GPLC CH 6

A broker must review the monthly reconciliation statement and maintain copies in his or her files for a period of ________.

3 years

A trust account must be maintained by each broker and affiliated licensees who accepts any of the following in a real estate brokerage transaction:

Down Payments Earnest Money Deposits Security Deposits Rents Association Fees Other Trust Funds

A firm may choose to use an electronic or manual accounting system as long as the system meets the following criteria:

Include all the components required by law and sound business practices Be readily accessible Be in a readily understandable format Be reasonably available to any authorized representative of the Commission

A broker may allow commissions due the broker that are being paid from funds of others held in the broker's designated trust or escrow account to remain in the account provided that ______ and _______.

The broker's accounting system for trust or escrow accounts designates those commissions as the broker's funds and properly accounts for them The broker removes from the account every month any of the broker's funds that exceed the minimum necessary to comply with the bank regulations previously discussed

In the case of abandoned funds within a trust account, a licensee may not disburse those funds from a trust account unless:

The licensee's written authorization to hold those funds requires a particular disbursal. The licensee has complied with the requirements of the Disposition of Unclaimed Property Act. The licensee has complied with all other statutory or court-ordered requirements that are appropriate to the circumstances.

Each broker who is required to maintain a trust account must also maintain an accounting system in which each trust or escrow deposit is detailed with the following:

The names of buyer and seller or tenant and landlord or member and community association or broker The amount and date of deposit The identification of property involved The amount, payee and date of each check drawn on the escrow account in connection with that deposit

In the event that the trust liability and the bank balances do not agree, the reconciliation statement must contain _________ and _______ with reference to shortages or overages of funds in the account(s).

a description or explanation for the difference any corrective actions taken

All real estate licensees must deposit all funds or place any valuables held on the behalf of others in

a trust account.

A licensee must place any trust funds in the trust account ______.

as soon as possible after receipt

A trust account so designated and registered with the Commision will not be subject to_______ or_________.

attachment garnishment

A broker may maintain his funds in a trust account only when the deposit is ______ and is for the purpose of maintaining a ________ or to cover a _______.

clearly marked as the broker's deposit minimum balance to keep the account open service charge

Any time the Commission contracts a broker for the purpose of conducting a trust account examination or at the time a broker is renewing his or her license, the broker may _________ in lieu of the Commission's representative; however the CPA's report must ________.

elect to use his own CPA provide the trust account reports take the form provided in the laws

If a customer or client of a salesperson asks for a refund of the earnest money, the salesperson must ______ and should not make any statements as to whether a refund is possible.

immediately refer this customer or client to his employing broker

Trust funds are held in the protection of escrow and can not be used

in order to pay the broker's or the firm's debts.

A broker who disburses trust funds contrary to the terms of the contract will be considered to have demonstrated _________ by the Commission.

incompetence

Under Georgia Law, a broker who does not accept trust funds in transactions is ________.

not required to maintain a trust account

A trust account must be maintained in a _______ in Georgia and designated as such.

separate, federally-insured bank checking account

A broker's trust liability is the ______.

sum total of all deposits received, required by contract to deposit and being held by the broker at any point in time

In regards to a non-resident broker conducting business in GA, he or she may maintain a trust account in their resident state, provided that _____.

the Commission is authorized to examine the account at any time the Commission chooses

Any copies of documents and other records may be maintained in any records storage system that utilizes paper, film, electronic, or other media provided that __________

the licensee can produce true and correct copies of such documents and records upon reasonable request by GREC and at reasonable cost to the Commision.

Commingling is _______ and is against the law and could result in disciplinary action.

the mixture of the broker's personal funds or the firm's funds and trust funds

Brokers may maintain more than one trust account at one time, but must notify GREC _____ within ____ of opening the account.

the name of the bank in which each account is located as well as the accounts name or number one month

A broker never entitled to any part of the earnest money as part or all of his or her commission or fee until

the transaction has been fully consummated or terminated.

It is a violation of the law in GA for a broker to _____ any portion of trust funds while those funds are being held. Trust funds must be ______ from the broker's personal funds or the firm's funds.

use held separate

A broker may claim earnest money as commission provided that the sale transaction has closed, or the lease transaction has completed, or the broker has obtained a _____ from all parties _________.

written agreement agreeing that the broker is entitled to the commission

Under Georgia law, a broker who is required to maintain a trust or escrow account must produce, at least once a month, a ________

written reconciliation statement.