CPPREP4125_AE_Kn_3of3_LMS

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School

TAFE NSW - Sydney Institute *

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Course

41419

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Accounting

Date

May 7, 2024

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docx

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Uploaded by CaptainDuckPerson1026

Knowledge assessment 3 of 3 Criteria Unit code, name and release number CPPREP4125 - Transact in trust accounts (1) Qualification/Course code, name and release number CPP41419 - Certificate IV in Real Estate Practice (1) Student details Student number 801529186 Student name Theresa Vy Phuong Pham Assessment declaration This declaration only needs to be completed if you are not submitting your assessment online.  This assessment is my original work and no part of it has been copied from any other source except where due acknowledgement is made.  No part of this assessment has been written for me by any other person except where such collaboration has been authorised by the assessor concerned.  I understand that plagiarism is the presentation of the work, idea, or creation of another person as though it is your own. Plagiarism occurs when the origin of the material used is not appropriately cited. No part of this assessment is plagiarised. Student signature and Date Theresa Vy Phuong Pham 29/05/2023 Document title: CPPREP4125_AE_Kn_3of3_LMS Page 1 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

Document title: CPPREP4125_AE_Kn_3of3_LMS Page 2 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

Version: 20210826 Date created: 03 July 2020 For queries, please contact: Technology and Business Service SkillsPoint TAFE NSW Ultimo © 2020 TAFE NSW, Sydney RTO Provider Number 90003 | CRICOS Provider Code: 00591E This assessment can be found in the: Learning Bank The contents in this document is copyright © TAFE NSW 2020, and should not be reproduced without the permission of the TAFE NSW. Information contained in this document is correct at time of printing: 5 May 2024. For current information please refer to our website or your teacher as appropriate. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 3 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

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Assessment instructions Table 1 Assessment instructions Assessment details Instructions Assessment overview The objective of this assessment is to assess your knowledge as would be required to conduct transactions in real estate trust accounts. Assessment event number 3 of 3 Instructions for this assessment This is a written assessment that will assess your knowledge of the unit. This assessment is in one part: Part 1: 7 Short answer questions The assessment also contains an assessment feedback form. Submission instructions Where possible, complete and submit this assessment online via the TAFE NSW online learning platform. Upload all the required assessment files in the assessment area on the online learning platform. Alternatively, hand all required assessment files to your assessor for marking. Make sure you have added your name to the bottom of each page of the assessment. It is important that you keep a copy of all electronic and hardcopy assessments submitted to TAFE NSW and complete the assessment declaration when you submit the assessment. What do I need to do to achieve a satisfactory result? To achieve a satisfactory result for this assessment, you must answer all questions correctly. What do I need to provide? Computer with internet access; and Microsoft Office. What will the assessor provide? Access to this assessment and supporting online resources. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 4 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

Assessment details Instructions Due date and time allowed Fully online students should refer to their Training Plan for due dates, other students should refer to the Unit Assessment Guide for due dates. The indicative time to complete this assessment is 40 minutes. Supervision This is an unsupervised assessment. You may access your referenced text, learning notes and other resources. Your assessor may ask for additional evidence to verify the authenticity of your submission and confirm that the assessment task was completed by you. Assessment feedback, review or appeals In accordance with the TAFE NSW policy Manage Assessment Appeals, all students have the right to appeal an assessment decision concerning how the assessment was conducted and the outcome of the assessment. Appeals must be lodged within 14 working days of the formal notification of the result of the assessment. If you would like to request a review of your results or if you have any concerns about your results, contact your teacher or head teacher. If they are unavailable, contact the student administration officer. Appeals are addressed in accordance with Every Student’s Guide to Assessment. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 5 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

Part 1: Short answer Read the question carefully. 1. Explain how authorisation is given for payments made from the trust accounts, in the following circumstances: Activity Your answer a) Settlement of a sale and payment of commission to the agent Payment to the agent in the form of commission is contingent upon the receipt and verification of the order. Furthermore, the commission is to be disbursed in line with the terms of the sales contract that received mutual consent from all involved parties. It is essential for all parties to adhere to their respective duties and obligations to facilitate a transaction that is both smooth and equitable. For the agent to receive their commission, they must issue an invoice, which is subject to approval by the individual managing the trust account. b) Payment of an invoice on behalf of a landlord When a landlord is due payment for services provided, they are required to submit an invoice. This invoice must then be validated by the person in charge of the trust account before the landlord can be issued their payment. In the context of a managing agency agreement, payments are authorized up to a specified amount; if the payment exceeds this threshold, written consent is necessary. Additionally, there must be sufficient funds available in the ledger to cover the payment. c) Payment of management fees from a landlord As part of compiling their rental statement, a fee for management services will be accounted for and subtracted from their earnings from rent. The details of this deduction are outlined in the lease agreement established with the property owner. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 6 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

