California law requires attorneys who handle client funds or funds entrusted by others to hold them in one or more interest-bearing bank accounts labeled as a "Trust Account," or words of similar import.

The trustee of a California trust has a duty to keep beneficiaries reasonably informed of the trust and its administration. The trustee must also account to all current income or principal beneficiaries (1) at least annually, (2) upon the termination of a trust, or (3) upon a change in trustee.

Trustees must maintain separate accounts for each trust, with each client's funds handled individually. Detailed Record-Keeping: Every financial transaction involving the trust must be meticulously recorded. This includes deposits, disbursements, interest income, investment gains, and expenses.

What Should a Trust Accounting Include? An account statement with all principal and income held by the trust. A detailed breakdown of assets/liabilities. Trustee compensation. A report of the agents a trustee hired. A legal statement that beneficiaries can object to the trust accounting.

Contact Center Our hours of operation are a.m. to p.m., Monday through Friday, to accommodate this improvement. The Contact Center is closed on State Bar holidays. To speak with a representative, please call 800-843-9053 if you are in California.

You must keep a written record showing that every month you completed a three-way reconciliation where you “reconciled” or balanced the account journal against the individual ledgers and the bank statement with canceled checks. You must perform this three-way reconciliation for each client trust account you keep.

Per California probate code section 16063, an accounting should include the following information for the last fiscal year of the trust or the time since a trustee last prepared and provided an accounting: A statement of all receipts and disbursements of principal and income. A statement of assets and liabilities.

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The trust accounting handbook is a practical guide created to assist attorneys to comply with recordkeeping standards for client trust accounts. The handbook is currently only available online.Under Rule 1.15, California attorneys are required to maintain sufficient records to track how much money is held for each client at all times. Trust Fund Resources. In this guide, we will explore the importance of client trust accounts and provide an overview of how you should set up and maintain them. While not required, the simplest and safest thing to do is to hold advance fees in your client trust bank account and draw them out as you earn them.

State Bar Of California Handbook On Client Trust Accounting In San Jose

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