Contractors invoices and banking statement and

CPPREP4005 - Prepare to work with real estate trust accounts (Release 1) Written Questions

Written Questions

What you need to do:
Answer the questions below by writing in the space provided.

Click on finish attempt to submit it for grading.

In NSW the relevant trust accounting legislation is: • Property and Stock Agents Act 2002 • Property and Stock Agents Regulation 2014

1.2
Research and list the sections of the legislation relevant to the following areas of trust accounting:

Question 2
List 5 examples of transactions that would NOT be entered into a trust account accounting system. (e.g. payment of wages to office staff).

Question 3

Complete the following table.

List (4) transactions you are likely to be handling on behalf of your clients / Principals and group the transactions according to whether they are a receipt or a payment.

Receipts	Payments

CPPREP4005 - Prepare to work with real estate trust accounts (Release 1) Written Questions

Question 5
What is the purpose of trust accounts in real estate?

The trust account is used when receiving or paying on behalf of the client. 1.Deposit of purchase of property 2.Tenant rent 3.Tenant bond General account is used for day to day expenses like 1.Wages 2.Insurance 3.Electricity 4.Office rent

•Receipting rent from a tenant
•Ending of month disbursement of funds to the landlord
•Receipting deposit from a purchase
•Problems with the trust account
•Issue a cheque for the balance of funds at settlement of a property.

account transactions and audits.

(Refer to the correct section of legislation as part of your answer.)

Question 10

Their can be a lot of impacts which can be caused by inaccuracies on clients and agencies. It is important in any agency that an analysis is completed outlining the mechanisms that are required to ensure that the company’s, and its client’s, assets are being protected at all times. In addition, the agency’s financial management systems need to reflect the outcome of trust account transactions so that an audit is easily able to track the payment of funds from the trust to the general account and create a paper trail. Effective internal control systems require first and foremost a commitment from the agency’s management to protecting the assets and communicating, implementing and preserving the integrity of the controls.

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accounting?

1) Policies and procedures for the employees to follow, particularly in terms of recording procedures
2) Reliable reporting systems to measure efficiency and effectiveness, this includes clearly delineated lines of authority and responsibility
3) The measures should be preventative
4) The financial management system needs to be designed so that management can easily monitor the input and output
5) The procedures and policies should be consistently followed by all staff, including management
6) Organisational charts allow for clear lines of authority and responsibility so that any gaps in procedure can be clearly identified
7) Performance standards and benchmarking that align with the set procedures to ensure that the system is being utilised appropriately and fulfilling requirements
8) Careful employee selection. Staff experience must match their responsibilities.

CPPREP4005 - Prepare to work with real estate trust accounts (Release 1) Written Questions

Question 14
What security arrangements need to be in place for trust accounts to ensure integrity, security, confidentiality and privacy of the information?

Question 16
What are the requirements under the legislation relating to manual and
electronic/computer based accounting systems. As part of your answer identify the section of the legislation and the specific requirements.

(Any information direct from the legislation can be copy and pasted as part of your answer.)

CPPREP4005 - Prepare to work with real estate trust accounts (Release 1) Written Questions

(3) The licensee must ensure, in respect of any journal—
(a) that entries balance before those entries are made in the ledger, and
(b) that any journal reference numbers are allocated in sequence under program control.

(8) The licensee must ensure that no amendment to the particulars of a transaction already recorded can be made otherwise than by a separate transaction effecting the amendment.

(9) The licensee must ensure that each program requires input in each field of a data entry screen intended to receive information required by this Part to be included in records.

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What are the legislative requirements pertaining to;

a)Receiving Trust Monies

c)Banking of trust money.

Question 19
Conduct research to answer this question.

What is the name of a software package that can be utilised for trust accounting and what is its function/purpose?

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Question 22
What are the (2) ways that trust monies can be disbursed out of the trust account?

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CPPREP4005 - Prepare to work with real estate trust accounts (Release 1) Written Questions

02/08/2013

Ted Johnson

Advertising
payment – 2
Second St, Byron Bay

$ 350.00

1206

02/0/2013

Jack Bryan

Rent – 309 Walker St, Rhodes

$630.00

1209

03/02/2021

03/02/2021

Michael Lee

Rent – 809 Walker St, Rhodes

$610.00

1211

03/02/2021

Question 24

b)In the table below write (2) examples of standard transactions into the cashbook

payments journal that you would expect to see in your day to day real estate activity.

© Real Estate Academy Australia

b)What are the standard trust account transactions you would expect to see in a ledger in your day to day real estate activity?

b)Bank reconciliation

a)Report

At the end of each month landlords are sent a rental statement outlining the income and expenditure for the month, and the net rent is remitted into our landlords’ nominated bank accounts by way of electronic funds transfer. At the end of each financial year a profit and loss statement is provided. These statements provide an annual summary of all the income and expenditure relating to the property.

Question 29
What is a transfer journal and give 1 example of its use?

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