The audit of the trust account is to be performed in accordance with ASAE 3100 Compliance Engagements since the auditor is required to form an opinion on the agent’s compliance or non- compliance with the relevant Act and Regulations. 

Purpose 

The purpose of a compliance audit of a real estate agent’s trust account is to report on whether: 

·       accounting and other records relating to trust monies have been properly kept; 

·       there is no loss or deficiency of trust monies or failure to pay or account for trust monies; and 

·       there has been no failure to comply with a provision of the relevant Act or Regulations. 

Audit requirements 

Real estate agents must ensure that trust accounts are audited within the prescribed time frame each year. The cost of the audit is to be borne by the agent and is to be paid from the agent’s general account and not from the trust account. 

The auditor is to be allowed access to accounting records of the trust account, and to the records and files of the agent’s practice. This access is essential in ensuring that all transactions involving trust account money have been recorded correctly. 

Who can be an auditor?

Different states have different requirements, generally, an approved auditor is : 

·       A registered company auditor; or 

·       A member of a professional accounting body including: 

·       CPA Australia; 

·       the Institute of Public Accountants; 

·       Chartered Accountants Australia and New Zealand 

Due date for audit report

Different states have different due days.  For VIC, NSW, VCT, Tasmania, Western Australia, the due dates for audit reports are within three months after the end of the audit period, which is 30 Sep.   For South Australia, the due date is within two months after the end of the audit period.  For Queensland, the audit period is the 12-month period in each year ending on the last day of the audit month, the audit period depends on when the licence expires. 

For NSW, from July 2019, all audits need to be lodged on Auditor’s online portal without providing auditor opinions. For FY2021, there is an extension of the normal deadline from 30 Sep. to 31 Dec. 2021 in consideration to the Covid-19 lockdown situation. After December 31, 2021, the auditor’s online portal will be closed, all audits received after 31/12/21 will subject to penalty. 2021 Audit Report (Late) in paper version must submitted before 16/03/2022 to avoid the license being suspended.

For VIC, real estate agents must lodge their audit reports in myCAV within 10 business days of receiving them from the auditors. If the agents don't, they are committing an offence, which may result in a penalty of up to 120 penalty units.

Chang Accounting Advisory Pty Ltd, we are CPA practice and tax agent. If you or your families or friends need our services, please feel free to contact our team for any assistance. 

This article is for informational purposes only and does not form part of our advice. This article is based on different states relevant legislation and guidance for real estate agents. Please contact our team if you need any assistance.

Claire Chang, 0497 131 419, claire.chang@changadvisory.com.au, wechat: clairechang26

Michelle Cui, 0433 539 870, michelle.cui@changadvisory.com.au, wechat: michellejc