Reconciling a broker trust account three ways every month
Three balances have to agree. The bank statement, the trust ledger of the brokerage and the sum of every individual client sub ledger. Where they do not, an explanation gets written down and kept, and states set both the cadence and the retention themselves. Examiners tend to find the same pair of things: a worksheet nobody signed and a variance nobody explained. The build is unglamorous. Pull the statement, rebuild sub ledger balances out of the property system, then return the exceptions as a list naming the deposit behind each one.
A brokerage runs on dates that were calculated by a person reading a contract, and on leads that arrive in a different shape from every portal.
The listing data is already structured. It lives in the MLS, and since RETS was retired the modern way to reach it is the RESO Web API, which returns OData against the RESO Data Dictionary. Almost nothing else in the transaction is structured. The purchase agreement arrives as a signed PDF that was structured data inside the forms platform ten minutes earlier and got flattened on the way out.
- QuickBooks Online
- AppFolio
- Excel
When this is the wrong thing to build
Pick something else if the brokerage never holds earnest money or security deposits, because title or the closing attorney holds everything. It is also premature where the sub ledgers exist only as a bank export, since there is nothing to reconcile against until a ledger per client exists.
The constraint that shapes it
Negotiating, advising on price or terms, and soliciting are licensed activities performed under a supervising broker. More on how this sector works.
Two sources of truth. One queue of the rows that do not line up. Read what this shape is, or start from one of these.
- Widening a conflicts search past exact spelling
- Rebuilding a billable day from the trail the systems already keep
- Assembling the monthly three way trust reconciliation packet
- Matching refrigerant bought against refrigerant put into equipment
- Finding the parts the truck says it still has
- Joining one client across the ledger and the tax file
- What is a three way reconciliation on a real estate trust account?
- How often does a broker have to reconcile the escrow account?
- What do state auditors look for in broker trust account records?
- How do I reconcile security deposits held for owners?
- Why does my trust ledger not match the bank statement?
Back to real estate, or see how this is priced and scoped.