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GAZETTE
JULY/AUGUS
T
1982
Administration Record.
13. Report to client on sources and application of
assets.
Having analysed the various activities involved, it
is suggested that by the use of a systematic method of
keeping records, considerable improvements in
efficiency may be achieved.
Keeping of Adequate Records
It is suggesed that a General Correspondence File
be opened in the normal way, supplemented by a
"Lodgments File" and two documents folders,
entitled "Tax Documents Folder" and "Probate and
Title Documents Folder".
The folder entitled Lodgments File is to be open-
ed when the first cash is collected to accumulate,
in date sequence, the letters or dockets covering all
lodgments to the solicitor's Client Bank Account and
the executors' or administrators' Bank Account, the
Lodgment File will avoid the confusion and extra
work which arise, for example, where there is no
record of several sources which make up a composite
lodgment, or where a net receipt is noted but there is
no record of the gross funds originally received. This
in date order file obviates the need for a separate
journal or cash book and enables easy reconciliation
of bank statements.
It may be advisable to open a separate file for
material relating to continuing Estate income and the
accounting for Income Tax thereon.
The Tax Documents Folder will contain copies
of all tax returns — in practice, mostly those re-
lating to Capital Taxes handled by the solicitor
including various communications from the
Revenue, such as Queries, Observations, Receipts
and Discharges. Its purpose is to marshal at one point
all material relating to the valuation of property, the
size of gifts, inheritances and other disposals, and
assessments of tax, in order to help the solicitor in his
negotiations with the Revenue and so that he can
check with ease what receipts and discharges have
been issued.
The Probate and Title Documents Folder would,
prior to the extraction of the Grant, hold draft
probate documents and any title documents, Irish
and foreign, such as Stock and Shares certificates,
deposit account pass books, Insurance policies, Prize
Bonds and title deeds.
Foreign Probates or their equivalent normally
require sealed and certified copies of an originating
Irish Grant as a base for applications. Jointly owned
assets, insurance policies and some pension schemes
require death certificates as a proof of death. Foreign
countries, such as South Africa, Australia, U.S.A.
and Malaysia have their own tax clearance documents
to be completed before permission to transfer can be
obtained. In other cases, where the value is relatively
small and the title clear, the institution holding an
asset may agree to release it upon the execution of an
indemnity and the furnishing of a letter of clearance
from the Revenue.
As soon as the title of the personal representative
has been established by obtaining the Grant (or
alternative title document), the Probate and Title
Documents Folder should have added to it all
documents that have to be exhibited and noted by
registrars before the title of the personal representa-
tive can be registered, including copies of Grants,
Irish and foreign; death certificates; indemnities;
letters of clearance from Irish and foreign Revenue
authorities; insurance policies; bank and building
society pass books, withdrawal forms, and pay
orders; stock and shares certificates and transfers or
letters of request for registration.
These are all documents that have to be "sent out"
before the assets concerned can be collected. Accord-
ingly it is convenient to group them together. They
act as visible reminders of what is outstanding. If
there is in this Folder a spare copy of the Grant and a
share certificate still in the name of the deceased,
these documents should be sent out without delay
and not left lying in the Folder.
Bills Payable
Where there are liabilities to be discharged when
assets are realised, it may be convenient to collect all
bills in the Probate and Title Documents Folder,
because these bills must also be "sent out" with
cheques as soon as funds are available.
Coding of Files
For ease of identification of files and folders,
separate colours of File covers may be used for each
category, e.g. General Correspondence — buff,
Lodgment file —blue, Probate and Title Documents
Folder — pink, Tax Documents Folder — green.
The Administration Record
In addition to the separate Files and Records
Folders, it is suggested that, an Administration
Record be set and maintained. The Administration
Record is the kernal of the operation of the system. It
enables a person coming fresh to the case, or coming
back to the case after an absence to see, at a glance,
exactly how far the various steps have progressed. It
should contain:
(a) an Epitome of reference information, structured
to tell in simple profile who and what is involved
— particulars of all groups of assets, who is
entitled to and who manages them; and the
names of professional advisers, accountants and
stockbrokers.
(b) a Check List, that in turn enables the preparation
of
(c) a Chart listing the main Documents to be
processed (Probates, Exchange Control
Permission, etc.), and the sequence of stages by
which each is to be progressed —drafted, signed,
lodged, etc.;
(d) the three final sections of the Administration
Record are (i) the Assets Account which
describes the assets and records how and when
they are collected and (ii) Debt and Legacy
accounts, which list debts and legacies and how
they are discharged, thus enabling an ongoing
Balance Sheet to be maintained.
The use of the Administration Record greatly
facilitates the winding up of Estates and Trusts,
because so many of the activities involved are pre-
dictable and "plannable". When the Schedule of
Assets is prepared, a list of the persons involved
(settlor, per reps, beneficiaries, creditors) and the
opening Balance Sheet items and values are all avail-
able. It is this stage, that the Administration Record
should be first written up. Later, it will save an
enormous amount of time that would otherwise be
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