Estate accounts- help is at hand!
Estate accounts. Not the most exciting subject and one that makes many private client lawyers’ hearts sink. Quite possibly, one of the reasons for this is fear. After all, we are trained in law not accountancy and while we might be able to write a will or apply for a grant with relative ease, preparing estate accounts is not our natural domain. However, the importance of estate accounts should not be underestimated.
Recent figures show that £23,800 million was paid out by the SRA’s compensation fund in the year to 31st October 2014. This was to compensate clients who have lost out financially as a result of money not being accounted for or misappropriated by solicitors and probate is one of the activities against which Compensation Fund payments were made.
Correctly completed estate accounts give an accurate picture of how an estate is made up and what has happened to the funds. This can prove an invaluable tool in ensuring that funds are accounted for correctly and can be used to answer any queries that might be raised by beneficiaries or others on their behalf after the completion of the administration. Indeed, the SRA will request a copy of the most recent estate accounts in the event of a complaint by a beneficiary that they are owed money from an estate. Completion of estate accounts can also provide personal representatives with the peace of mind that they have complied with the statutory duties that they have under in section 25 of the Administration of Estates Act 1925:
“The personal representative of a deceased person shall be under a duty to–
(a)collect and get in the real and personal estate of the deceased and administer it according to law;
(b)when required to do so by the court, exhibit on oath in the court a full inventory of the estate and when so required render an account of the administration of the estate to the court.”
It is clearly in everyone’s interests whether they are advisers, personal representatives or beneficiaries to have accurate estate accounts completed. However, there are no set rules to say what form estate accounts should take. Additionally, there are often ‘quirky’ amendments and adjustments that need making which can be off putting and confusing to the non-accountancy minded among us. It is no wonder that many of us put off this important task. So, do we attempt them ourselves or pass over the work to our accountant contacts? Is there anything that can be done to help? Mark Vickers is a trained and qualified Chartered Accountant who has much experience in teaching probate practitioners how to complete estate accounts with confidence. This course demystifies estate account preparation and gives highly practical advice and tips. Please see http://www.clt.co.uk/course/producing-estate-accounts-made-simple-a-workshop/ for more details.
This article was submitted to be published by Central Law Training as part of their advertising agreement with Today’s Wills & Probate. The views expressed in this article are those of the submitter and not those of Today’s Wills & Probate.