Kingman companies make honor roll after state audit
8/30/2013 6:00:00 AM
KINGMAN - Two local property management companies have made Arizona's Broker Audit Honor Roll, which recognizes brokers who successfully pass a stringent electronic audit.
RE/MAX Preferred Professionals and Eagle Realty were named to the Arizona Department of Real Estate list, which is released quarterly. Both were notified in July 2012 that their property management records, receipts and financial transactions would be electronically audited. The companies were told in June that they had earned top marks on their audits.
"This is a big deal," said Helena Baughman, property manager and Realtor at RE/MAX Preferred Professionals. "It's an honor to make the list because we handle hundreds of thousands of dollars every month in rent, security deposits, insurance and bills. There's a massive amount of accounting that has to be done. And to be on the honor roll says we are very diligent in our duty and understand the importance of accountability."
Baughman said it took two days for her to compile the massive list of documents requested by the ADRE and scan them onto computer disks. The list included copies of 10 current property management agreements, 10 current tenant leases, a list of owners and tenants under contract, copies of bank statements and account signature cards, copies of monthly trust account reconciliations and copies of client ledgers.
Also, the state asked for a report showing total security deposits, a receipts and disbursement journal and copies of any ledgers of accounts containing money on behalf of clients or tenants. The audit period covered Dec. 1, 2011 to May 31, 2012. RE/MAX Preferred Professionals manages about 500 properties that include single-family homes, apartments, duplexes and commercial buildings.
This is the first time RE/MAX has been audited electronically, said Baughman. Before, an ADRE agent would visit the office and stay for most of the day, going through records and writing notes.
Sarah Dobbins, chief of staff for the ADRE, said the Broker Audit Honor Roll recognizes brokers who passed an audit during the quarter leading up to the list's publication in the Real Estate Commission Bulletin. Dobbins said electronic audits were first used in May 2010, along with onsite audits in place for years, to increase the frequency of audits performed by the department.
"When a company is listed on the honor roll, it means they have been found in substantial compliance during an audit," said Dobbins.
From Jan. 1 to June 30 of this year, when the list was published in the first two bulletins, 35 brokers in the state were compliant and named to the honor roll. Another 22 brokers received Advisory Letters of Concern and/or were placed on a re-audit list to ensure continued compliance. Another 18 brokers were referred to the enforcement and compliance division for possible disciplinary action. The list includes only a portion of the state's 7,255 designated and self-employed brokers in Arizona and changes as more companies are audited.
Wayne Wissinger, owner of Eagle Realty, said he compiled required information and hand-delivered it to make sure it got there. Wissinger, whose company manages about 50 properties, said annual audits are a necessity because the state agency had problems with money missing from trust accounts held by property management companies in the past.
"It's a pretty big deal to make the honor roll list," said Wissinger. "I'm really proud. It's nice when you get one of those scary certified letters from the Arizona Department of Real Estate to open it and find you're on the nice list and not the naughty list."