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The position of executor: from cradle to grave – Part III

By Avi Dahary

Taking inventory of estate assets

In part two of this series, I explored the initial steps one needs to take when they are named an executor in a deceased’s will. In this part of the series, I will discuss identifying the assets that become part of the estate and compiling a list of them in order for the executor to bring them under his/her control and safeguard them.

Reading the will and consulting with the family members of the deceased who were familiar with his/her affairs is a good starting point for identifying possible or actual assets. The executor will need to visit the place of residence of the deceased and search for, and through, documents that identify the deceased's bank and investment accounts, business interests, real estate properties, mortgages, life insurance policies, safety deposit boxes, jewelry, art or other collections, and any other item of value.

In some cases, the deceased may have a safe in the home. It's up to the executor to ascertain the code or hire a company to open the safe in order to take control of the items inside. If cash is found, it's necessary for the executor to count it and take appropriate steps to safeguard the money until it is deposited into the estate’s bank account as soon as possible. If the amount of cash is large or the value of jewelry found in the safe is high, the executor would be prudent to consider hiring a security company that specializes in transporting and storing such valuables as cash, gold, diamonds, etc. for safekeeping until such time as they can be liquidated or transported to a permanent secure location.

If the deceased owned a business, it may be necessary for the executor to visit it, meet with existing management and ensure steps are taken for operations to continue uninterrupted. A change in circumstances due to the death of the business owner may bring about a need to make changes in the management team. The executor needs to take steps to ensure that the management team is fit and capable of continuing its operation in a competent manner. It's necessary for the executor to obtain access to the company's financial records, statements, tax returns, directors’ resolutions, and minute book, etc. These could be found with the firm's accountant or corporate lawyer.

The executor will need to visit or write to any identified bank, investment firm and insurance company in order to obtain an inventory of bank accounts and balances, accounts with the underlying cash balances and securities, and life insurance policies with details of the insured amounts, terms and beneficiaries of the policies.

In addition, the bank will provide to the executor details related to any outstanding loan or mortgage the deceased was obligated under, and any credit card with balances owing.

If a real estate property is involved, the lawyer for the estate would do a title search to ascertain title to the property and find out what encumbrances there are, if any, against it such as mortgages, liens, etc. 

As well as learning about any debt obligations, the executor needs to determine whether any outstanding amounts were receivable by the person at the date of death. These could include salary or wages, pension, if the deceased was a partner in a partnership, then any income due from that, and death benefit from a workplace pension or the Canada Pension Plan, etc.

At this stage, the executor has made an inventory of the assets that are under his/her control and it would now be the time to determine whether they are sufficiently insured, and if an uninsured asset needs to be insured adequately to safeguard it from any loss, damage or decline in value. Ensuring estate assets are adequately insured protects the executor, the estate and ultimately, the residual beneficiaries.

Stay tuned for part four of this series in which I explore determining what debt obligations the estate has and the discharging of those obligations.

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