Haw. Prob. R. 26
All accountings to the court shall be typewritten or prepared by computer and presented by petition, and shall include in the petition for a trust or conservatorship proceeding a brief description of the operations and holdings of the trust or estate during the period of the accounting and a list of the names and addresses of the current beneficiaries according to the fiduciary's records. Attached to the petition in all accountings shall be a complete financial accounting for the period of accounting, including in order (1) a brief summary at the beginning of the attachment summarizing receipts and disbursements during the accounting period, (2) a list of the assets of the trust or estate at the end of the accounting period, including its value for administration purposes (the inventory value for probate accountings and the current fair market value for all other accountings), (3) a summary explaining the amount and basis of fiduciary fees taken or charged during the accounting period, (4) a detailed accounting of the transactions of the trust or estate during the accounting period, and (5) a copy of any auditor's report and auditor's management letter received by the trust or estate during or with respect to the accounting period. In addition, trust accountings shall include as an exhibit once every five calendar years a copy of the controlling trust documents. The detailed accounting of transactions may summarize regular and minor transactions and transactions that are internal to the accounting system being used, with a goal of eliminating needless detail and making the accounting easier to understand, while presenting sufficient information to understand and track the transactions of the trust or estate.
Haw. Prob. R. 26
COMMENTARY:
This rule is partially the result of concerns raised by the First Circuit Court and discussed by an ad hoc committee composed of attorneys, accountants, masters, the attorney general's office, and all Hawai'i trust companies in the fall of 1991. No agreement was reached by that committee as to any one form of accounting, but the need for the element described in items (1)-(5) of the rule were believed important. This rule does not mandate any form of detailed accounting, leaving that to the fiduciary's discretion. By requiring the additional exhibits (1)-(3) and any auditor's reports, the precise form of the accounting is less important; the summary sheets will provide the information at a glance that most interested parties want, while the detailed accounting is available for those wishing to delve into the minutiae of the detailed transactions. This rule attempts to achieve a balance between that detail and ease of understanding.
This rule will result in greater work for fiduciaries in producing the additional pages required by (1)-(3), but those are anticipated to be only a few pages in length, and the added time and cost to produce them should be offset by the time and cost saved in challenges raised because a beneficiary cannot understand all of the detail.
Of great concern to the First Circuit Court and the committee in 1991 was decreasing the amount of paper circulated with an accounting. A suggestion was that the fiduciary file with the court only the summaries of (1)-(3) and any auditor's reports under (5), retaining the detailed accounting and giving it only to the master, attorney general, and any other interested party who requested it. Masters and the attorney general's office objected to any accounting system that did not provide a full and complete copy of the detailed accounting to them; the trust companies objected to not providing the detailed accounting to the court, because the trust companies rely on the court records for storage and do not save all detailed accountings in their own records. No consensus was reached by the committee, therefore, on the content of the accounting filed with the court and presented to beneficiaries.The requirement for a copy of the controlling trust documents once every five calendar years is adopted in recognition that trust accountings can sometimes be quite lengthy and over time fill many volumes of files. By having copies of the controlling documents filed on a regular basis, the court and interested persons will not have to dig back too deeply in the files to locate the controlling documents.