Trust Accounting vs. Trust Information: Which Is Better?

The Quick Answer: A Formal Trust Accounting Offers More Protection for Beneficiaries Than General Trust “Information”

If you're a beneficiary of a California trust, you may have received either a formal trust accounting or a general information letter. While both can provide insight into trust activity, they are not equal under the law. A court-compliant trust accounting gives beneficiaries more legal rights and transparency, while general “trust information” may be vague, informal, or incomplete.

At Moravec, Varga & Mooney, we advise beneficiaries on how to evaluate what they’ve received—and we help them compel formal accountings when necessary to protect their inheritance.

What Is a Formal Trust Accounting?

A trust accounting is a comprehensive, legally compliant financial report that shows how a trustee has handled the trust assets.

Under California Probate Code §16062, trustees must provide accountings:

• At least once per year

• When requested by a beneficiary

• Upon trustee resignation or removal

• When the trust terminates

A proper accounting includes:

• Beginning and ending asset balances

• Detailed lists of receipts and disbursements

• Gains and losses

• Trustee compensation and legal fees

• A narrative summary of trust activity

Accountings are often subject to judicial review, giving beneficiaries the opportunity to object if anything looks suspicious.

What Is Trust “Information”?

Under Probate Code §16060, trustees are required to keep beneficiaries reasonably informed. This is known as the “duty to inform.” However, this duty can be satisfied by simply providing:

• A summary of trust assets

• Updates on sales or transfers

• Copies of trust documents or amendments

• Letters discussing trust goals or changes

This is not the same as a formal accounting and often lacks detailed numbers, timelines, or supporting documents.

Why Formal Accountings Offer More Protection

A formal trust accounting is better for beneficiaries because:

• It creates a clear record of all financial activity

• It allows beneficiaries to spot red flags, like unexplained withdrawals or self-dealing

• It triggers a statute of limitations for filing objections (typically 3 years from the date of accounting)

• It provides a foundation for surcharge claims if the trustee caused financial harm

By contrast, vague or informal trust updates leave too much room for abuse.

When Should You Demand a Formal Accounting?

You should request a court-compliant accounting if:

• You haven’t received one in over a year

• You suspect mismanagement or self-dealing

• The trustee refuses to communicate

• You’re being told the trust has “no money,” but no details are given

• The trust is about to be distributed or terminated without full records

You have the right to file a petition in probate court to compel an accounting.

What Trustees Need to Know

If you’re a trustee, providing only informal updates is not enough. Failing to provide a proper accounting can:

• Lead to court sanctions

• Expose you to personal liability

• Result in removal as trustee

• Undermine your defense in a dispute

If you’re unsure how to prepare a formal accounting, our attorneys can guide you—or connect you with a CPA or fiduciary accountant.

Get the Full Picture—Not Just Pieces

If you’ve been kept in the dark or handed vague financial updates from a trustee, don’t settle for less than your legal rights allow. At Moravec, Varga & Mooney, we help trust beneficiaries across California compel formal accountings and uncover the truth.

📞 Schedule a consultation to demand the transparency you deserve.