Using Fiduciary Accountings as a Client Management Tool

178406759When representing a fiduciary such as a conservator or personal representative, you’re often dealing with a lay person who may be feeling overwhelmed by unfamiliar responsibilities. One way to bring the situation under control is to use the fiduciary accounting as a client management tool. Here’s how.

Start early. You may want to encourage your fiduciary clients to begin preparing their accountings far in advance of the date the account period ends. Starting early has many benefits:

  • it helps guardians, conservators, and personal representatives identify any assets inadvertently omitted from their inventories,
  • it helps trustees identify the assets comprising the trust estate,
  • it helps the fiduciary understand which records are necessary for the preparation of the accounting and thus leads the fiduciary to keep good records.

If you examine the fiduciary’s accounting (for example, after 6 months of the fiduciary’s administration), you may identify actions the fiduciary should curtail and breaches that may be remedied. This practice also alerts the fiduciary to just how carefully his or her actions may be scrutinized.

Schedule face-to-face meetings. Meeting with fiduciary clients personally strengthens the client relationship and will elevate the client’s commitment to the project. Consider scheduling a series of meetings, with well-defined deliverables due at each.

  • At the first meeting, early in the attorney-client relationship, get the information necessary to prepare the inventory (or for fiduciaries who report to the court, the schedule Assets on Hand—Beginning of Period).
  • At the second meeting, you might examine the fiduciary’s record-keeping system and show the fiduciary a sample accounting. At this meeting, the fiduciary might decide to hire assistance with the accounting, but if the fiduciary is determined to prepare his or her own accounting, you might want to schedule a third meeting.
  • At a third meeting, you can evaluate the fiduciary’s progress on the accounting and, if advisable, again recommend hiring someone to help prepare the accounting.

For a step-by-step, schedule-by-schedule guide to preparing periodic accountings, turn to CEB’s Fiduciary Accounting Handbook.

Other CEBblog™ posts you may find useful:

© The Regents of the University of California, 2015. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.

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