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Trust Accounting
The strict fiduciary bookkeeping practice of maintaining client and tenant funds in segregated bank accounts separate from property management operating cash.
Trust Accounting is the strict, legally mandated practice in property management of maintaining client and tenant funds in dedicated, non-interest-bearing or escrow trust accounts completely segregated from the management company's operational funds.
State real estate licensing bodies enforce rigorous audit standards on trust accounts holding security deposits, advance rents, and owner reserves.
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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