Role requirements
The prudent person rule advises that when managing investments for another person, you must exercise care and diligence and adhere to a range of duties including:
- investing in investments that are not speculative or hazardous and which protect the best interests of all present and future beneficiaries
- obtaining advice and reviewing the performance of investments annually
- considering a number of matters such as the circumstances of the beneficiaries, the risk of capital or income loss and the likely return.
For a full list of duties and matters to be considered when investing for the adult you may wish to refer to the Trusts Act 1973. The following are extracted sections from Part 2 of the Guardianship and Administration Act 2000 - Particular Functions and Powers of Administrators:
Appropriateness and competence
(section 17)
When you applied as a proposed administrator, you signed a statutory declaration confirming that you were an appropriate adult and competent to act as an administrator. You must tell QCAT if there are any changes to your circumstances which have affected your appropriateness or competence to act.
Avoiding conflict transactions
(section 37)
A conflict of interest may happen between you and the adult where your interests or the interests of a person in a close relationship with you, conflict with the interests of the adult. Where a conflict transaction cannot be avoided you must apply to QCAT to approve that transaction.
Below are two examples of transactions where there may be a conflict or which may result in a conflict between your duties as an administrator and the adult:
- the adult lives in a nursing home and you or a person in a close relationship you wishes to live in the adult’s home, or
- you or someone in a close relationship with you wishes to buy the adult’s car, house or any other asset.
Payment of expenses
(section 47)
You are entitled to reimbursement from the adult for “reasonable expenses”. You must decide what is reasonable given the adult’s circumstances and keep full records about the reimbursement.
Keeping records and Records and audit
(section 49 and 153)
You are required by law to keep records. You must provide an Account by Administrator - Guardianship and Administration Act 2000 (PDF File, 878.0 KB) to:
- QCAT every year, two months before the anniversary of the appointment (or as stated in the tribunal's order) if the value of the adult’s estate excluding their principal place of residence and any nursing home bond is valued under or equal to $50,000, or
- one of the approved Panel of Examiners every year, two months before the anniversary of the appointment (or as stated in the tribunal's order) if the value of the adult’s estate, excluding their principal place of residence and any nursing home bond is valued over $50,000.
The current list of approved panel of examiners includes:
The Public Trustee of Queensland
Phone: 07 3213 9309
Fax: 07 3213 9262
Perpetual Trustees Queensland Ltd
Phone: 07 3834 5661
Fax: 07 3834 5662
Vincent Chartered Accountants
Phone: (07) 3228 4000
LHK Examinations
Phone: (07) 3300 2258
Mobile: 0424 371 308
QCAT does not charge a fee for this service however reserves the right to outsource matters valued under or equal to $50,000 to one of the approved panel of examiners as necessary. The examiner is entitled to charge a fee for this service. You will be issued with a tax invoice on behalf of the adult and you are authorised and required to pay the tax invoice within 30 days of receipt from the adult’s funds. Failure to pay the invoice may result in QCAT reviewing your appointment.
QCAT may require you to have your accounts audited. Selection of an auditor will be based on the adult’s circumstances in particular, the size and complexity of the estate and whether this is recommended by the QCAT financial assessment officer or the panel of examiners. QCAT requires that the auditor is qualified as per Section 52 of the Trust Accounts Act 1973.
Recording of receipt and payments
You must keep detailed records of the administration on behalf of the adult including full details and records of the adult’s assets (what they own), liabilities (what they owe), income (what they earn) and expenses (what they spend). To help you keep these records complete a Recording of receipts and payments - Guardianship and Administration Act 2000 (PDF, 484.5 KB).
If you use a commercially available system such as MYOB, you are still required to complete and lodge an Account by Administration - Guardianship and Administration Act 2000 (PDF, 878.0 KB). You may attach any MYOB forms as additional information.
Keeping property separate
(section 50)
Unless an asset is held jointly between you and the adult, your assets must be kept separate.
For example, the adult’s investments including bank accounts should continue to be in his or her name after the appointment, with you as a signatory. If necessary the account can be in your name as the administrator for the adult (for example, Mary Bloggs as administrator for Joe Bloggs). Your name as the administrator on the bank account should only be used in exceptional situations for example, when there is a risk that the adult or another person may try to have unauthorised access to the account.
Bank accounts should not be in your name as trustee for the adult. Creating such an account causes significant legal problems about the ownership, taxation, liability and deceased estate administration.
Investments
(section 51)
If you are going to invest money for the adult you must only invest in authorised investments which are approved by QCAT or are investments made under the prudent person rule.
The prudent person rule advises that when managing investments for another person, you must exercise care and diligence and adhere to a range of duties including:
- investing in investments that are not speculative or hazardous and which protect the best interests of all present and future beneficiaries
- obtaining advice and reviewing the performance of investments annually
- considering a number of matters such as the circumstances of the beneficiaries, the risk of capital or income loss and the likely return.
For a full list of duties and matters to be considered when investing for the adult you may wish to refer to the Trusts Act 1973. If you have concerns that a proposed investment might breach the prudent person rule, you can make an application to QCAT to have the investment approved.However, if the adult held investments that were not authorised investments at the time of your appointment, you are allowed to continue these investments on behalf of the adult.
Gifts
(section 54)
You can give presents paid for by the adult’s money without approval from QCAT if the gift:
- is one that the adult would have made when he or she had capacity, for example, birthday presents to children or grandchildren
- is reasonable taking into account the adult’s individual circumstances
- is of a nature the adult might reasonably be expected to make, for example, a wedding gift for a child or grandchild.
The value of the gift must be reasonable considering the adult’s circumstances.
Important: There are gifting provisions imposed by pension authorities such as Centrelink. These gifts may not comply with the QCAT legislation. Please ensure that you confirm any gifting provisions with QCAT and keep Centrelink and other such authorities informed about the adult’s current circumstances.
Maintaining an adult’s dependants
(section 55)
You may provide for the dependant of the adult providing that it is reasonable considering the adult’s circumstances, particularly their financial situation.