a thoughtful way.

Answer 81

B) II only B) No, funders are not legally accountable to grantees nor to communities served. Some would say that they are accountable only to themselves, subject to limited IRS supervision and supervision by the State's Attorney General. But with the rise of the internet, funders risk being called out and publicly shamed if their practices are at odds with the needs and philosophies of the communities they purport to serve. In this respect, social media has changed the game. Likewise, a growing number of books and articles are calling funders to account.

Answer 82

A) I only The correct answer is A. Bob is a very practical man. He knows that while it is good to reflect on your goals, you can't expect to find your passion in philanthropy just by meditating. You have to get out and experiment, trying this and that, until something clicks. He suggests doing so early, while still involved in the business phase of a career, testing out a few things without making a full commitment. As CAPs, we can be of service to our clients by suggesting a few things they might try without having to commit a great deal of time or money. Those practical experiences can then help them shape their future, more ambitious, philanthropic projects.

Answer 83

A) I only The correct answer is A. Fact-finding is gathering relevant client data. This is also called "data gathering." Generally, the advisor uses a form, sometimes running to 30 or more pages, to gather information about client assets, liabilities, income, expenses, family situation, benefits, legal arrangements, insurance information, and more. Generally, the information is sufficient to generate an income statement and/or a balance sheet. This is to be contrasted with the hit-or-miss kind of conversation in which a product, gift, or service is "sold" straight up, without asking much first about the client's or donor's assets and income or current legal arrangements. Advisors who conduct serious "fact-finding" and construct plans and solutions in the context of the client's projected income statement and balance sheet are likely to resist "gift opportunities" presented by a gift planner out of context. Gift planners may not be able, or positioned, to do a full "fact-finder," but they should recognize that the CPA, financial planner, or estate tax attorney may have done so. In that case, the gift planner must decide whether to work with, against, or around the advisor who is the custodian of the data and keeper of the plan. The larger the dollar amount, the higher the percentage of donor assets or income, the more complex the gift structure, the more likely it is that advisors will be consulted, and the more important it is for the gift planner to be engaged in a conversation with the advisors as well as with the client.

Answer 84

B) Wisdom The correct answer is B. The discernment style rises above expertise to wisdom. The expert sells advice, has information, and relies on reasoning and logic, and on facts and figures. The expert narrows down the choices. The advisor in the expert style is a technician, who is reliable, credible. The expert tells. The expert is willing to form a team and may be a trusted advisor. The discernment-based advisor rises above mere expertise to wisdom. They may be the most trusted advisor. If this question threw you, it would be a good idea to review the charts from the Fithians in the first assignment. Those charts are dense with information - but, more importantly, with hard-won wisdom.

Answer 85

D) Successfully accessing one's own ignorance as an advisor D) is the answer. It is a memorable way to say, "Start with humility, and recognize you don't have the answers. Listen with humility and let go the assumption of your own brilliance."

Answer 86

C) Both I and II The correct answer is C. Moral imagination is the ability to see life through the eyes of another person, and to see it feelingly. Moral imagination is related to empathy, or "walking a mile in another's moccasins." Hannah has seen herself in a young woman in poverty. But it is not only clients who can rise to moral imagination and use their giving on behalf of an ethical vision, or identification. As advisors, we, too, bring to the planning table, or could bring, our own moral imagination, not imposing our views on the client, but creating conditions under which the client can express, and we can discern, the moral dimension of the choices the client is making about wealth, family, and society. There are times when it does take a good deal of imagination to detect the moral impulse or sensibility latent in the client. Sometimes, we have to risk what may seem an odd question to take the client's pulse - to see if the client is accessible as as a moral agent, or is it all about the money, and only about the money? Then, as the client opens to us, we put our own vision aside, and listen with moral imagination as if from within the client's world.

Answer 87

Strategic philanthropy A) Strategic philanthropy comes out of a business mindset. It tends to see the donor as an investor who gets results. Grantees are sometimes seen almost as vendors, subordinate to the funder. Grantees sometimes are made to compete for the funds. Each of the other styles mentioned explicitly push back against the idea that they are accountable to the funder. They seek to reverse the polarity so the funder is accountable to, or at least responsive, to communities served. "Shift the power" is the idea. Admittedly, good strategic philanthropists, like Tom Tierney in Give Smart, do seek partnership with grantees. But that book does not suggest that funders are accountable to the community, In fact, the book suggests that funders are, effectively, accountable only to themselves. It is a great book but that sense of being unaccountable has not aged well. Today the authors would certainly acknowledge that, for example, wealthy white funders of programs for, say, communities of color must be responsive to and even accountable to communities served.

