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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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