Partnership, 529, Trust and Estate, Employee Benefits Plan Flashcards
What authority does a General Partnership have?
The authority to influence investments so a general partner’s financial interests in both the partnership itself and its underlying investments are direct
LLCs if member-managed has…
are like general partnerships, that members interests in both the firm and its underlying investments are direct
LLCs if agent-managed has…
are more like limited partners and their interests in the underlying investments are viewed as indirect interest (unless members have ability to control)
Covered members asked to serve as trustee of estate or executor of an estate will cause a problem if…
1 The covered member has ability to make investment decisions for the trust or estate
2 The trust or estate owns or is committed to acquire more than 10% of attest client’s ownership interests
3 The value of the trust’s or estate’s ownership interest in the client exceeds 10% of its total assets
Grantor has direct financial interests when…
1 Has ability to amend or revoke trust
2 Has authority to control the trust
3 Has the ability to supervise or participate in the trust’s investment decisions
What is a Blind trust?
When investments ultimately will revert to the grantor who typically retains the right to amend or revoke, both a blind trust and it’s underlying investments are considered to be considered direct interest
What authority does a Limited Partnership have?
A limited partner’s interest in the limited partnership is direct, but usually he or she will not have influence over its investments so this partner’s financial interest in it’s underlying investments will be indirect
When a covered member is an employee of a government organization that sponsors an employee benefit plan and the member is required by law to audit the plan, then it is acceptable to do so if all the following safeguards are in place?
1 The covered member is required to participate in the plan as a condition of employment
2 The plan is offered to all employees in comparable positions
3 The covered member is not a director, officer, employee, promoter or the like of the plan
4 The member has no influence or control of the investment strategy, benefits or activities of the plan