Answer 88

D) Gift to college, to provide leadership training to senior leaders The correct answer is D. Most likely, funding leadership training will strike Mark as the best way to increase the capacity of the organization to operate effectively. He might also be interested in gifts to fund technology, or more efficient accounting systems, or better reporting systems to support top leadership. He might even consider an unrestricted gift and leave it up to the school how it will be used, considering his gift an investment in the overall capacity of the school. The other gifts mentioned are programs, which presuppose existing capacity to undertake programs.

Answer 89

B) Don't feel connected to the charity The correct answer is B. "Don't feel connected" and "Fear the gift may not be used wisely" were the top two reason donors say they don't give more. The course you are taking should help you address these concerns -- that is, making sure that the gift is not only tax-smart but that it also makes the donor feel connected and confident about the gift being used wisely, for impact.

Answer 90

Origins and Ends Paul is addressing stories like those in history, myth, and scripture of first and last things, of origins and ends. Genesis is how things started. Telesis is the destined end towards which they tend. Paul found that wealthy people almost automatically tell the stories of their lives as fables, with an original set of circumstances, a narrative arc, and an end that points a moral. A Gospel of Wealth in which they seek to align their moral compass and their financial capacity. They seem themselves, variously, a heroic, destined, or fortunate. Hearing how they tell their life tale, we can help them write or find an appropriate ending or sequel.

Answer 91

C) Both I and II The correct answer is C. Both are true. Give Smart does not deny the emotional elements of philanthropy, but is very much a book addressed to the strategic side of informed giving. Peter Karoff seems to have been the first to stress "strategic philanthropy," many years ago. Yet, he also has a Masters of Fine Art; he is a practicing poet. His effort, for his whole career, has been to show that philanthropy can be expressive, like poetry -- inspired, grand, noble, uplifting, moral, compassionate, and also strategic and effective. Not either/or, but both/and. He is a good role model, in this respect, for CAPs, whose symbol is a hand (craft) holding a heart (passion).

Answer 92

B) II only The correct answer is B. Direct relief includes such things as care for the sick, homeless, hungry, impoverished. It can be described as treating the immediate needs or symptoms rather than trying to change the underlying systems. Direct relief is distinct from philanthropy for "system change." Medical research does not cure a patient today, but over time it can change the game by creating new cures. Gifts to a think tank to build a case for policy change is another example of "system change" philanthropy.

Answer 93

B) II only

Answer 94

C) Both I and II C) Both are true. Inflexibility is likely to backfire. Not having clarity about successor trustees can also cause unforeseen problems.

Answer 95

C) Both I and II The correct answer is C. Love and money. Not easy to reconcile when, for example, Dad has to fire Son. Or, when Mother has to sell a business and Son loses his job in the process. Or, when Dad sells 51% of the family business to Son who gives no dividends from the firm to Daughter who is given 49% of the firm and has no market to sell it. Such tensions can destroy families, even if the plans make business, tax, and financial sense. Hence, many successful multi-generational families, have someone like Marty Carter or Dr. Lee Hausner on the team to address family dynamics not as a side issue, but as a key element in the planning process.

Answer 96

D) Frames grants in terms of "the moral dimension" The correct answer is D. The moral dimension may be implicit in all giving, since all giving posits a world made better in some way. But the language of strategic philanthropy is "all business." The language is that of strategic planning in a businesslike context.

Answer 97

D) Strategic D) is the odd one out. The other three go together in their conviction that communities and intermediaries within those communities know best what is right for that community. The funder at the big foundation has to let go and trust those closest to the action. The grantees and their local intermediaries are treated as participating in the solutions, not as passive grant recipients, or as the equivalent to vendors delivering measurable solutions within a strategic plan created by the funder.

Answer 98

B) II only The correct answer is B. "Due diligence" implies that some real research is done. This can involve site visits, review of the organization's financials, or meetings with staff, Executive Director, and Board. Due diligence might also include meeting with other donors who have experience with the charity and others like it. Research might also be conducted through online rating services. All of this is in contrast with just asking yourself how you feel about a gift.

