NSW trust account audit deadlines: every date that matters

Two regimes, two regulators, two deadlines

Trust money is money held on behalf of someone else, and every profession that holds it is regulated on the assumption that it might be misused. In New South Wales the two regimes that catch most practices are the Legal Profession Uniform Law, administered through the Law Society of NSW, and the property services legislation administered by NSW Fair Trading. They are genuinely different engagements with different standards and different dates, which is why a single accountant who does 'trust audits' generally is worth a second look.

Solicitors' trust accounts: 31 May

A law practice that received or held trust money at any point during the trust year must have its trust records externally examined, and the External Examiner's Report lodged with the Law Society of NSW by 31 May. The obligation is triggered by having held trust money during the year — not by holding a balance at year end — so a practice that opened and closed a trust account mid-year is still caught.

The examination is governed by the Legal Profession Uniform Law (NSW) and the Legal Profession Uniform General Rules. Eligibility to act as an external examiner sits in sections 155–156 of the Uniform Law and Rule 65 of the General Rules, and the examiner must also have completed approved training through the Law Society of NSW, the Law Institute of Victoria or the Legal Practice Board of Western Australia.

Real estate and conveyancer trust accounts: 30 September

Licensees holding trust money — real estate agencies, property managers, strata managing agents, conveyancers, and business and stock and station agents — must have the trust account audited for the period 1 July to 30 June, and lodge that audit with NSW Fair Trading by 30 September. Lodgement is made through the Fair Trading Auditor's Report Online portal, which begins accepting the current year's audits from 1 July.

The audit is performed under the Australian Standards on Assurance Engagements, principally ASAE 3000 and ASAE 3100, and assesses whether the licensee has complied with the relevant Acts and Regulations in all material respects. An audit lodged from 1 October onwards is recorded as late and may attract a penalty.

The dates in one table

What happens if you miss the date

Neither regulator treats a late lodgement as fatal, but both treat it as a signal. For law practices, late lodgement is a compliance matter the Law Society follows up and it can complicate a practising certificate renewal. For licensees, a late audit may attract a penalty and tends to draw closer attention to the following year's file. In both cases lodging quickly beats lodging perfectly — the worst outcome is a practice that goes quiet because the file is untidy.

How to make the deadline comfortably

• Reconcile the trust account monthly and keep the reconciliations — most qualifications we see are late or missing reconciliations, not misappropriation.
• Deal with overdrawn ledgers as they arise rather than at year end.
• Pay unclaimed money to Revenue NSW on the required cycle instead of letting it sit.
• Engage the examiner or auditor two months before the deadline, not two weeks.
• Keep records of any trust account opened or closed during the year — these are the items most often forgotten.

Dates in this article apply to New South Wales. Other states operate their own trust account regimes with different periods and deadlines. If you are licensed or practising interstate, confirm the position for that jurisdiction before relying on these dates.