AUDIT SERVICES U.S., LLC

COMPLIANCE CONCERNS

After a closer review of the unclaimed and abandoned property situation, most states have recognized the following facts:

Many businesses that are required by law to file and report unclaimed funds were unaware of the existing unclaimed and abandoned property reporting laws and consequently were either not filing reports or filing reports improperly.
Many businesses that are filing reports are in many cases under-reporting. For example, banks could be overlooking cash accounts, cashier checks, IRA's and CD's. Corporations could be overlooking pension/retirement plans, dividend reinvestment plans, and equity and debt of the company. Insurance companies could be overlooking the necessity of reporting drafts, annuities or matured policies. All types of unclaimed property are often written off to income or to surplus accounts.
Due to the huge volume and size of the reporting holder community, total reporting compliance cannot be attained by most State Unclaimed Property Offices. States have begun to increase the size of their compliance staff and use external auditing companies in an attempt to bring holders of unclaimed and abandoned property into compliance.

Our auditing experience has shown that less than one percent of holders of unclaimed and abandoned property are truly in compliance with the law.

Vast changes and new business developments have created new types of reportable unclaimed and abandoned property.

The current trend of decentralization of accounting records for corporate subsidiaries and divisions have imposed new problems for the unclaimed and abandoned property auditor.

Large amounts of unclaimed and abandoned property are being written off and not just into standard General Ledger miscellaneous income accounts. These amounts are being buried into multi-leveled accounting structures and may only be recovered with the knowledge of prior company controllers on specific and related industries.

An increasing number of holders located outside your State will not accurately report and remit unclaimed and abandoned property until they are audited.