Answer 99

A) Discovery/Agreement phase The correct answer is A. Often, advisors "back into" social impact long after the estate plan is in place, or only towards the end of the process. This understates and underserves the philanthropic impact goals, in many cases. The client should be asked early on in the discovery phase whether they want to plan only for self and family or for self, family, and society. Do they want an impact that goes beyond self and family? And when does the client want impact? Now, later, at death or beyond death? Then, the tools, including charitable, can be organized and harmonized to achieve the most effective and efficient impact on all three areas (self, family, society). This is the ideal, but the author has often found himself brought into estate-planning cases after the plan is documented and all but finished. The author is then asked to discuss whether, say, a Donor-Advised Fund or Foundation is best to accept and "zero out" the taxable estate. Asking a few questions about why the donor wants to be generous, and when, and with what impact, soon reveals that the whole plan is out of whack because the estate planner, say, is aiming the taxable estate at death into a testamentary foundation and the client, it turns out, wants to have as much impact as possible as soon as possible, with as much hands-on involvement as possible. These issues should have been covered by the estate planner before the plan came together. Raising them late can force a total revision, which is embarrassing and costly.

Answer 100

C) Both I and II The correct answer is C. All adults need to achieve a sense of financial independence, but heirs must also acquire the skills needed for financial interdependence, as they find themselves enmeshed in any number of family entities that include owners or stakeholders other than themselves. They may be beneficiaries of trusts, voting or nonvoting members of family partnerships, owners or employees of family businesses, sharers in family vacation homes or private planes or boats. Dad and Mom did it their way and may be fiercely independent, but if the parents do no more than pass independence skills on to their heirs, trouble may ensue. The heirs, far more so than the parents, are living in a world where they must get along with one another, with respect to assets owned or controlled in common.

Answer 101

B) II only The correct answer is B: "genesis," as the source, origin, the setting out; "telesis," as the animating purpose that runs through a life, a life's end and purpose. Paul is suggesting that we see our lives not just as stories, but as stories with a moral purpose. They are stories of fate, destiny, fortune. You could say that they are fairy tales or myths. Or you could say that they are archetypal stories of moral heroism or self-discovery. However you say it, what Paul knows is that if you let them, the wealthy will hesitantly, and often uncertainly, begin to tell bits and pieces of a life-as-quest, or of life as a journey, or life as insight found. ("Once was lost, but now am found." "Rags to riches." "David and Goliath." "Jonah emerging from the belly of the beast." "The prodigal returns.") When you hear their life story, you will hear a purpose announcing itself. Completing that life purpose is what may drive a gift, a planning process, or a legacy

Answer 102

B) It is highly efficient The correct answer is B. A sales interview or solicitation interview can be one hour and a check is written; an expert generally uses at least a two-interview process (understand the issues through discovery, go back to the office to work up a plan, return with plan, and close for a decision). A discernment process may involve going to the client's ski house for a weekend, or meeting on the veranda of the beach house and noodling and talking, not just for hours but for days, over a time frame that may work into years before any deal is done. This means that these cases are very few and very large. It is a rookie error to use (as the saying goes) an elephant gun on rabbits. It is also a rookie error to use a .22 on elephants, unless you mean to annoy them. The point is to pair the process with the prospect.

Answer 103

C) Both I and II The correct answer is C. These are the focus of most financial, tax, and legal advisors who recommend charitable tools and techniques.

Answer 104

A) Excellent tax, legal, and financial advice The correct answer is A. As an outcome of this course, you should recognize that legacy planning at the highest levels - the table at which planning occurs - is changing. Traditionally, it has been the "experts" in law, accounting, and finance who have vied for the role of "the most trusted advisor," or the "quarterback." Increasingly, however, it is liberal arts-trained advisors who take on family dynamics as their area of expertise, who are going from the "virtual team" to the "core team" and then to the head of the table as the most trusted advisor. Some are also cross-trained in law or finance. But it is important to know what these advisors now agree are the essential things wealthy families must do to be successful over many generations. Grubman, with a doctorate in psychology, gives you those insights. You could say, rightly, that he is promoting his own work, since he sets up family governance structures. And you could say he understates the importance of good financial, tax, and legal advisors, but the truth is that Grubman takes for granted that wealthy families have good advisors in those well understood bodies of knowledge. They need this, and they have it. But what also they must have, and may not have so often, is good family dynamics coaching and family governance assistance. For many advisors, GS 839 is their first introduction to this rapidly changing world. Through this course, you should be able to recognize the issues and talk a bit of the language, even as you continue to serve from your own seat at the planning table.

