Are you a real estate agent? You need to be aware of your obligations in terms of being compliant with trust account audits. Kym Nitschke highlights some of the most important points you need to keep in mind and answers your biggest questions.
According to the SL Land Agents Act 1994, an agent who maintains a trust account must have the account and records audited annually. Failure to have this audit conducted is a serious offence and can incur penalties of up to $20,000 and cancellation of your registration.
Here is what you should know about a trust account audit:
– You are responsible for paying for the audit. The cost is not to come out of the trust account
– As the real estate agent, it is your responsibility to ensure that your account is audited in a timely manner according to your state/territory requirements
– Some areas require more than one audit per year, including unscheduled ones
Why does my account need to be audited?
Audits of trust accounts are carried out to achieve three main goals:
– Make sure that records of money flow through the trust are accurately being kept.
– Ensure that there are no deficiencies.
– Confirm that you have been compliant with all the provisions of relevant Regulations or Acts.
Overall, these goals help the auditor to reach the objective of determining that your account is in compliance with the Acts and Regulations that pertain to you in your area.
There have been minimal or no transactions through my account trust. Do I still need to have it audited?
Yes. The need for an audit is determined simply by the existence of the account. It isn’t dependent upon account activity. Having a trust account automatically makes you responsible for having it audited annually.
Who can perform the audit?
You want your auditor to have a complete knowledge of the rules governing trust account audits. An individual prescribed by Regulation through the Institute of Chartered Accountants is qualified to conduct your audit.
Choosing your auditor
At Nitschke Nancarrow, we strive to do the following:
– Clearly communicate the audit requirements (such as necessary documentation) to you well in advance
– Work with you, the client, to achieve lodgement deadlines
– Incorporate quality and efficiency in all the services we provide
When you visit our Adelaide office, you will experience the crucial blend of expertise and thoroughness that we offer as we answer your questions and help you achieve your goals.
Would you like to learn more about how Nitschke Nancarrow can help you have a successful audit of your trust account? Contact us today on (08) 8379 9950 or send me an email.
– Kym Nitschke