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IAI Actuarial Core Principles · Business Management · Trusts and agency

The Bharat Seva Foundation is set up by deed so that property is held by trustees to run free eye clinics for any member of the public who needs them. Which feature distinguishes this from a private trust?

A public or charitable trust is for a public purpose benefiting an indefinite section of the community, such as anyone needing eye care, whereas a private trust benefits specific named persons. It still needs trustees and identifiable property, and it is not revocable at will by the settlor.

  1. AIt is for a public purpose benefiting an indefinite section of the community rather than named personsCorrect
  2. BIt requires no trustees
  3. CIt cannot hold immovable property
  4. DIt is revocable at will by the settlor in every case
  5. It need not have identifiable trust property

Explanation

A public or charitable trust serves a public purpose and benefits an indefinite class of the community, unlike a private trust for specific persons. It still needs trustees and certain property and can hold immovables. Revocability at will is not a defining feature.

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