Who must comply with Trust account audit + ASIC / state regulator submission?

Holders of client trust accounts (real estate, legal, conveyancing) must lodge annual audited accounts.

Trust account audits are a state-law obligation: each state sets its own audit period, auditor rules and lodgement process for agents who hold money on trust for clients. Victoria is the worked example here. A Victorian estate agent must have every trust account that held trust money during the year audited for the period 1 July to 30 June, within 3 months after 30 June, by an approved auditor using the audit report form approved by the Director of Consumer Affairs Victoria (CAV). The agent must keep the accounts so they can be properly audited, give the auditor all records and information reasonably required, and lodge a copy of the audit report with CAV through myCAV within 10 business days of receiving it. Auditors must report dishonesty, legal breaches or trust money deficiencies to CAV directly. In NSW, trust accounts kept by property agents are overseen by NSW Fair Trading under that state's own rules.

Applies when the business has client trust money and industry: Real estate agents / Lawyers & solicitors / Conveyancers. Where the business has industry: Real estate agents / Lawyers & solicitors / Conveyancers, check whether you hold money in a statutory trust account.

How the regulator frames it: Licensed estate agents and agency corporations that operate a trust account. In Victoria an approved auditor must be a practising public accountant who is a member of CPA Australia, the Institute of Public Accountants or the Institute of Chartered Accountants in Australia, and must not be an estate agent, an agent's employee or partner (or have been one in the last two years), or an officer of an estate agency corporation.

What triggers it: A trust account holding or managing trust money at any time during the audit period. A Victorian account that held no trust money all year needs no audit, but the agent must confirm that in myCAV. Ceasing to operate triggers a final audit.

Jurisdiction: Commonwealth law, so the test is the same in every state and territory.

Outcome across the 35 industries Rules Mate maps (3 of 35: only if a further fact applies; 32 of 35: no).

Structure does not change the answer in the 3 industries it can reach: for every structure the answer is "only if a further fact applies".

Size does not change the answer in the 3 industries it can reach: at every size band the answer is "only if a further fact applies".

Each line is one run of the Rules Mate applicability engine for a single business profile, with the reason the engine gives:

• Pty Ltd company in accountants & bookkeepers with 6–19 employees, turnover $1M–$3M: does not apply. Requires client trust money and industry: Real estate agents / Lawyers & solicitors / Conveyancers.
• Pty Ltd company in real estate agents with 6–19 employees, turnover $1M–$3M: check whether it applies. applies only if you hold money in a statutory trust account.

The engine shows this obligation as "check whether this applies" when a business has industry: Real estate agents / Lawyers & solicitors / Conveyancers. It then applies only if you hold money in a statutory trust account. That fact is not something Rules Mate can infer from industry, structure or size.

When due

Victoria: audit of the 1 July-30 June period completed within 3 months after 30 June (a varied audit date can be approved, no more than 12 months after the previous report); audit report lodged within 10 business days of receipt. On closure, notify CAV within 28 days and have the trust accounts audited within three months.

Frequency

Annual

Evidence to keep

Trust account records kept to allow a proper and convenient audit; a certified statement of trust money held on the last day of the audit period; the signed auditor's report on the approved form, retained for seven years and producible on demand; myCAV lodgement confirmation; nil-activity confirmation where no trust money was held.

Status

Current

Priority

Critical

Maximum penalty: In Victoria, failing to lodge the audit report within 10 business days is an offence with a penalty of up to 120 penalty units, and the Business Licensing Authority may suspend the agent's licence for failing to have trust accounts audited or to lodge the report.

Not determined: check with your adviser. Whether an independent review or audit is required turns on facts about the business, so Rules Mate does not assume either way. The facts that decide it: Do you hold or receive money on trust for clients (a trust account)? Did your law practice hold or receive trust money in the trust year to 31 March? Was it transit money only? Did your Queensland law practice hold or receive trust money in the year to 31 March? Did your law practice maintain a general trust account during the financial year (1 Jul - 30 Jun)?

Rules Mate tracks 2 published obligations tagged "trust account", 2 of them rated critical. For a professional services Pty Ltd company with 6–19 employees operating in every state, 0 of those apply outright. This obligation is rated critical priority and carries criminal liability, and is a annual obligation.

Regulated by NSW Fair Trading and Consumer Affairs Victoria.

NSW Fair Trading: Consumer protection, licensing (building, conveyancing, motor dealers), and tenancy regulator in NSW.

Consumer Affairs Vic: Victorian consumer protection, business licensing, tenancy, and incorporated associations regulator.

• NSW Fair Trading
• Consumer Affairs Victoria

Free tools that help with this obligation:

• Compliance calendar builder