Explainer series — you’ve been appointed someone’s guardian, what happens now?

If you’re not quite at this stage, it’s worth looking at my first post that details what a guardianship order is, what types there are, a guardian’s powers and the process for putting a guardianship in place.

Once the court has granted your order and the Office of the Public Guardian (OPG) has issued your certificate of appointment, it’s time to look at ongoing management.

If you’re a financial guardian, the first step is to take stock and prepare an inventory and management plan.

Preparing an inventory

You’ll find basic information about assets the adult owns and their value in the original court application. This detail is there to help the sheriff decide about caution, but may only have been an estimate if, for example, the person seeking the appointment knows there’s a bank account but doesn’t have access to statements to see the balance.

The certificate of appointment allows you to access this information: the starting point for both providing a far more detailed asset and value list as well as the first annual account.

The inventory tells the OPG about the income, assets, expenditure, and debts the adult has. You’ll receive a letter with your certificate of appointment telling you when you’ll need to return the inventory — three months from when you were appointed.

You’ll find more information about this process on the OPG website.

Preparing a management plan

This plan outlines what you, as the financial guardian, anticipate doing with the adult’s assets.

This can range from everyday transactions — paying rent or care home costs — to more complex ones, such as investments. Where the adult has more than £50,000 in cash assets, the OPG will ask you to consult a financial advisor.

You’ll find more information about preparing a management plan on the OPG website.

You’ll need to submit the inventory and management plan to the OPG within three months of your appointment. Once approved, you’ll be able to take care of the adult’s affairs.

Annual accounting

The OPG has responsibility for overseeing the actions of appointed guardians and, at the end of each year from the date you’re appointed financial guardian, you’ll need to prepare a full statement of account.

The inventory is the starting point, and you’ll need to record all financial transactions using the adult’s funds.

The OPG can ask you to provide copies of bank statements, contracts, invoices, and receipts for items over £100.

Bearing that in mind, it’s sensible to keep records of these throughout the year anyway rather than leaving it until the deadline.

As an auditor, the OPG may also ask for further information before confirming its approval.

Ongoing management of a financial guardianship

The annual account, while bringing one year to an end, is a starting point for the next.

Much like the initial inventory prepared at the very beginning, the closing balance on the annual account provides the opening balance for the following year.

You’ll also need to consider the bond of caution renewal, if the sheriff ruled this was required when the order was granted. Caution is essentially a form of indemnity insurance that protects the adult’s estate against financial loss if things are mismanaged, and it needs to be renewed annually for the guardianship’s duration.

Most orders will include a provision that the level of caution required will change in line with the end of year value shown in the annual account.

Some orders, however, are fixed at the same value as when the order was granted.

The thing to bear in mind here is the adult can end up not having enough insurance cover — if a claim is made — if the value of cash and assets increases. On the other hand, they may end up paying a higher cost for more cover than they need if the balance decreases.

These fixed value orders can only be changed by making an application to the court, and I’ll discuss this in more detail in the next part of this series.

Welfare guardians

The OPG has no supervisory responsibility over welfare guardians — instead you’ll work with the local authority, which will provide guidance following your appointment.

When the OPG issues your certificate, it will also contact the Mental Welfare Commission (MWC) to let them know the order has been granted.

The MWC will know an application has been made and this simply confirms the outcome.

The commission provides a range of guidance and best practice publications. These are incredibly useful if you’re making decisions about where an adult should live, or if you’re consenting to medical treatment on their behalf.

In the next article I’ll focus on the process when circumstances change, or when you need to update an order, as well as what you need to do when the adult dies and how to approach the final accounting process.