What should you be checking on your trust account at the End of the Month?
It’s so easy to just sight your bank statement and end of month report, see that the balance matches and then sign the report… Right?
Unfortunately, No….. there’s more to this step to keep everything tip-top.
So what else should you be checking before you sign the report? Here’s our recommended 10 point checklist to complete your EOM report for your trust account.
10 point EOM checklist for your Trust Account
- 1 - Ensure your trust account is reconciled
Does the bank statement closing balance match that of the report?
If not – investigate further and rectify. This is always your best first step.
- 2 - Bank Statements - share them
Provide your auditor with copies of your bank statements. These can be electronic copies.
- 3 - Review your Cashbook reports against the Trust Reconciliation report
Do the balances match?
It’s easy to assume they do, we’ve all done it after all, but occasionally they do not and these will need to be investigated.
- 4 - Review your Trial Balance for funds you are holding in trust
This is something we recommend is reviewed monthly. If you have not completed this review in a while or do not have ability to complete this often, take the time to review at minimum each quarter.
By completing regularly you can easily resolve any old balances, which are usually held for a known reason – as the reasons are top of mind.
- 5 - Review any Adjustments you have in your trust
Adjustments are considered a very big ‘no no’ in trust accounting.
If you have any of these, review them and establish why they are there and if they can be removed.
Your auditor will query these, so you should ensure you have a detailed note as to why you have these in your system, and what steps are being taken to rectify and remove.
- 6 - Unreconciled Deposits
These should only include deposits which are not deposited to your trust account until the following business day. If these include other items, you need to review and investigate each further to resolve.
- 7 - Unreconciled Withdrawals
We recommend that any unpresented cheques should be investigated if older than 30 days.
Likely the recipient has lost, misplaced or not received the cheque, so it will need to be cancelled and reissued.
If you have unreconciled electronic payments, review and investigate why they have not been processed. If presented to your bank the following day, just make a file note for the auditor and keep on file.
- 8 - Trust Audit Notes
Review and save any notes to adjustments or corrections made to your trust account during the month and make these available to your auditor on request.
- 9 - End of Month Reports
The Officer in Effective Control of your agency must sign and date the report before saving a copy in a secured location. This copy to be made available to your auditor and the relevant body in your state on request. This can also be an electronic copy.
- 10 - Now relax ...... That's it!
If you need any assistance or have any queries at all regarding this process, please do not hesitate to contact us at admin@trustdfigures.com.
Want to see more? Check out how we manage our trust accounts.
