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  Management Sections
Introduction to Management Skills

Safety Within Funeral Homes

Understanding the License Process  
Control of Communicable Diseases  
Awareness of Updated Product Information  
Cemetery Management  
Understanding Veteran Affairs Benefits  
Understanding Insurance - Life and Final Expense  
Understanding Contracts and Trusts  

Understanding Insurance - Life and Final Expense  Resources/Vita for Management

Example Investments Asset Allocations Based on Actuarial Data

Click here to see an example of Investments and Returns in PDF format.

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Restricted Funds

  • . . . The funds shall be held in trust, both as to principal and income earned thereon, and shall remain intact, except that the cost of the operation of the trust or trust account authorized by this section may be deducted from the income earned thereon. (497.417 (3))

Preneed Trust Accounting

  • “ . . . The trustee shall make regular valuations of assets it holds in trust and provide a report of such valuations to the certificate holder at least quarterly.” (497.417)
  • Trustee Fees are generally deducted from the periodic earnings
  • The remaining (net) earnings are then “pushed down” to the contract level on a pro rata basis to determine how much each individual Preneed contract has earned

Trust Recap

  • The DCI firm must
    • Author and meet all approvals for the trust document
    • Determine and Appoint a Trustee, Custodian and Investor
    • Determine and Author The Preneed Trust Investment Policy
    • Provide Preneed Trust Accounting

Preneed Contracts

The Preneed Contract

  • Requires a Two Way Partnership between
    • The Death Care Industry (DCI) Firm, and
    • The Department

The Preneed License Application Process

  • Part of the Application Process includes review and approval of the Preneed Contract

The Preneed Contract

  • Normally written by an Attorney
  • Reviewed by the Department, then a recommendation is made to the Board for
    • Approval
    • Denial
    • Review
  • Board Action on Preneed Contract


  • Nothing in the Florida Statutes requires the DCI firm to guarantee the Preneed price
  • Most all (if not all) DCI firms guarantee the Preneed price, via the “fine print” on their respective contracts

Florida Mandatory Disclosures (497.282)

  • (6) Provide to the customer, upon the purchase of any burial right, merchandise, or service, a written contract, the form of which has been approved by the board.
    • (b) The written contract shall provide an itemization of the amounts charged for all services, merchandise, and fees, which itemization shall be clearly and conspicuously segregated from everything else on the written contract.
    • (c) A description of the merchandise covered by the contract to include, when applicable, model, manufacturer, and other relevant specifications.
  • (7) Provide the licensee's policy on cancellation and refunds to each customer.
  • (8) In a manner established by rule of the board, provide on the signature page, clearly and conspicuously in boldfaced 10-point type or larger, the following:
    • (a) The words “purchase price”.
    • (b) The amount to be trusted.
    • (c) The amount to be refunded upon contract cancellation.
    • (d) The amounts allocated to merchandise, services, and cash advances.
    • (e) The toll-free number of the department which is available for questions or complaints.
    • (f) A statement that the purchaser shall have 30 days from the date of execution of contract to cancel the contract and receive a total refund of all moneys paid.

Additional Florida Mandatory Disclosures for Insurance Funding

  • For DCI firms funding through an insurance policy, numerous additional rules apply
    • See Rule 69K-8.005

Federal Mandatory Disclosures – The FTC Funeral Rule

  • Nothing in the Statute requires the Preneed contract to be compliant with the FTC’s Funeral Rule as it relates to the Statement of Funeral Goods and Services
    • If the Preneed contract is not FTC Funeral Rule compliant, the DCI firm must also provide the FTC required Statement of Funeral Goods and Services to the consumer


  • Due to the Department and Board having previously approved the Trust Document, Insurance Funding Vehicle and/or the Preneed Contract of the Certificate Holder, the Auditor’s biggest concern is to ensure the Certificate Holder is actually using the approved documents
  • The DCI firm should
    • Have copies of the trust document and other relevant trust documents available to the Auditor
    • Have copies of earnings reports available to the Auditor
      • Show the Auditor how earnings are computed and “pushed down” to the contract level
    • Ensure their respective Preneed contracts have language referencing the appropriate Trust document

Preneed Accounting

  • Suggested General Journal GAAP Entries for the DCI Firm
  • Assumptions
  • $1,000 Preneed Contract
  • $100 Initial Down Payment
  • 70% Trusting
  • $25 Commission
  Dr Cr
Deferred Preneed Sale   1,000
Deferred Preneed Receivable 1,000  
Deferred Preneed Receivable   100
Preneed Trust Account 70  
Cash Account 30  
Deferred Preneed Commission Expense 25  
Cash Account   25
  • Suggested GAAP Balance Sheet
  Dr Cr
     Current Assets    
          Cash Account 5  
     Other Assets    
     Preneed Trust Receivable 900  
     Preneed Trust Account 70  
     Deferred Preneed Commission Expense 25  
     Long Term Liability    
          Deferred Preneed Sale   1,000


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