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Activity Your answer d) Payment of advertising expenses on behalf of a vendor The agent is authorized to cover the costs of advertising for the seller, if there is a pre-existing arrangement permitting such transactions. This authorization would be specified within the terms of the sales agency contract as well as the outlined marketing strategy and financial plan. 2. Summarise the actions an Agent would need to take if they received an invoice for an emergency plumbing repair at a Landlord’s property. The invoice is for an amount more than the amount specified in the Management agreement. The plumber has given 30 days to pay the account. Upon receiving a bill for urgent plumbing work at a rental property, the initial action for the agent is to notify the property owner about the emergency and the associated costs. Should the expense for the repair surpass the limit set in the property management contract, the agent must obtain the property owner's consent prior to settling the bill. After receiving the go-ahead, the agent is then able to process the payment within the given timeframe of 30 days. It is crucial for the agent to consistently update the property owner and to keep precise documentation of all financial transactions involved. 3. Summarise the actions the licensee would need to take if there were unclaimed funds in the trust account. If there are funds in the trust account that have not been claimed, it is the responsibility of the licensee to undertake the appropriate actions to manage these funds correctly. The initial action involves trying to reach out to the fund's rightful owner to alert them of the unclaimed money. Should the owner be unreachable or fail to claim the funds within a designated timeframe, the licensee might be obligated to transfer the funds to the state's unclaimed property office, as dictated by local regulations. It is equally critical for the licensee to keep precise and comprehensive records of all financial activities and to ensure that all related documents are properly organized and maintained. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 7 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

4. Explain how long and where a licensee is required to keep all trust account records. Include in your answer the correct section from the Property and Stock Agent Act 2002 and/or the Property and Stock Agent Regulations 2014 (NSW). Under the Property, Stock and Business Agents Act 2002 (NSW), specifically Section 33, it is mandated that a licensee preserve all records associated with the trust account for at least three years. These documents must be stored at the main office of the licensee in New South Wales. The documentation must encompass every transaction, receipt, and disbursement conducted through the trust account. It is imperative for the licensee to keep these records current and precise, and to ensure they are available for review during audits. Not maintaining accurate records can lead to punitive measures and legal repercussions. It is therefore essential for the licensee to adhere to the legal standards and ensure the trust account records are managed correctly. 5. Discuss how password security and electronic tracking of transactions assist in the security and maintenance of the trust accounts. To safeguard trust accounts and ensure their proper management, the implementation of password protection and the electronic monitoring of transactional activity are vital. Password protection restricts account access to verified individuals, thereby lowering the potential for unauthorized or fraudulent actions. The use of electronic monitoring creates a verifiable record of all trust account- related actions, aiding in the detection of any inconsistencies and bolstering the overall security of the account. Through the adoption of these security protocols, those responsible for managing trust accounts can reduce the likelihood of fraudulent misuse and ensure adherence to legal and regulatory standards. 6. The licensee in charge has legislative responsibilities, under the Property and Stock Agents Act 2002 to schedule external audits of the trust accounts, and obligations to schedule regular internal audits of the trust accounts. When should the licensee schedule the following: Document title: CPPREP4125_AE_Kn_3of3_LMS Page 8 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

a) External audits Annual external reviews of trust accounts are mandated by Section 33 of the Property, Stock and Business Agents Act 2002 (NSW). b) Internal audits/Review How often a licensee conducts internal audits or reviews can differ based on the specific internal rules and guidelines they follow. Nonetheless, it's often advised to carry out internal audits more frequently, such as every quarter or twice a year, to maintain consistent adherence to regulations and to promptly identify any potential concerns. 7. Outline the maximum penalty for not paying trust monies collected on behalf of a client into the trust account. In your answer refer to the correct section of the Property and Stock Agents Act 2002. The highest fine is set at 100 Penalty Units, as specified in Section 86. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 9 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME:

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Assessment feedback NOTE: If you are submitting through an online learning platform, the assessor will give you feedback via the platform. Assessment outcome ☐ Satisfactory ☐ Unsatisfactory Assessor Feedback ☐ Are you assured that the evidence presented for assessment is the student’s own work? ☐ Was the assessment event successfully completed? ☐ If no, was the resubmission/re-assessment successfully completed? ☐ Was reasonable adjustment in place for this assessment event? If yes, ensure it is detailed on the assessment document. Comments: Assessor name and date: NOTE: Make sure you add your name to the footer, so it appears at the bottom of each page. Document title: CPPREP4125_AE_Kn_3of3_LMS Page 10 of 10 Resource ID: TBS_19_001_CPPREP4125_AE_Kn_3of3_LMS STUDENT NAME: