Accounts by Guardians of the Property of a Minor
THE GUARDIANSHIP ACCOUNTS
Please state your accounts in a legible manner. If the account is typed, font size not less than 10 point is required, otherwise the account may be returned to be restated.
An account is a report to the Commissioner of Accounts of all financial transactions conducted by the guardian during the period of the guardian’s appointment by the Clerk or the Court. It is an item by item, penny for penny account of all receipts, all disbursements, and all distributions. You are encouraged to keep every piece of paper associated with transactions which you conduct on behalf of the minor. You will be required to produce many of those documents to the Commissioner of Accounts and may find those documents helpful in balancing your account before it is submitted to the Commissioner’s office.
THE ACCOUNT FORM
The proper form for the account required by the Commissioner of Accounts from a guardian is Form CC-1683. This form shall be used by the guardian reporting all financial transactions to the Commissioner’s office. Failure to use this form will result in the return of the accounting to you to be resubmitted on the appropriate form. This form was given to you at the time of your qualification as guardian before the Clerk of the Circuit Court. Form CC-1683 (INST), also given to you at qualification, gives a clear and accurate description of how you should account for all of your transactions and all of the assets of the minor which have come under your control.
Additionally, you were given Form CC-1683 (SAMP). This form is a sample of account and shows you the form which should be used for reporting all of the information required on the account summary.
Note that the accounting is not complete with just the account summary page. You shall submit with the accounting individual pages itemizing the various line items shown on the account summary. For instance, you should attach a page showing beginning assets and list all of those beginning assets from your inventory or prior accounts showing the total on line 1 of the account. You should likewise attach a page itemizing by date, payor, and amount all income received or disbursements made during the accounting period.
Line 1. Beginning Assets.
List the beginning assets from the inventory or the ending assets from the prior account if this is a second or subsequent account. Do not add additional principal assets received since the inventory was filed. Such additional principal assets will be listed on line 4.
Line 2. Receipts.
Line 2 reports the total of all receipts on behalf of the minor except as hereafter noted. Receipts would include bank account and certificate of deposit interest, stock dividends and capital gains, annuity payments and non-governmental monthly payments such as structured settlement or other monthly payments..
A total on the account summary with nothing more is insufficient. You must attach an itemized listing by date, payor, source and amount of each and every receipt. The total of the itemized listing is entered on Line 2.
Note: There is an asterisk beside line 2. At the bottom left of the account summary you will see a line for the entry of receipts from governmental agencies as Representative Payee. If, and only if, you are the designated payee of these benefits you are only required to report the total amount received during any accounting year and the total will not be included in the Grand Total following Line 4. You may have to present to the Commissioner, with your account, your designation as Representative Payee. You are not required to account to the Commissioner of Accounts for the receipt and use of those funds. Since you are making a report on an annual basis to the federal agency providing those benefits, that report is considered sufficient. However, if you have not been designated as the Representative Payee and the check comes in the name of the minor or is directly deposited to a minor’s account without designation of a representative payee, these funds shall be reported and accounted for to the Commissioner of Accounts on line 2 of the account.
Additionally, if you have comingled the governmental receipts with all other receipts without mantaining a separate bank account for the governmental receipts you will have to report those governmental receipts on Line 2 or you will be unable to balance your account and the Commissioner’s office will be unable to follow your documentation as it will not match your account.
Line 3. Gains on Asset Sales.
Line 3 on the account summary shows any gains from the carrying value shown on the inventory that were realized from the disposition of any asset. For example, if you owned 50 shares of ABC stock at the time you qualified and those shares were worth $100.00 per share for a total of $5,000.00 and you disposed of those shares at $200.00 per share, a gain of $5,000.00 would be shown on an attached itemized page listing all gains. The total of all gains will be shown on line 3 of the account summary. The same would be true with real estate sold with the approval of the Commissioner’s office.
Line 4. Adjustments.
Line 4 will give you the opportunity to adjust the account to add principal paid to the minor after the inventory was filed or delete items from the inventory which were incorrectly shown. Many times assets are received after the four-month period within which the inventory is due and you may add those additional assets under line 4 itemizing them on an attached page. The total of those adjustments, increases and/or decreases, will be shown on line 4 of the account.
Line 5. Disbursements for Administrative Expenses.
