In New Zealand trusts appear to have become one of the great “self help” areas of our society. In our opinion Trusts are a “minefield” and it is only a question of time before the mines get trampled on.
Despite public advertising to the contrary the establishment and management of trusts is an area of law and accounting that is fraught with risk and therefore misunderstood by many people. The creation of a trust provides an extremely useful asset ownership vehicle for transitioning assets from one generation to the next and at the same time providing protection to those persons (the settlors) who transferred or sold assets to the trust in the first instance.
The accounting requirements and legal obligations on the trustees that result from establishing a trust are not for the fainthearted. We anticipate a good deal of litigation as beneficiaries of trusts challenge the actions of trustees, particularly regarding investment decisions, following the deaths of the original settlors (often parents).
At KGA we have a specialist trust group that can assist you with effectively managing your trust in order to minimise risk. We also ensure that trust accounting is in accordance with the latest current practice, again, in order to ensure that the trust is managed and operated on a robust basis.
