For trust account auditors

Real estate trust accounts must be audited and auditors of these trust accounts have specific duties.

​All nominated auditors will be receiving a letter from the Authority that contains information on auditing an agency's trust accounts.

What are the requirements for qualification as a nominated auditor?

A person may be appointed as the auditor of an agency's trust accounts if that person—
(a) is a qualified auditor; and
(b) is not disqualified from auditing the agency's trust accounts under regulat​ion 11​​.

See sections 37 to 39 of the Financial Reporting Act 2013 for information on the appointment of a partnership as an auditor.

What is the basis for the conduct of the assurance engagement?

Your audit of these accounts should be conducted to the standard required of a reasonable assurance engagement as specified by the NZ Institute of Chartered Accountants Standard on Assurance Engagements 3100 (SAE 3100). Click here to download the SAE 3100 (.pdf 218KB).
Your audit report should be submitted to the Authority using the template provided by the Authority.

What are the duties of auditors?

The specific duties placed on you are summarised below.  Please ensure you make yourself familiar with the full details of these duties by referring to the Real Estate Agents (Audit) Regulations 2009.
it is an offence to fail, without reasonable excuse, to comply with the regulations.  The penalty for which is a fine of up to $15,000.

You must examine each trust account at least three time each year in accordance with the specified examinations periods in the following schedule.  The examination periods are the same as those set down in the 1977 Audit Regulations.
​Balance Date ​Examination Periods
​Two months to 31 May ​1 July - 31 August
​Five months to 31 October 1 December - last day of February
​Five months to 31 March ​1 April - 30 June

You  must provide an annual audit report to the Authority within 10 working days of completing the final audit for the year. This audit report must be signed and use the Authority's template or be in accordance with it.  You must also supply a signed copy of the audit report to the agent.  The Authority will acknowledge the receipt of the audit report submitted by you within 10 working days.

You must promptly report to the Authority any of the following matters:

  • Trust account records that do not clearly show the trust account balances of each client or that are not kept in a manner that enables them to  be properly audited
  • Any matter involving dishonesty, or a breach of law on the part of the agency
  • A loss or deficiency of trust account money, or a failure of the agency to account for any trust account money
  • Any failure to comply with the provisions of the Real Estate Agents Act 2008 or the Real Estate Agents (Audit) Regulations 2009 relating to the agency's trust accounts
  • Any other matter such as errors, irregularities, or mis-statements in a trust account that you believe should be reported.
  • You must advise the Authority whenever any notification of an inactive or reactivated trust account is received from an agent (in accordance with section 25 of the Audit Regulations).

Are residential property letting trust accounts covered?

Trust accounts that deal solely with residential letting are not covered under the Real Estate Agents Act or Audit Regulations as residential property letting is excluded from the definition of real estate agency work.  Refer to section 4 of the Act.
You are not required to provide reporting to the Authority for any audits carried out on trust accounts related to residential property letting, providing the trust account(s) deal solely with residential letting transactions (trust accounts that deal with commercial property leasing are covered under the Act and Regulations).  Where both real estate and residential property letting transactions occur within one trust account then you must provide an audit report based on your findings as they pertain to all transactions in the account.

What do new agencies do?

Before any new agency receives any money in respect of their first transaction, they must inform the Authority of their nominated trust account auditor.
Notification from new agencies to the Authority must comply with the provisions above in respect of the transitional provisions.

What are the audit fees?

Any fees payable by an agency to an auditor are to be agreed by the agent and the auditor.  The cost of auditing any trust accounts is the sole responsibility of the agent.

Audit Programme Guide

The Authority has developed an audit programme guide to assist you in meeting the minimum requirements of the 2009 Audit Regulations.
You are not required to complete this guide or return it to the Authority.