Line 5 shows disbursements for administrative expenses. A separate page will be prepared which itemizes all costs of administration. Costs of administration are those expenses you have incurred as a result of serving as the guardian. They include surety bond costs, fees paid to the Commissioner of Accounts or Court and commissions taken by the guardian. They are itemized by date, payee and amount. This category is very important and must have an invoice for each bill paid, a cancelled check or photocopy of a check included in your monthly bank statement, or a signed notarized receipt for each disbursement made from the estate. Any disbursements which you list that you cannot substantiate as stated above will be disallowed, and you will be required to pay those sums back to the minor’s estate.
Line 6. Disbursements for Care of the Minor.
Line 6 is for disbursements for the care of the minor. If the minor has no living parent, the income and principal as necessary when considered with the other resources available to the minor (including social security or payments from any other government agency) will be individually listed and the same documentation referenced under section 5 will be required in order to obtain approval from the Commissioner of Accounts.
In the event a parent is living there should be no disbursements for the care of the minor shown unless those disbursements have been approved in advance by an Order entered by the Court; or pre-approved by the Commissioner of Accounts on a petition submitted to the Commissioner and hearing by the Commissioner approving the disbursement of sums not to exceed $5,000.00 annually for the care of the minor.
Line 7. Losses on Asset Sales.
Line 7 discloses losses on the sale of any of the minor’s assets. As with gains on the disposition of any asset if the disposition results in a loss it is reflected on Line 7. If 100 shares of ABC stock valued at $100.00 per share on the inventory for a total of $10,000.00 were sold for $50.00 per share, the resulting loss of $5,000.00 would be reflected on line 7. An attached page listing and explaining the losses shall be included with the account.
Line 8. Distributions.
Line 8 shows any distributions to the minor. From account to account there will be no distributions until such time as the minor turns age 18 and final distribution of the remaining proceeds, income and principal, are made to the minor (now an adult). On the final account when distributions are made, verification of that distribution shall be provided by the guardian. This distribution shall be shown by cancelled check endorsed by the minor (now an adult) or by a signed notarized receipt by the minor (an adult) acknowledging receipt of the assets or the money distributed.
Line 9. Assets on Hand.
Line 9 reports assets on hand at the end of the accounting period. List each and every asset held by you showing its carrying value and also showing its market value at the end of the account. Please remember not to adjust the carrying value of assets based upon a change in market value. For accounting purposes, for your account to balance, unless you have disposed of that asset during the accounting period, you should continue to use the initial carrying value entered on the inventory on each subsequent account until the asset has been disposed of. You will be required to show evidence of the assets on hand at the end of each accounting period. Institutional statements for the entire period of the account will provide that evidence.
Along with the documentation for all disbursements and distributions, you will be required to provide copies of all bank statements during the accounting period, all stock brokerage statements and/or stock sales transaction reports.
If the bank account you have opened does not return photocopies of the checks drawn on the account with the bank statement, you should change the account to provide that service. Otherwise, the Commissioner’s office will require that you obtain copies of the front and back of all checks which will result in a delay in the audit of your account as well as additional expense to the estate to obtain individual copies of checks.
Please remember that the bank account maintained for cash assets of the guardianship must be interest-bearing.
THE ACCOUNTING PERIODS AND FILING DATES FOR GUARDIANSHIP ACCOUNTS
The first guardianship account is for the period of four (4) months following the qualification of the guardian, and is to be filed with the Commissioner of Accoumts within six (6) months of qualification. The account period should not be extended beyond four (4) months except to coincide with the ending date of the guardianship bank account statement for ease of accounting.
Second and subsequent guardianship accounts will be filed for each successive twelve (12) month period. Each account is filed within sixteen (16) months of the ending date of the prior account. Do not extend the twelve (12) month accounting period. If you do so, the account may be returned to be restated for a twelve (12) month period only.
Fees of the Commissioner of Accounts and Clerk of Court
Based on assets from inventory or prior account at market value, plus additions (receipts, capital gains and adjustments):
Commissioner’s Fees for First Account:
0 – $50,000 $135.00
50,001 – 100,000 $220.00
100,001 – 200,000 $275.00
200,001 – 300,000 $350.00
300,001 – 500,000 $400.00
500,001 – 700,000 $475.00
700,001 – 1,000,000 $550.00
Above 1,000,000 $550.00 plus .0005 in excess of $1,000,000
+ 5.00 Mailing
Second and Subsequent Accounts of a Minor:
The fee shall be determined by applying the fee schedule for a First Account to the assets, brought forward (at market value) plus additions (receipts, capital gains and adjustments (lines 2b, 3 and 4).
Fees of the Clerk of Court:
1-10 pages $18.00
11-30 pages 32.00
31 and over 52.00
One check for the commissioner’s fee and the clerk of court’s fee shall be written to the commissioner of accounts.