Transaction Files:
Each transaction file whether PENDING, CLOSED, FAILED,
or CANCELED must be indexed by TIN and by client or customer
name. Each file should contain all of the following records IF
APPLICABLE to the transaction to be in compliance with K.A.R. 86-3-10
and shall be retained for a period of 3 years:
- agency agreement with seller
- agency agreement with buyer
- transaction broker addendum
- transaction brokerage agreement
- offers, counteroffers
- contract, including all amendments, and addenda
- lot reservation agreement
- commercial lease
- option
- receipt for purchase agreement and earnest money
- closing statements
- authorization to disburse earnest money on transaction which did
not close
- any other record generated in connection with the transaction (this
would include phone notes, e-mails, inspection reports, estimated
closing costs, correspondence, surveys, appraisals, title reports,
and any documentation generated during the transaction.)
Trust Account Records (if applicable)
A complete record of all monies received or escrowed on real estate
transactions must be maintained:
- deposit slips showing transaction number, date of deposit, amount
and where deposited
- monthly trust account bank statement, canceled checks and deposit
slips
- a check register which shows the chronological sequence in which
funds are received and disbursed
- for funds received: date of deposit, transaction number,
amount
- for disbursement: date, transaction number, payee, amount
- the current balance
- a ledger for each transaction, including:
- names of principals
- property address
- transaction number
- amount
- date of each deposit
- check number
- date of check
- payee
- amount of each disbursement
- the current balance
- a ledger for broker's funds, if applicable
1. These records would need to be scanned into a system by indexing
each with a TIN and client or customer name.
2. The system would need to allow the auditor or investigator to
be able to retrieve the documents and also have the ability to print
the documents.
3. This software must be updated periodically so that records are
always readable.
4. The system should be in a format that once scanned documents
may not be altered at a later time.
5. The original contract should be scanned to ensure a clear scan.
K.A.R. 86-3-10 states that the broker must have true copies in the broker's
files.
6. Contracts that have been faxed back and forth are sometimes reduced
to the point that printed language is unreadable and would not be allowed
as a true copy of the original contract.
7. Brokers would need to monitor the scanning process before shredding
the original to make sure they have a clear scan.
