Financial Trustee Service Considerations

A financial trustee is a person or firm who manages property or assets on behalf of a third party. One may be appointed for various reasons, including, but not limited to, settlements, litigation, bankruptcy, environmental remediation or charitable funds. A financial trustee has a fiduciary duty of loyalty to the trust and its beneficiaries, and also a duty of impartiality to the beneficiaries. It’s essential that the day-to-day activities of the trust are properly managed and monitored to ensure the objectives and obligations of the trust are achieved.

Examples of services that a financial trustee may provide are:

Trust Establishment

• Establish one or more bank accounts with approved financial institutions
• Determine appropriate accounting methods
• Develop a record retention system to maintain complete and accurate records
• Create policies and procedures for day-to-day operations to meet individual needs of the trust

Trust Administration

• Receive invoices and manage the invoice approval process prior to remitting payment
• Direct cash receipts and disbursements
• Manage cash flows to ensure sufficient liquidity to meet anticipated needs of the trust
• Manage and invest assets of the trust
• Maintain records of all actions and communication with respect to the trust
• Make, execute, acknowledge and deliver contracts or agreements related to the trust

Financial Reporting & Tax Preparation

• Prepare and distribute monthly, quarterly and annual financial statements
• Prepare monthly bank reconciliations
• Prepare customized reporting for legal, governmental agency (i.e. Environmental Protection Agency) or other reporting purposes
• Plan for and prepare annual federal and state tax returns

For more information on Schneider Downs’ financial trust and fiduciary service capabilities contact Joel Rosenthal at 412.697.5387 or [email protected] or Alyssa Brunatti at 412.697.5371 or [email protected]. For similar articles, visit the Our Thoughts On blog.