Answer 105

C) Both I and II The correct answer is C. Both are true. Even when two groups are basically the same, if an experimenter conducting the experiment on human subjects is told Group A is more intelligent than Group B, the results of the experiment are likely to bear out those expectations. It seems that, in human interactions, we tend to live up or live down to the expectations others have of us. In the CAP context, it may be that our client donors are or are not idealistic, depending on what our expectations of them are. Our assuming that they are coldly concerned only with what is in it for them may encourage them to display that attitude and behavior to us. If we assume better of them, we may find them better. That is the Pygmalion Effect, named for the story about the artist who saw a living woman in the statue he had created. Low and behold! The cold stone came to life.

Answer 106

C) Both I and II

Answer 107

C) Both I and II The correct answer is C. There is a world of practical wisdom in Solie's remarks. He has interviewed many high-capacity donors and clients, aged 65-100. He has experienced exactly what he describes. He would agree with Rogers that these elders are healing themselves by telling and retelling their stories until they find the right pattern, the hidden "through line" (as actors call it), the theme of their own life (as literary critics would call it), their own "sense of an ending" (as the critic Frank Kermode called it), their own "organic legacy." Peter Karoff, too, has had this vivid experience with elders, and also people like Bob Buford, making a transition in earlier life. Karoff, trained as a poet, is struck by how, in philanthropy, the process is so much like art. The most private thing (inspiration, life experience, inwardness) becomes the most public gesture, at once personal and for others.

Answer 108

D) Most wealthy heirs are given formal and informal preparation concerning their inheritance The correct answer is D. All are true except that heirs are well-prepared.

Answer 109

D) Philanthropy is a strategic. It is a way of getting results. The correct answer is D. Philanthropy can, indeed, be a way of getting results, as Tom Tierney stresses, but that is not what Peter Karoff is getting at in his evocative remark. He wants us to see that philanthropy, not unlike poetry, is a private gesture in a public setting. That is, in giving we may stand up for and express aspects of ourselves, our deeper commitments, that it may feel inappropriate to bring into a normal business setting. Seldom in business, for example, do we sit around a conference table connecting the client's money with their gender identity, racial identity, cultural identity, political commitments, religious beliefs, or sexual preferences. Yet, those may be the very aspects of the client that they hope to express and stand up for in their giving. It does feel sometimes like the private being expressed in public. There is a moment we, as advisors, may feel shocked, as if rules are being broken by even talking about these such personal things in a business setting. The first few times it happens to you as an advisor, listening as a client becomes passionate about causes you yourself may not support, it can catch you off guard. It is easier on the advisor if the conversation stays businesslike as it does in Give Smart, but if you look at the videos of donors on the Bridgespan site, you will quickly see how passionate and personal and sometimes political and engaged their donor clients are. Some are taking fighting stances in controversial causes. It takes tact, self-control, and diplomacy to do this work well. At times, you may find yourself recalling what Patricia Angus has said about not letting yourself get "triggered." To serve diverse clients well, you must sometimes let your own emotions pass, as she says, like "clouds across the sky."

Answer 110

D) Neither I nor II The correct answer is D. Today this process of creating a giving plan is very much a niche or boutique business. The short list of those who do it might include Tracy Gary, Renata Rafferty, Betsy Brill, TPI, Rockefeller Philanthropy Advisors, Arabella, and a handful of others, including some at community foundations. Very few attorneys or financial advisors provide it as part of a legacy planning or financial planning process. It may be enough, however, for most CAPs to simply point clients to appropriate resources, such as Tracy Gary's book, Renata's book, and the resources at Rockefeller Philanthropy Advisors, Bridgespan, and TPI, and let them do it on their own. That in itself is a service to clients. Or the advisor could refer the client to a community foundation, if creating a gift plan is a service the CF provides.

Answer 111

C) Both I and II The correct answer is C. Both are true. These points are important for advisors who are themselves "self-made." We generally work with clients who are self-made. They, in turn, want their children to "share the family values" of hard work and financial independence. But in reality, the children are in entirely different circumstances. They should develop some financial independence, certainly, but the reality is that they are mutually interconnected via the family trusts, business interests, and shared assets, like the vacation home. Unless they "get along" as financially interdependent, the family may self-destruct.

