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Three-Way Trust Account Reconciliation
The mandatory fiduciary reconciliation verifying bank statement balance, general ledger cash account, and subsidiary client ledgers match to the cent.
Three-Way Trust Account Reconciliation is the gold-standard fiduciary accounting procedure verifying that three separate financial balances match to the cent: (1) the bank statement cash balance, (2) the general ledger trust cash control account, and (3) the sum of all individual client or tenant subsidiary ledgers.
Mandated monthly by real estate licensing commissions (e.g., California DRE), failure to maintain three-way balance is the primary trigger for licensing revocations.
Broker Trust Accounting Three-Way Balancing Architecture
Monthly fiduciary reconciliation verifying bank statement, cash journal, and client subsidiary ledgers
Frequently Asked Questions
What is a three-way reconciliation in broker trust accounting?
A three-way reconciliation verifies that three independent balances match exactly: the bank statement balance, the general ledger trust cash account, and the sum of all individual client or tenant ledgers.
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