California law imposes specific accounting obligations on trustees and personal representatives. Under Probate Code §16060 and the related sections, a trustee must keep the beneficiaries reasonably informed and provide a formal account at intervals or upon request. Probate Code §1060 governs the form of every accounting filed with the court. The rules are technical, the formats are unforgiving, and the consequences of a defective accounting can include personal liability and surcharge against the fiduciary.
Our practice covers both sides of the accounting question. We prepare and defend accountings on behalf of professional and family trustees who are doing the work correctly and need a clean document to demonstrate that fact. We also represent beneficiaries who have received an accounting—or have not received one they were entitled to—and who need to evaluate the fiduciary's conduct.
What an accounting actually contains
A California fiduciary accounting is structured by statute. It includes a summary, schedules of receipts and disbursements, schedules of gains and losses on sale, distributions to beneficiaries, fiduciary and attorney compensation, and a closing statement of assets on hand at the end of the period. Each schedule cross-references the supporting transactions; each transaction is anchored in a brokerage statement, bank record, or trust authority. A defective schedule is not just a presentation issue—it is grounds for objection.
Where the trust holds operating assets—rental real estate, an operating business, a partnership interest—the accounting must capture both the cash flow and the principal-and-income allocations that the California Uniform Principal and Income Act prescribes. A capital-improvement expenditure miscategorized as an income expense produces an income beneficiary credited too generously and a remainder beneficiary undercredited—each a basis for surcharge.
Preparing accountings for trustees
For trustee clients, our work begins well before the formal accounting is needed. We design the recordkeeping framework at the front of the administration, advise on how to coordinate with the outside CPA who prepares the trust's tax returns, and review draft schedules before they are circulated to beneficiaries. Where the trust has been administered for years without a formal accounting— a common situation in long-running family trusts—we reconstruct the period from primary records and prepare a ratification-ready accounting that closes prior years.
Approval, ratification, and the limitations period
California gives a trustee meaningful protection when an accounting has been served on a beneficiary in proper form. Once the statutory disclosures are made, beneficiaries generally have three years to object to items disclosed in the accounting. Items not disclosed do not start the clock. A poorly drafted accounting therefore protects the trustee much less than it appears to. We draft accountings that disclose enough to start the period running on every transaction the fiduciary wants closed.
Representing beneficiaries
On the other side of the table, we represent beneficiaries who have concerns about the fiduciary's conduct. Common patterns include long delays between accountings, distributions that do not match the trust's terms, fiduciary fees that exceed reasonable compensation, related-party transactions that were not disclosed, and capital improvements financed from income. The first step is always a careful review of the accounting against the underlying records—work we do regularly and quickly.
Where the review identifies legitimate concerns, we draft formal objections and pursue them in probate court. Where the concerns are unfounded, we say so and counsel the beneficiary to ratify the accounting. Beneficiaries are best served by a candid evaluation, not a reflexive contest.
Court accountings and contested matters
Some accountings must be filed with the court—accountings in formal probate, accountings of conservatorships, accountings of guardianships, and accountings of trusts under court supervision. These follow §1060's specific format and require sworn verification. Where objections are filed, the matter proceeds as a probate court trial, often with expert testimony on principal and income, fiduciary compensation, or specific transactions in dispute.
A successor trustee took over a long-administered family trust where no formal accounting had been served on the income or remainder beneficiaries in over twelve years. We reconstructed each year from brokerage statements, tax returns, and the predecessor's records, prepared a single comprehensive accounting covering the entire period, and obtained ratification from each beneficiary. The successor trustee began the new administration with a clean closing balance and full statutory protection for everything that came before.
Whether you are a trustee preparing to account, a successor cleaning up an inherited administration, or a beneficiary evaluating an accounting you have received, we are available to review the matter and advise on the appropriate path.