Now you have sold your Management Rights – What to do at settlement
By Kate Elliot and Deslea Firth
Once you have sold your Management Rights there are some important steps you need to remember when handing over your business to the purchaser.
The Agent/Licensee should involve the auditor who will conduct the final audit in the settlement process. It is essential the Agent/ Licensee organises their final Audit prior to the transfer of any funds to the purchasers Trust Account. Amounts in dispute may affect or delay the settlement of a business.
- Advise your Trust Account auditor of your settlement date, a final audit MUST be completed on this day.
- Once your trust account is at NIL balance, you will need to close the bank account and request a final bank statement from your bank.
- Forward the bank statement to your auditor for them to prepare the AFA Form 5 to notify the OFT you have closed your trust account and advise your auditor no longer acts for you. You have 60 days from the closure date to do this.
- Lodge the Final and Sold Audit report with the OFT.
One last important thing to remember is as a licensee it your responsibility to keep your records for a period of 5 years, even after you have sold your complex. This is important as we have seen licensees pass over all their Trust Account records (printouts and computer backups) to the purchaser, and then not have access to records in the event of any disputes or questions.
For further information on the sale process of your Management Rights business please fill out the form below, or contact our team today on 1300 667 897.
All information provided here is general in nature only, in preparing it we did not take account of your individual and financial situation or particular needs.