Answer 112

A) Strategic The correct answer is A. Strategic. Jack is a good example of a donor who is strategic. He is giving in the spirit of Give Smart: Philanthropy that Gets Results. A Repayer sees giving more in ethical terms, doing good deeds in gratitude for benefits received earlier in life. A Grassroots giver could be described as making grants by walking around the neighborhood. There is less strategy and more in the way of direct contact, personal observation, and personal engagement. A social change donor is likely to care about movements, and is looking to catalyze changes in things like voting rights, women's rights, gay and lesbian issues, economic justice. It is less about businesslike management and more about unleashing the energy of self-forming groups.

Answer 113

C) Both I and II C) Both are true. To succeed in the future skills like critical thinking, creative thinking, and high emotional connection to the client are needed. In a prior age, before Google, being able to retrieve facts from memory and to be able to solve problems with right answers was the key to professional success. Now facts can be searched on line and algorithms get better and better at solving standardized problems.

Answer 114

C) Both I and II The correct answer is C. Both are true. Another positive indicator would be a complex family situation.

Answer 115

B) Trust equals credibility, reliability, and intimacy divided by self-orientation. The correct answer is B. The formula is designed to indicate that the advisor's perceived "self-orientation" is lethal to trust. The client cares about the advisor's credibility, reliability, and intimacy, but that is divided by perceived self-orientation. What good are the advisor's strengths, if the advisor is oriented to helping himself or herself more than the client? Self-orientation is not necessarily egotism, vanity, or selfishness. It would include very nice, caring people who are only sitting in front of the client to get something for their organization - including a gift. To avoid the impression of being primarily oriented to self and employer, the gift planner may want to begin by asking about the client before pitching a gift or making a case.

Answer 116

C) Both I and II The correct answer is C. Both are true. Gift solicitation is not generally called "sales," but a straight-up solicitation is very much like what the Fithians call the "sales style" of advisory work. When gift planners are frustrated with advisors killing a gift, they show themselves to be "team-evasive," rather than "team-participative." Often fundraisers do not feel invited to the table, but for a large gift, a fundraiser can ask who else is at the table and whether the fundraiser might play a role.

Answer 117

B) Transform the system of rewards and punishments The correct answer is B. Parker comes out of the civil rights movement. He sees how the system was reset through the social movement, with new laws and new rewards and punishments. He sees a social movement ultimately affecting change, not just through a change of consciousness and a new consensus, but also through new laws enforced by the courts.

Answer 118

A) I only The correct answer is A. He was very successful as leader of Bain Consulting. Unlike Bob Buford, however, he did not "double track," continuing his old job while starting a new nonprofit initiative on the side. Instead, Tom explored his options, quit the old job, and began the nonprofit venture (Bridgespan). It must have taken great courage!

Answer 119

D) Self-Orientation The correct answer is D. The formula says that trust is equal to the sum of Credibility, Reliability, and Intimacy, divided by Self-Orientation. If you work out the math, you will see that the denominator, Self-Orientation, has the greatest impact on the final score. This is a way of saying that the client will not much care how smart you are, how charming you are, and how reliable you are, if he or she feels that it is all about you, your products, or your organization.

Answer 120

C) Both I and II The correct answer is C. The Pygmalion Effect says that people tend to live up to or down to our expectations of them. When advisors say "my clients are not generous," it may mean that the client is living down to the advisor's expectations.

Answer 121

a) I Only The correct answer is A. Aucutt litigates estate plans that lead to lawsuits. He concludes that it is essential for the estate attorney to work to improve communication across the family. Yet, he also acknowledges that it may well be contrary to bar canons. This has led some estate attorneys like James Hughes and Patricia Angus to leave the practice of law, so they can serve an entire family as a trusted counselor.

Answer 122

A) I only The correct answer is A. Advisors tend to be more comfortable and more competent below the line, with tools and techniques, than above the line, with meaning and purpose.

Answer 123

D) Neither I nor II The correct answer is D. Neither seems a good idea. The brochure suggests that such a difficult conversation can have three possible purposes: Inform, Inspire, or Involve. To inform is to make it clear that the donor is making the decision, that the donor has anticipated a sense of loss, and that the decision will be carried out per a clear statement, as, for example, in a video of the donor saying what will happen. To inspire in this case seems unlikely. The heirs do not share an enthusiasm for the cause. To involve seems unlikely, since they are apt to resist any involvement in a controversial gift in which they have no interest. As to the proper location, holding this conversation in the cherished vacation home might only make the heirs more unhappy with its being given away. A business setting might be better. The brochure even suggests that in some cases, the donor may wish to hire a professional convener to break the news and help the heirs process the news.