CPG Record Keeping 2 — Questions and Answers
Question 1: How long must a guardian typically retain financial records after a guardianship is closed?
- 1 year
- 3 years
- 7 years (Correct answer)
- 10 years
Correct answer: 7 years
Most jurisdictions require guardians to retain financial records for at least 7 years after guardianship closure to allow for audits or legal review.
Question 2: When a guardian receives cash on behalf of a ward, the best practice is to:
- Hold the cash in a personal wallet for safekeeping
- Deposit it into the ward's account within 2-3 business days and document the deposit (Correct answer)
- Convert it to a money order before recording it
- Report it only in the annual accounting
Correct answer: Deposit it into the ward's account within 2-3 business days and document the deposit
Prompt deposit and documentation prevents commingling, establishes a clear audit trail, and protects the guardian from allegations of misappropriation.
Question 3: A guardian's inventory submitted to the court at the start of guardianship should include:
- Only real property owned by the ward
- All assets, liabilities, and their fair market values as of the guardianship start date (Correct answer)
- Assets the guardian expects the ward to acquire in the next year
- Only liquid assets above $1,000
Correct answer: All assets, liabilities, and their fair market values as of the guardianship start date
The opening inventory must capture a complete financial snapshot of the ward's estate at inception, including all assets and known liabilities at current market value.
Question 4: Which document type provides the strongest legal evidence that a guardian obtained court approval before making a major expenditure?
- A guardian's personal note in the case file
- A signed court order authorizing the expenditure (Correct answer)
- An email from the ward's attorney
- A verbal confirmation from the judge
Correct answer: A signed court order authorizing the expenditure
A signed court order is the definitive legal authorization; verbal or informal approvals carry no enforceable weight.
Question 5: A guardian discovers a receipting error where $500 was recorded as $50. The correct corrective action is to:
- Erase the original entry and write the correct amount
- Void the original entry with a dated notation and create a corrected entry (Correct answer)
- Leave the error to avoid appearing to alter records
- Correct it only in the next annual accounting
Correct answer: Void the original entry with a dated notation and create a corrected entry
Proper bookkeeping requires voiding incorrect entries with a clear dated notation and recording a corrected entry to maintain an accurate and transparent audit trail.
Question 6: Under the Uniform Guardianship, Conservatorship, and Other Protective Arrangements Act (UGCOPAA), conservators must file accountings:
- Only when requested by the ward
- At least annually unless the court orders otherwise (Correct answer)
- Every two years
- Only upon termination of the conservatorship
Correct answer: At least annually unless the court orders otherwise
UGCOPAA requires conservators to file annual accountings with the court to ensure ongoing oversight of the ward's estate management.
Question 7: What is the purpose of maintaining a receipts-and-disbursements ledger separate from the guardian's own finances?
- To simplify the guardian's personal tax filing
- To prevent commingling of funds and demonstrate fiduciary integrity (Correct answer)
- To allow the ward to access their own accounts directly
- To satisfy a requirement only applicable to corporate guardians
Correct answer: To prevent commingling of funds and demonstrate fiduciary integrity
Keeping separate ledgers prevents commingling, which is a serious fiduciary breach, and provides clear documentation that all ward funds were managed solely for the ward's benefit.
CPG Record Keeping 2
How long must a guardian typically retain financial records after a guardianship is closed?