Frequently Asked Questions
Disclaimer: Please note that the advice contained here is general advice only as we are not aware of your personal circumstances. We recommend that you seek professional advice relating to your circumstances before making any decisions.
Q: What is Management Rights?
A: A management right business traditionally has two parts to it.
- The management and caretaking agreement with the Body Corporate.
- The letting agreement with individual unit owners.
When purchasing management rights, there are two contracts.
- The managers residence
- The Management rights business.
Contact BAMR regarding the correct Entity/Business Structure before entering into a contract.
The use of BAMR, a recognized management right industry professional, will ensure there are no delays in the purchase process and that you are ready to settle on time.
Q: Do I need to have the PAMDA Trust account?
A: The establishment of a trust account is a mandatory requirement to ensure the protective custodianship of money belonging to letting pool owners and tenants.
Trust funds for the Management Rights industry in Queensland is governed by the following Queensland State Legislation.
- Property Agents and Motor Dealers Act 2000 ( as amended): The Act
- Property Agents and Motor Dealers Regulation 2001 ( as amended)
Both of these are commonly referred to as PAMDA.
Q: How often will I be audited?
A: In total there are 3 on site visits required within the license period. Please refer to Section 402 of PAMDA.
Q: What is a three (3) way balance?
TRUST ACCOUNT DAILY TRANSACTION SEQUENCE
3 WAY MONTHLY RECONCILIATION REQUIRED
| CASHBOOK JOURNAL |
OPENING BALANCE PLUS RECEIPTS LESS PAYMENTS |
=$ BALANCE |
| BANK RECONCILIATION |
STATEMENT BALANCE PLUS O/S DEPOSITS LESS O/S PAYMENTS |
=$ BALANCE |
| CONTROL LEDGER ACCOUNT |
SUM OF EACH OWNERS LEDGER BALANCE |
=$ BALANCE |
NOTE: PAYMENTS CANNOT EXCEED RECEIPTS AS THE TRUST BANK ACCOUNT NOR ANY INDIVIDUAL OWNER’S LEDGER ACCOUNT IS PEERMITTED TO BE OVERDRAWN AT ANY TIME. ALL THREE (3) CLOSING BALANCES MUST AGREE AT END OF MONTH (EOM) BEFORE ANY DISTRIBUTION TO OWNERS AND MANAGER.
Q: What reports will my auditor require?
A: For each month, the auditor will require:
- 3 way reconciliation report prior to Distribution to owners and Post distribution.
- Cheques issued and electronic transfer report (EFT)
- Cashbook history for the month
- Banking register for the month
- Unit statements
- Deposits held in trust at EOM.
- Receipts Register
- Trust account bank statement ( original not internet copy)
- Trust cheque book.
Q: I have sold my Management rights Business, What do I need to do?
A: Notify BAMR of the following;
- Settlement date
- Forwarding contact details
- Make an appointment to discuss your ongoing Accounting, Taxation and your final Audit licence obligations.
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