Trust Funds
AREC's trust account audit authority is intended primarily to:
AIncrease state revenue through fines
BProtect the public by ensuring brokers handle client funds properly✓ Correct
CVerify that brokers are profitable
DEnsure all commissions are correctly reported to the IRS
Explanation
AREC's authority to audit trust accounts is a consumer protection measure. Proper trust accounting safeguards client funds from misappropriation, ensures accurate record-keeping, and maintains public confidence in the real estate profession.
Related Alabama Trust Funds Questions
- When there is a dispute over earnest money between a buyer and seller in Alabama, the broker should:
- Which of the following BEST describes 'commingling' of funds?
- In Alabama, a qualifying broker's trust account must be reconciled:
- A broker receives an earnest money check from a buyer but the seller has not yet accepted the offer. The broker should:
- A broker may disburse funds from a trust account based on:
- In Alabama, a qualifying broker who manages property for owners must maintain:
- How long must Alabama brokers retain trust account records?
- Conversion of trust funds occurs when a broker:
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