Get your Trust Account in tip-top shape

So we have discussed your Property Management health check – now let’s talk about your Trust Account.

We heard the communal groan but that’s ok, we won’t hold it against you.

Are you wondering where to start? Does the task seem insurmountable?

We are here to soften the blow and make the process simple through a step-by-step process.

Let’s go.

Annual Trust Account Health Check

  1. Reconciling

    First things first. Are you reconciled?

    It is really important to ensure you are maintaining your trust and reconciling your accounts regularly. The longer it is unreconciled the worse it gets. Don’t let your account turn into an avalanche. Reach out and get help straight away. Remember we are only a call away.

  2.  End of Month

    Have you rolled over your account and closed your month off?

    Each state has deadlines to ensure you have reconciled the previous month and closed this off. Make sure you are aware of the legislation in your specific State to stay compliant.

  3. Withdrawals

    Do you have any unpresented withdrawals?

    Check these have been approved for withdrawal at the bank. If not, why haven’t the funds been withdrawn?

    Follow up with suppliers or cheque withdrawals to ensure they have received the cheques. We want to ensure your owners stay happy and receive their funds. Keep an eye on your withdrawals and always double-check you do not pay these out twice.

  4. Adjustments

    As we have covered previously, there should be no need for adjustments.

    Here is a recap:

    • Tenants Deposits
      Do you have any tenants that accidentally paid more rent than they should have? Reach out to the tenant and have the funds refunded. Do you have funds on hold for tenants for invoices to apply? You don’t want to be holding funds you don’t need to. It costs you time chasing them up down the track.  Get ahead and be on top of them with a monthly check.
    • Unknown / Unidentified / Suspense
      However you wish to name them, do you have funds that you cannot allocate to a tenant, owner or supplier? Create a special supplier folio to record these, rather than creating adjustments. It makes it much easier and clearer to review these when the time comes. Check these often and allocate any funds you can as they are identified or as tenants move in.
    • Owners’ folios
      Are their payment details correct? Are all withheld funds still outstanding or do these need to be removed and funds released to the owner? It is a great time to reach out to your owners and confirm their disbursement frequency is set up correctly or if they wish to make changes. Do your owners have large bills outstanding after several weeks? Speak to your owner and suggest that you split them in order to get paid and keep all parties happy.
    • Balances in suppliers accounts
      Are the payment details for your suppliers set up correctly? Do you have an ABN listed for all your suppliers? Make sure you go and run this through the Australian Government Business website to check the GST status. Some suppliers will note GST on their invoices when they are not registered for GST.
    • Check all bond refunds have been allocated
      All bond funds have been lodged and reference details updated in your software.

By following both our Property Management and Trust Account Health Check, you are well on way your way to a successful and efficient 2022.

Jane Morgan is the Director of End of Month Angels, a consultancy firm specialising in Trust Accounting. Jane knows the legislative requirements of running a successful Real Estate office through her 24 years’ industry experience. Don’t trust just anyone with your trust accounting. Book an appointment with an End of Month Angel today.