Trust account handbook - Department of Commerce - wa.gov.au

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20 The agent should ask the bank not to debit the trust account with bank charges because this will create a deficiency. However, banks may inadvertently debit the trust bank account with certain charges. The agent should deal with these charges immediately and transfer an amount from the general account to the trust account to cover the deficiency if the bank is not immediately able to rectify the error. Frequent access to the balance held in the trust account, through means such as internet banking, allows the agent to identify withdrawals quickly and take action in a timely manner. Balance per bank statement This is the final balance on the bank statement and it is from this basis the reconciliation will be made. Bank statements must be received at least monthly. In practice, bank statements are received more often, even daily in many cases. Note how the bank balance is described with the term ‘Cr’ (credit or in funds). Add outstanding deposits These are deposits that have been taken up in the trust cash receipts journal (or credit side of the cash book) but have not yet been taken up by the bank. They are easily identified because they are deposits that remain unticked after the trust cash receipts journal/cash book and bank statement have been compared. Where there is more than one outstanding deposit, a list must be made showing alongside each deposit the date as disclosed by the trust cash receipts journal/cash book. Outstanding deposits are added to the balance per bank statement because when these deposits are eventually taken up by the bank, they will increase the funds held in the agent’s trust account. Less unpresented cheques Unpresented cheques are ascertained in the same manner as outstanding deposits and when listed, are identified by cheque number as well as amount. Such cheques are deducted because, when presented to the bank, they will reduce the trust funds in the agent’s trust account. Unpresented cheques should be followed up after three months. Balance per trust cash at bank If the outstanding deposits are added to the balance per bank statement and the unpresented cheques are deducted, the resultant figure will be a balance, which should always be a credit at the bank. SETTLEMENT AGENTS’ TRUST ACCOUNT HANDBOOK
Example: Trust account reconciliation statement ABC Pty Ltd T/A XYZ Settlements Trust Account Reconciliation Statement as at 31 August 2013 $ $ 1 CASH BOOK Balance brought forward from 31 July 2013 67, 500.00 Add: total receipts for August 52,000.00 119,500.00 Deduct: total payments for August 48,000.00 Balance as at 31 August 2013 71,500.00 2 BANK STATEMENT Balance as per bank statement 31 August 2013 78,000.00 Add: deposits not credited on FIS Nil 78,000.00 Deduct: unpresented cheques 357 2,500.00 358 4,000.00 6,500.00 Total trust money at 31 August 2013 71,500.00 3 CLIENT’S TRUST LEDGER BALANCES Total of attached listing of ledger balances as at 31 August 2013 71,500.00 Signed: M BROWN XX/XX/20XX Section 49(6)(d) of the Act, provides that a settlement agent must correctly balance the accounts at the end of each month and certify in records this has been done. Trust reconciliation statements, including related bank statements, must be retained as they form part of the trust account records. 21 SETTLEMENT AGENTS’ TRUST ACCOUNT HANDBOOK
Page 1 and 2: Government of Western Australia Dep
Page 3 and 4: Table of Contents Introduction.....
Page 5 and 6: Introduction The Settlement Agents
Page 7 and 8: 1.5 Types of trust accounts General
Page 9 and 10: 1.10 What trust documents and recor
Page 11 and 12: The following calculation can be us
Page 13 and 14: PART 2 TRUST DOCUMENTS AND RECORDS
Page 15 and 16: cross-referenced against the interi
Page 17 and 18: • amount received; and • the to
Page 19 and 20: 2.8 Buffer account Agents sometimes
Page 21: Regular monitoring of trust account
Page 25 and 26: 3.3 What are an agent’s responsib
Page 27 and 28: As well as advising Consumer Protec
Page 29 and 30: PART 4. PREVENTING THEFT AND FRAUD
Page 31 and 32: everse the transaction. Agents shou
Page 33 and 34: GLOSSARY Act (The) The Settlement A
Page 35: Department of Commerce Consumer Pro

Trust account handbook - Department of Commerce - wa.gov.au

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