For those who do not like long blogs, the short answer is: never let a CoSec plan your trust and don't bother looking for an accountant to advise on trust work as they don't exist in Asia.
For those who seek wisdom, scroll on down........
Now the typical accountant knows nothing about creating or administering trusts. So why are accountants part of the trust business picture? For starters, they know where the wealth is. Like pigs find truffles, where you find accountants, you find money. Forget private bankers, who only see bankables (cash, stocks and bonds). That is typically only the tip of the iceberg. Particularly in Asia where much wealth is generated and not inherited, what lies beneath the millions that are invested in the banking world, are billions that are tied up in real estate and trading companies and manufacturing plants. Accountants project cash flows, so they know how your business is going to make. They prepare your personal tax returns so they know how much you made. They audit (modern speak: offer assurance services to) your companies and know what it's worth down to the number of paper clips and writing pads you have in the desk. They also help cook the books so no one else knows. They were in every corner of the world, from the every former Colonial colony to the sand dunes outside Dubai, to the steamy jungle of Labuan, to the skyscrapers of Hong Kong to the most isolated Pacific tax haven. They had global networks for cross-border transactions that so-called international law firms and banks envied. They already have the ear of the movers and shakers, rock stars and sport celebrities. A good accountant is like the trusted butler and trust goes a long way in our business. It was a logical progression for some accountants to move into the personal wealth consulting business.
A small group of specialized accountants know about accounting (fancy word for book-keeping) for trusts and unless you're a trustee, run a NPO/charity or have your own private trust company (PTC), you will never need to know about them. But like a chef opening his own restaurant, these accountants also took over the trustee businesses often from the inside.
Now when it comes to trusts, accountants and CoSecs are somewhat handicapped by their lack of formal training in trust law......kind of important wouldn't you think? If it wasn't apparent in the discussion about trust lawyers, trust law is a very specialized area of law that even regular lawyers aren't qualified to work in. Essentially some accountants and CoSecs are practicing trust law without a license. Scary and potentially life-threatening but, accountants are kind of like building/construction contractors......they may not understand the physics and structural engineering that goes behind building a house but they can get it done. Sometimes it's monkey see, monkey do. Sometimes, as a result of diligent self study and supplemental education. Far too often, lawyers are like one-night stands (come in, drop off the advisory and then disappear) whereas accountants are still part of the picture for years to come as trust accountants or tax consultants, etc. and practice makes perfect. Or at least they see and learn from the practical side of things. And sometimes, that makes them superior to any theory spewing from the lawyers. But the bigger or more complex the building, the more the accountants' handicap becomes apparent.
Unlike the UK, Australia or US, Canada, accountants that provide trust advisory have virtually disappeared from Asia. There are a few dinosaurs holding out but their demise is inevitable. Their ELE (extinction level event) happened with the CPA blow up of the late eighties/early nineties. CPA firms had too many fingers in too many pies, everything from tax to trusts, to probate/estate, to business consulting, to HR, to share registries, company secretarial, to syndicated loans, etc.. Conflict of interest charges, audit failures, Arthur Andersen and ka-boom. The big 8 became Big 4, non-core accountancy businesses were sold off or wound down. Most trust advisory CPAs retired, sought refuge in trust companies or gave up trust advisory and return to their core practices.
Then the death knell....abolishment of Estate Duty in Hong Kong then Singapore in the second half of this decade. With the disappearance of the most obvious tax and trust need, the heyday of the trust planning accountant was over. So unless your CPA is a dinosaur from the 80s or a migrant from one of the aforementioned places, they probably know nothing about trusts. You don't want to part of anyone's learning curve or initial foray into the trust world.
Company Secretaries. The people that incorporate and administer to companies, be it a listed conglomerate to your $1 tax haven PIC. These professionals can be part of any legal practice, accountancy practice, bank, trustee or private operation. Where there are companies, there are likely wealthy shareholders, hence the road for CoSec's to enter the private wealth arena. Consider Trust 101: Despite many similarities in their constitution and construction and even operation, a trust is not the same as a limited company. Astronomy versus astrology. CoSec's that fail to appreciate and understand that basic principle are likely to screw up any trust advisory and trust administration. They are like your building superintendent/management company. They help keep things running in the building but would you hire them to be architects or structural engineers?
Next up....the banks, insurers, FAs and trust companies.
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