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A trust balance sheet format is the best way to summarize and represent a trust’s financial balances to its stakeholders.
What is Trust?
A trust is a legal and fiduciary relationship where the grantor
(holder of rights) assigns the right to hold title to assets and property to the trustee (beneficiary)
for their benefit. It provides legal protection to the donor’s assets while ensuring that the
distribution is done according to their wishes.
Anyone can create a trust for many purposes, like providing for the
well-being of a minor, for religious or charitable purposes, and providing medical aid to the author.
However, The Indian Trusts Act 1882 specifically states that a person cannot create a trust for an
Types of Trusts
Although there are various types of trusts, each fits into one or more of the
A Living or sometimes known as Inter Vivos Trust, is a written legal document in which an
individual’s assets are placed into a trust for their use and benefit during their lifetime.
Later, these assets get transferred to the beneficiaries in the event of that individual’s
A testamentary trust, otherwise known as a will trust, is a trust which arises upon the
death of the testator and specifies the instructions about how the trustee will designate
the assets after the testator’s death.
A revocable trust is a testament that can be changed or terminated while the grantor is
still alive. It is a legal document that places the trustor’s assets and property into the
trust during their lifetime and distributes them to the heirs or beneficiaries after their
As the name indicates, an irrevocable trust is one that the grantor cannot change, alter,
modify, or terminate once the trust deed is signed and established. Once transferred to the
trust, the trustor cannot exercise control over assets or property.
A funded trust has different assets, including stocks, cash, bonds, and properties put into
it by the grantor during its lifetime. The three parties of the trust deed are the grantor,
the beneficiary, and the trustee.
An unfunded trust is merely a trust agreement with no funding, and it can become funded
after the trustor’s death; otherwise, they remain unfunded. An unfunded trust exposes assets
and property to risks that trust can avoid; thus, proper funding is essential.
Trust Balance Sheet Format in Excel
Trust Balance Sheet Format in Word
Trust Balance Sheet Format in PDF
Trust Balance Sheet Format in Google Docs
Trust Balance Sheet Format in Google Sheets
With the automated trust bookkeeping feature of the Vyapar App, you gain instant access
to your trust’s financial health. You can track results by setting standards and
comparing them with actual results. Thus, you will get a better picture of your trust’s
overall performance, which will help in decision-making.
Easier Financial Calculations
It is challenging and frustrating to manage accounts on a spreadsheet. Trust Balance
Sheet Format by Vyapar makes trust accounting and reconciliations painless and
straightforward. The automated accounting software helps with
complex calculations and issues.
Better management of cash flow
The Vyapar trust balance sheet maker app provides you with real-time insights and better
control over the trust’s cash flow. Cash flow is an essential part of accounting as it
helps you plan small and large expenses and ensures that you have enough funds to
maintain ongoing trust requirements.
Saves Time and Efforts
The manual process is time-consuming and increases the likelihood of errors and mistakes
in calculations. You can bypass this issue by opting for the trust balance sheet format
by the Vyapar app, and it automatically performs all calculations correctly. With the
easy bookkeeping app to manage the trust, you can save time.
the client’s property belongings
Deposit checks and cash in the bank punctually. If you cannot get them deposited in your
bank, lock up deposits that you receive at the end of the day. Ensure that you employ
up-to-date virus protection and use two-factor authentication or a unique, robust password
for online banking.
Delegate, never abdicate responsibility
Split the duties between your staff members according to their caliber so that one staff
member is responsible for handling deposits and another staff member is accountable for
handling distributions. With the involvement of all the staff members, users can easily
balance the accounts at the month-end.
commingling or mixing funds
You need to set up an individual bank account for each client to hold their money. You can
not integrate personal or professional funds with trust accounts, and your accounting
program will allow you to create an account that is a sub-account of the trust for each
client with trust account money.
funds in the trust account are not yours.
You should adequately characterize the funds in your client’s trust account as they are not
an asset but “other current liability” of the firm. When your client asks for their trust
account balance refunds, you must pay them immediately. It would be best to create deposit
and withdrawal protocols into your trust account procedures.
adequate records of each client transaction
As a fiduciary, you must provide the correct accounting details to your clients. Collect all
the details like date, amount, source, and purpose of every deposit. Ensure the appropriate
client’s name is on every trust account cheque. It will reduce the odds that you’ll
overspend in one account while acting on behalf of another client.
You ought to ensure that you have correctly set up each client’s trust account, and for that,
you will want to complete a three-way reconciliation each month. Check the bank balance
against the balance in the accounting records, allocate and distribute the deposits
according to the balance shown on the statement. Do not skip the step of verification ever.
spend what you don’t have
Your client’s trust account funds are not yours, so they should never move without paperwork
and an appropriate reason. You should ensure adequate funds in the trust account for the
client on whose behalf you are about to issue a disbursement.
state bars and government regulations
The rules and regulations of trusts are set, managed, and enforced by the state bar. Most
jurisdictions direct you to preserve trust account records for five years after the client
matter is closed. The state bar or other government body may randomly audit a group of firms
and their trust accounts.
With the help of Vyapar billing software,you can maintain single and
multiple trusts using the best trust balance sheet software by Vyapar. The user can access
the data on different devices at their convenience, and they get the option to create GST
and Non-GST transactions. The app’s dashboard is organized and caters to all your accounting
Data Safety and Security
The app allows you to take a backup of
all your data, and your data stays safe in an encrypted format on your device. The auto
backup and updates features in the trust balance sheet maker app will let you continue your
work from where you left off, and you can also make your backup by saving data in an Excel
Spreadsheet or PDF format.
Cash and Bank Management
The user can easily do cash to the bank or bank to cash transfers. The trust balance sheet
format also allows you to adjust cash and bank amount and helps in cheque management. Trust
can easily manage all the accounts and analyze the profit and loss statements.
Tax and Discounts
As per Section 11, income derived from
property held under trust for charitable or religious purposes is exempted subject to
certain conditions. In other cases, any Trust with a total gross income of more than the
basic exemption limit must file income tax returns mandatorily. The balance sheet format for
trust helps understand the basics of tax applicable to trust.
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The balance sheet shows the trust’s financial position at the end of the accounting period but is
usually, by convention, included on the first page of the accounts. It shows the total value of the
funds held on behalf of beneficiaries and represented by: total assets less total liabilities.
The trust balance sheet format by Vyapar provides you with a snapshot of a business’s financial
position and helps determine risks and returns.
Yes, the charitable donation is eligible for tax deduction under Section 80G of the Income Tax Act
To obtain the tax benefit of making donations, you must submit the name, address, PAN of the donee,
Form 16, the stamped receipt, among other requirements.
A trust balance sheet helps describe a trust’s financial health insightfully and professionally. It
reveals the liabilities and assets to the interested parties, making it easier for anyone to analyse
the data at any point in time.
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