Jackson's sister Janet comforted his daughter Paris at his memorial service
Michael Jackson's children are "doing wonderfully with their grandmother guardian", a judge has said.
Los Angeles Superior Court Judge Mitchell Beckloff was "very pleased" with a probate investigator's report on how the three children are adjusting.
The judge also increased the powers of two men administering the singer's estate, partly due to substantial debt.
The pop legend died aged 50 in June. His death was ruled to be homicide caused by a powerful anaesthetic.
His children, Prince Michael, 12, Paris, 11, and Prince Michael II (known as Blanket), 7, have been in the care of Katherine Jackson since their father's death.
Jackson's estate is paying a stipend of $60,000 (£37,600) per month to care for and protect the youngsters.
The singer has had several creditors' claims made against his estate
Mrs Jackson was appointed by Judge Beckloff as the children's permanent guardian in August, and he had asked for an update on their conditions.
In his 2002 will, Michael Jackson designated his mother as his choice to care for his children if he died.
The judge sealed the report on the children and said he saw no need to get future updates.
However he gave lawyer John Branca and music executive John McClain general powers over Jackson's estate.
This will allow them to consider creditors' claims and enter into business deals that are not opposed by his mother, without judge Beckloff's approval.
Until Friday, no-one could accept or reject creditors' claims against Jackson, who died with an estimated $400m (£251m) of debts.
Mr Branca and Mr McClain can also begin to represent the estate in several court cases which were pending against the singer when he died.
The judge made the ruling despite the objections of Mrs Jackson's lawyer.
There have been several claims of unpaid bills filed against Jackson's estate, including from his criminal defence lawyers who won his acquittal against child molestation charges in 2005.
Jackson's father Joe attended the court hearing on Friday but did not comment.