What is the Statement of Financial Affairs?

  • By Jillian Taylor-Mancusi

Statement of Financial Affairs

One of the most important documents your licensed insolvency trustee will work with you to prepare is the Statement of Financial Affairs. Although the title of the document can be intimidating it’s really nothing more than a well-prepared budget. Understanding what the statement is, why it’s needed, who will get copies of it, and what information you need to provide will help get the job done with a minimum of stress.

What is a Statement of Affairs and why is it necessary?

A Statement of Affairs lists all of your assets (things you own), your liabilities (debts), how much money you bring in, and how much you must pay out. This information gives your trustee the information needed to determine

  • your financial situation,
  • whether you must make surplus income payments,
  • which of your asset will be seized and liquidated,
  • which of your assets are exempt,
  • which creditors will be included in your bankruptcy, and
  • what fees and charges you will pay.

After the budgetary worksheet is completed, your licensed insolvency trustee will ask you questions about your family life, job, and how you have spent money you have received within the recent past. The information will be organized and presented as a document you are required to sign. Although you have presented the information included in the report, it’s important to read and understand the Statement of Affairs before you sign it.

You can see what “Form 79—A Statement of Financial Affairs” looks like on the website maintained by the Office of the Superintendent of Bankruptcy.

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Bring the Right Information

An accurate Statement of Affairs is essential. It protects you from questions creditors may have about the way you have handled your money and why you filed bankruptcy. It also keeps you on track for an automatic discharge.

Come to the meeting with your trustee well prepared and able to provide:

  • T-4 forms
  • Tax returns
  • Estimated tax refund
  • Information about life insurance policies with a cash value
  • Securities statements
  • Bank statements
  • Utility bills
  • Mortgage loan statements
  • Debt statements
  • Auto loan statements
  • Deeds and titles
  • Retirement savings statements
  • Student loan information
  • List of personal possession such as furniture, jewelry, and clothing

Statement of Affairs—The Distribution List

A document floating around with so much of your personal information included is bound to make you a little nervous. Knowing who gets a copy of it and why may help to calm your nerves. Your licensed insolvency trustee keeps a copy of your Statement of Affairs and also forwards a signed copy along with other documents to the Office of the Superintendent of Bankruptcy.

Your creditors will also receive a copy of your Statement of Affairs. They will receive this copy at the beginning of the process so that they can be fully informed and able to participate in the meeting of creditors.

The Statement of Affairs contains information necessary to move your bankruptcy forward. Working closely with your trustee will make preparing this document much easier for you and your Licensed Insolvency Trustee.

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