Part 1: Short answers

Read the question carefully.

1. Examine theProperty and Stock Agents Act 2002(NSW)and list the number and name of 10 sections of the Act that apply to trust accounting. (220-250 words)

1. Examine theProperty and Stock Agents Regulation 2014 (NSW)and list the number and name of 10 clauses that apply to trust accounting.(150 - 170 words)

1. (a) Explain the purpose of trust accounts in real estate operations. Address the following areas in your explanation:

• What is a trust account? (20-30 words)
• Why must we have separate accounts for property sales and property management?

(20-30 words)

• Why can we not put that money in our general account? (30-50words)

(b) What is the difference between sales trust money, property management trust money and general business trading money? Provide two examples for each type of trust money to support your analysis. (150 - 200 words)

1. Different Australian states and territories have different rules and regulations when it comes to trust accounts. What are the rules when a licensee opens a bank account with an approved financial institution in NSW? (100 - 150 words)

1. According to theProperty and Stock AgentsRegulation 2014 (NSW), licensees can keep manual or computerised trust accounts.
2. Analyse and list two records of trust account transactions that must be kept by a licensee. (150 - 200 words)

1. Identify and explain five essential requirements required by the legislation when operating a computerised trust account. In your answer include a reference to specific sections/clause of the legislation. (80 - 100 words)
2. Explain three functions that computerised trust accounting software must be able to perform to maintain trust accounts.(60 - 80 words)

1. Identify the role and responsibilities of the following three staff roles in relation to the trust accounts: (30-80 words)

• Class 1 - Licensee
• Class 2 - Licensed real estate/strata/stock and station agent
• Assistant agent

1. (a) Assume that you are employed as a property officer in your agency. Explain your role, responsibilities and limitations in maintaining the trust account. (40 - 60 words)

1. Assume you have now received a promotion to property manager, explain how your responsibilities in relation to the trust account may change in that role. (50 - 70 words)

1. Under the Property and Stock Agents Act 2002-Supervision guidelines, list and explain the licensee's responsibility in regard to trust account transactions. Explain how those responsibilities impact day to day trust account transaction such as settlement or end of month. (50-70 words)

1. Part 7, section 92 of theProperty and Stock Agents Act 2002(NSW) sets out the requirements for overdrawn trust accounts. Explain what actions the licensee must take if the trust account become overdrawn. (50 - 70 words)

1. Using theNSW Fair Trading website, explain the purpose of internal and external audits of trust accounts. (100-170 words)

1. Explain the license-in-charge legislative responsibilities, under theProperty and Stock Agent Act 2002(NSW), regarding trust account audits. (100-170 words)

1. (a) Explain the implications for the real estate agency where:
2. inaccuracies occur in the operation of the trust account and
3. fraud occurs in the operation of the trust account

(40 - 50 words)

1. Explain the implications for clients, if there are inaccuracies in the operations of the trust account that may result in late payment(s). (40 - 50 words)

1. Explain the implications for clients, if the agency is found to have committed trust account fraud. (40 - 50 words)

1. Locate the accounting documents for Azure Beach Realty Group contained in Appendix 1 of this assessment and answer the following questions in relation to the end of month processing, as required by legislation in NSW:
2. List all records that relate to the trust account. (5 -10 words)

1. Review the receipts issued to clients of the Agency for monies received. Explain the requirements for issuing of receipts and how these receipts will be recorded in the trust account records. (50 - 60 words)

1. A tax invoice for stationery has been issued by Harry's Stationery which is not yet paid. How will the payment of the invoice be recorded in the accounting records of Azure Beach Realty Group? (40 - 60 words)

1. Explain the purpose of the Bank deposit form and Bank Statement and why these documents are needed for the monthly processing of the trust account. (100 - 120 words)

1. Review the Trust Account ledger for Richard and Gina Waterstreet. Explain the entries in the ledger and identify which accounting documents relate to the entries. Give reasons for your answer. (150 - 180 words)

1. (a) Errors or inaccuracies can compromise the accuracy and integrity of the trust account. Outline fourmajor causes of errors or inaccuracies that can occur in the trust account and explain how each should be addressed to correct the issue. (120 - 140 words)

1. Describe twoother occurrences that can lead to the trust account being compromised. (50 - 60 words)
2. Refer to thefollowing scenario and answer questions (a) and (b) below.

1. The following list of transactions have been extracted from the books of the Azure Beach Realty Group.

Review each transaction and determine who has the scope of responsibility for each transaction then complete the table.

Transaction	Actions required	By whom
A tenant comes into the office to pays this week's rent of $400 in cash	(list three)
A purchaser pays 10% of $40,000 deposit for the purchase of a property via EFPOS	(list two)
A payment of $500 made to a tradesperson for repairs to a rental property	(list two)
A payment of $2,000 received in cash for a rental bond	(list three)
An EFPOS payment of $120 received from a tenant for water usage for the full period	(list two)

1. Azure Beach Realty Groupmaintains its trust accounts using a computerised trust accounting software package. The licensee wants to ensure the integrity, security, privacy and confidentiality of trust account information is maintained.

Complete this table and explain what measures the licensee can put into place to achieve this.

Table 1: Trust Account Information

	Integrity	Security	Privacy and confidentiality
Measures that can be put in place	(30 words)	(60-70 words)	(35-40 words)

1. Explain the requirements of each of the following standard trust account transactions.

Transaction	Requirements
Cash, cheque, Electronic Funds Transfer and direct deposits (100-110 words)
Cheque and Electronic Funds Transfer and withdrawals (100-110 words)
Entries to journals and ledgers (300-350 words)
Balances and reconciliations (100-120 words)
Reports and statements (140-150 words)

1. Explain trustaccount requirements when receiving, receipting and banking trust monies. (Between 350 and 370 words)

Appendix 1: Accounting documents Azure Beach Realty Group

Item 1:Cheque received from Agency clients Richard and Gina Waterstreet.

Cheque from GWaterstreet.pdf

Item 2: Receipt issued to Richard and Gina Waterstreet.

ABRG sales receipt.pdf

Item 3:Receipt issued for cash received from Thomas Fishburne

ABRG cash receipt.jpg

Item 4:Bank deposit form

ABRG bank deposit form.jpg

Item 5:Trust Ledger entries for clients Richard and Gina Waterstreet as at 31 October, 20XX.

ABRG trust ledger - R&G Waterstreet.jpg

Item 6:Bank Statement for Azure Beach Realty Group Trust Account as at 31 October, 20XX.

ABRG bank statement.jpg

Item 7:Tax Invoice for Office Stationery issued to Azure Beach Realty Group.

Harry's stationery invoice.jpg