Under the Property Stock and Business Agents Act 2002, licensees' records in relation to the handling of trust money must be audited.
Who is required to have their trust accounts audited?
The following people must have their trust accounts audited if they received or held trust money during the financial year ending 30 June 2019:
- a licensee (corporation or individual)
- a former licensee (corporation or individual), or
- a personal representative of a licensee.
In most cases, it is the licensed corporation that receives and is responsible for trust funds. Therefore, a trust account audit must be effectuated by the licensed corporation.
However, if an individual licensee receives and is responsible for trust money, then a trust account audit must be effectuated by the individual licensee.
Who is required to submit an audit?
All trust account audits must be completed and submitted online by the auditor through the Auditor’s Report Online portal.
When must the audit be submitted?
All audits must be submitted to the Secretary within 3 months after the end of the audit period and no later than 30 September 2019.
Please note that all previously approved alternate audit periods are now rescinded.
If a trust account audit is not submitted by the due date, licensees could be disqualified from holding a licence and possibly prevented from renewing a licence.
Who can conduct the audit?
Auditors must be registered with the Australian Securities and Investments Commission (ASIC) or be qualified under section 115 of the Property Stock and Business Agents Act 2002.
Registered audit companies, authorised company auditors and members of a Professional Accounting Body holding a Public Practising Certificate or Certificate of Public Practice can conduct the audit.
Professional Accounting Body is defined under the Australian Securities and Investments Commission Act 2001 e.g. CPA Australia, the Institute of Chartered Accountants of Australia and the National Institute of Accountants.
Who cannot conduct the audit?
Within the last 2 years of the audit period, an auditor must not have been employed by, nor be a partner of, the person whose records or documents are to be audited.
An auditor must not be a licensee, or a shareholder in a corporation that is a licensee with less than 20 shareholders.
Check that an auditor is registered by searching for their details on the ASIC website.
Frequently asked questions
Download a copy of the frequently asked questions - audit requirements (PDF, 125.34 KB) for answers to common questions about the audit process and requirements.
Audit for 2018/19 financial year
To prepare an audit report for trust money held during the 2018/19 financial year, visit the Trust account auditors page and download the Auditor’s guide.
Audits must be submitted using Auditor’s Report Online.
If you have any queries about the audit requirements please contact Fair Trading on 13 32 20.
If no trust money is held in 2018/19
Licensees, whether a licensed corporation or an individual licensee, no longer need to lodge a statutory declaration with NSW Fair Trading if they have not held any trust money during 2018/19.
Licensees who have not held any trust money during the year preceding their licence renewal date are required to indicate this on their licence renewal form.
Audits for other financial years
If audit documentation relating to a prior audit year is required, contact Fair Trading on 13 32 20.