Casting our minds back to this time last year we can remember the issues that many accountants faced assisting clients in their licence applications to the Property Services Regulatory Authority. Now one year later all licence holders are required to submit their renewal applications to the Authority in advance of the upcoming renewal date.
Here at OmniPro we have created a Combined Guidance Document and Work Programme that will help accounts in ensuring compliance with the Client Money Regulations as set out in Statutory Instrument No. 199 of 2012 Property Services (Regulation) Act 2011 (Client Moneys) Regulations 2012. We have provided this as a free resource to members of our Accountants Resource Centre. To obtain membership simply log onto our site at the link above, create a username and password, and follow the link to download this free Guide and Work Programme.
To assist firms we have set out:
- The Renewal Application Process and Required Documents
- The Systems and Accounting Procedures Expected to be in Place for the Accountants Report
Renewal Application Process
The Property Services (Regulation) Act 2011 (the “Act”), section 35, requires licence holders to apply to renew their licence 6 weeks before the expiration of the current licence. For all licence holders who were granted there licence on commencement in 2012, the expiration date of these licences is 5 July 2013. To comply with the legislation the application deadline for renewal of these licences is 25 May 2013.
The renewal application form should be accompanied by the following:
- Accountant's Report
- If renewing Licence Types A, B or C or combinations of these the renewal should be accompanied by Form PSRA/S35 – Renewal ABC
- If renewing Licence Type D the renewal should be accompanied by Form PSRA/S35 – Renewal D
- If renewing Licence D and any other licence type submit both forms
Copies of the Forms can be downloaded directly from the Authority website at the following address (http://omnipro.us1.list-manage1.com/track/click?u=636fd6b48946fda08d2877984&id=c8915b838c&e=580c995cf0) and are included as Appendices to this guidance.
2. Tax Clearance Certificates
Tax Clearance Certificates must be provided in respect of the business and each of its directors/partners.
3. Professional Indemnity Insurance
The licence renewal form will specify whether or not a policy must be submitted.
4. Duplicate Certificate of Incorporation
This is required for companies only and must be dated and signed within 4 weeks of the date of the application.
5. Licence Fee
€1,000 for the business and €100 for each Principal and Employee.
6. Contribution to the Compensation Fund
€200 for the business/company and €50 for each Principal and Employee.
For those licensees that handle client monies, they must ensure compliance with the following requirements as detailed below:
- Client monies must be held in a designated client account maintained in the State (Regulation 4);
- Client accounts must be maintained at the same bank unless otherwise authorised by the Authority (Regulation 5);
- Accounting records must be maintained for a minimum period of 7 years (Regulation 5);
- All client monies received by the licensee must be paid, without unnecessary delay, into the client monies account (Regulation 6);
- A client monies account is to be used for the sole purpose of client monies (Regulation 6);
- Payments/withdrawals from client monies account is allowed only in specific circumstances where funds are available and the licensee is authorised to make the payment (Regulation 6);
- The licensee is duty bound to provide a statement of fees and outlays to clients as soon as possible (Regulation 8);
- A licensee is permitted to operate an office account to facilitate the payment of fees due from clients (Regulation 9);
- Accounting records and relevant supporting information shall be maintained by the licensee to identify client money transactions (Regulation 10);
- The minimum accounting records to be maintained by the licensee shall be:
- A cash book (separating client and office transactions);
- An office ledger and client ledger;
- A record of bank lodgements;
- A record of transfers between client accounts;
- A bank account register detailing all accounts held;
- Detailed client files;
- Copies of statements and outlays;
- Copy of each balancing statement completed at 6 monthly intervals;
- Copy of each Accountant’s Report (Regulation 11);
- Furnish to the accountant or auditor information as requested to enable the accountant or auditor to assess compliance with the Regulations (Regulation 13);
- Interest earned on specific interest bearing client accounts shall be treated as client monies and paid to the individual client (Regulation 14); and
- Any monies withdrawn from the client account in contravention of the Regulations shall be made good by the licensee (Regulation 15).
For those licensees that do not handle client monies, they must ensure compliance with the following requirements as detailed below:
- To deposit client monies in a relevant account nominated by the client (Regulation 4(2));
- To pay monies which have been deposited in error to the non relevant account shall be paid to the relevant account as soon as the licensee becomes aware of the error (Regulation 16(9));
- To pay monies to a relevant account without unnecessary delay (Regulation 16(1));
- To issue a receipt for all amounts received in cash (Regulation 16(1));
- To maintain up to date records on behalf of each client (Regulation 16(2));
- Fees receivable by the licensee shall be paid directly in to the office account and maintain supporting documents in respect of fees charged (Regulation 16(4&5));
- Books of account shall be maintained in relation to clients’ monies. The following shall be maintained for each client:
- Separate clients ledger account;
- Separate annual service charge account; and
- A sinking fund contributions account (Regulation 16(6)).
- Furnish to the client a statement of fees and outlays payable by the client in respect of property management services (Regulation 16(7));
- The licensee shall maintain the following accounting records:
- A cash book separately identifying office and client transactions;
- An office ledge and client ledger
- A record of bank lodgements and monies received;
- A bank account register;
- Copy of all bank account statements;
- Copy of statement and fees; and
- Copy of each accountants reports (Regulation 16(8))
- Furnish to the accountant or auditor information as requested to enable the accountant or auditor to assess compliance with the Regulations (Regulation 13).