Trust annual health check: the one-page review to run each year with your trustee

A trust annual health check is a short, repeatable review that you and your trustee complete together, once a year, on one printable page. Its purpose is not to audit the trustee from scratch. It is to confirm that the file is complete, the data is current, and that nothing has drifted since last year: a new tax residence, a new bank account, a beneficiary who has come of age, a trustee team that has changed.

Most problems in long-running trusts are not dramatic. They are small gaps that nobody noticed because nobody looked. A yearly page keeps the gaps small. If you are new to checking a trustee, start with due diligence on your trustee; this page is the routine that follows once the relationship is established.

How to use this page

Print the checklist below, or copy it into your own document. Send it to your trustee two or three weeks before the meeting you already hold each year, and ask for a written answer on each line. Mark every line in one of three ways: confirmed, to fix, or not applicable. Keep the signed page in the trust file.

The check works best when it is boring. Same page, same month, same people. A line that is "to fix" in one year should be "confirmed" the next; if it is not, that is the signal worth acting on.

The six areas to look at

Not every area carries the same weight in every trust. A trust that holds a family company needs more attention on decisions and minutes. A trust that holds only portfolio accounts needs more on bank mandates and reporting. The scale below is a qualitative guide to where attention usually goes, not a measurement.

1. The trust deed and its amendments

Ask for the current, complete trust deed together with every amendment, deed of appointment and deed of retirement. Check that the version on file matches the version you hold. Confirm who has the power to appoint and remove the trustee, because that is the power you will need if the relationship ever has to change. The glossary entry on the deed of retirement and appointment explains the document that records such changes.

Also ask whether any reserved powers still reflect what you intended. The Hague Convention accepts that a settlor may keep certain powers without the trust ceasing to be a trust, but it also expects the trustee to manage and account for the assets. Reserved powers deserve a fresh look each year; the page on settlor reserved powers and the trustee sets out the balance.

2. Records and trustee decisions

A trustee holds title to the assets in its own name, but the assets form a separate fund, apart from the trustee's personal property. That separation only means something if the paperwork shows it. Each year, look for:

• minutes or written reasons for each significant decision, including decisions not to act;
• the accounts for the trust year, with a clear link to bank statements;
• a record of distributions and the basis on which they were made;
• any conflict-of-interest notes where the trustee or an affiliate was involved.

A missing record is not proof of a problem, but it is the earliest visible sign of one. The case of the review that revealed missing minutes shows how a gap like this typically surfaces.

3. Beneficial owner and reporting data

This is the line that changes most often, because it follows your life rather than the trust's. Ask your trustee to confirm, in writing, the data it holds on the settlor, the beneficiaries, the protector and anyone else with control. Check names, tax residences, nationalities and any new status that might trigger reporting, such as a move abroad or a change in US status.

Trustees in Switzerland work under anti-money-laundering rules (AMLA) and report on account holders under automatic exchange of information (AEOI, also called CRS). Both depend on accurate data. If your circumstances changed during the year, tell the trustee before the review, not after. The page on compliance and reporting duties describes what the trustee does with that information, and the yearly compliance review covers the trustee's own side of the exercise.

4. Bank accounts and signatories

List every account held in the name of the trustee for the trust, and every one held by an underlying company. For each, ask who can sign, who can give instructions, and when the mandates were last reviewed. People leave trustee firms and advisers change; old signing rights have a way of surviving. See your trustee and the trust bank accounts for how the arrangement should work.

5. Letter of wishes and protector

A letter of wishes guides the trustee; it does not bind it. It goes out of date when families change. Re-read yours once a year, and ask the trustee to confirm that the latest version is on file and how it was taken into account. If there is a protector, confirm who holds the role, what powers they have, and whether they have been kept informed. The pages on letters of wishes and working with a protector cover both.

6. The trustee team and its approval

Ask whether the individuals who handle your trust are still the same, who covers during absences, and whether the firm is still authorised and supervised. In Switzerland, trustees are authorised under the Financial Institutions Act (FinIA, or LEFin) and supervised through a supervisory organisation. The FINMA list of authorised trustees names several such bodies, among them OSFINcontrol AG, AOOS, SO-FIT and OSIF. A short line in the health check confirming current authorisation and the supervisory body costs nothing. For what the approval means in practice, read FINMA and SO-FIT: what trustee approval means for you.

The printable checklist

• Current trust deed and all amendments on file, matching my copy
• Power to appoint and remove the trustee confirmed in writing
• Reserved powers reviewed and still intended
• Minutes or written reasons for each significant decision this year
• Trust accounts for the year received and reconciled to bank statements
• Distributions listed with their basis
• Data on settlor, beneficiaries and protector confirmed as current
• Changes in residence, nationality or tax status reported to the trustee
• Every account and signatory listed; mandates reviewed
• Letter of wishes re-read; latest version on file
• Protector role and powers confirmed
• Trustee team, backup arrangements and supervisory body confirmed
• Open points from last year closed or carried forward with a named owner

One line, filled in

Here is how a single row might look after the meeting. The example is an illustration: a family settled in Lausanne, with a trust run by a Geneva trustee.

Notice what makes the line useful: a specific question, a written answer, a status, and a named owner. A line that says only "all fine" tells you very little.

What to do with the result

If most lines are confirmed, file the page and note the date. If several are "to fix", agree a short list with the trustee and put a date against each point. If the same points keep returning, or if answers are slow or vague, move from routine checking to a proper look at the relationship. The comparison switch trustee or stay and fix helps you decide, and reviewing an existing trust in ten questions goes deeper than a yearly page can.

What a health check cannot do is replace advice on your own situation. Residence, the countries of your beneficiaries, the nature of the assets and the canton all affect which lines matter most. Fees depend on the structure and are discussed after a confidential assessment.