client monies toolkit - migration agents registration

Client Monies ToolkitFor registered migration agents

Your guide to best practice for handling your clients’ monies

© Commonwealth of Australia 2012

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The Office of the MARA has made every effort to ensure that, at the date of publication, this document is free from errors and that advice and information drawn upon have been provided in good faith. Neither the Office of the MARA nor any person or organisation associated with the preparation of this document accepts liability for any loss which a user of this document may suffer as a result of reliance on the document and in particular for:

• use of the document for a purpose for which it was not intended;• any errors or omissions in the document• any inaccuracy in the information or data on which the document is based or which are

contained in the document; or• any interpretations or opinions stated in, or which may be inferred from, the document.

An initiative of the Office of the MARA

RMA Client Monies Tool kit III

TABLE OF CONTENTS

1 INTRODUCTION ............................................................................................................2 1.1 What is the purpose of this toolkit? ...........................................................................2 1.1.1 Overview of the 8 core client money controls .....................................................3 1.2 All about the rules .....................................................................................................4 1.2.1 Legislative compliance framework .....................................................................4 1.2.2 Occupational competency standards for migration agents ....................................5

2 WHAT IS CLIENT MONEY? ...........................................................................................7 2.1 Definitions .................................................................................................................7 2.2 Requirements ...........................................................................................................7 2.2.1 Keep Proper Records ......................................................................................7 2.3 How is client money different from operating money? ...............................................8 2.3.1 Characteristics of a Clients’ Account ..................................................................9

3 SETTING UP THE RIGHT CLIENTS’ ACCOUNT .......................................................11 3.1 How do I set up a Clients’ Account? .......................................................................11 3.2 How do I deal with client monies? ...........................................................................12 3.2.1 Making and recording deposits and withdrawals ...............................................12 3.3 How do I reference transactions on my clients’ account? ........................................13

4 PROVIDING CLIENTS WITH A FEE ESTIMATE .........................................................15 4.1 What is a Fee Estimate? .........................................................................................15 4.2 How do I prepare a Fee Estimate? ..........................................................................16 4.3 What must be included on a fee estimate? .............................................................17 4.3.1 Necessary components of a Fee Estimate ........................................................17 4.3.2 Example Fee Estimate ...................................................................................18 4.3.3 Success fee..................................................................................................19 4.3.4 ‘No win, no fee’ .............................................................................................19 4.3.5 Agreements for Services and Fees ..................................................................20 4.3.6 Termination of services ...................................................................................21 4.3.7 Change to estimated costs .............................................................................22

5 TAX INVOICES AND RECEIPTS..................................................................................24 5.1 Tax invoices ............................................................................................................24 5.1.1 When should a tax invoice be provided?...........................................................24 5.1.2 What terms should be included on tax Invoices? ...............................................24 5.1.3 Differences between an invoice and a receipt issued by an RMA .........................24 5.1.4 Example Tax Invoice ......................................................................................25 5.1.5 Recording invoices ........................................................................................25 5.1.6 Goods and Services Tax .................................................................................26 5.1.7 Summary – Choosing to have your client pay up front for Services .......................27 5.1.8 Summary – Choosing to have your client pay after completion of Services ............28 5.2 Receipts .................................................................................................................29 5.2.1 When should a receipt be provided? ................................................................29 5.2.2 What terms should be included on receipt? ......................................................29 5.2.3 Example Receipt format .................................................................................30 5.2.4 Recording receipts ........................................................................................30 5.2.5 How does GST apply to a receipt? ..................................................................30

RMA Client Monies Tool kit IV

6 PROCESSING DISBURSEMENTS..............................................................................32 6.1 Common methods for processing disbursements...................................................32 6.1.1 Example of a Tax Invoice for a disbursement where the client has already paid the money in advance ................................................................................................. 33 6.2 Recording disbursements .......................................................................................34

7 STATEMENT OF SERVICES ........................................................................................36 7.1 What is a Statement of Services? ............................................................................36 7.2 When should a Statement of Services be provided? ...............................................36 7.3 What should be included on a statement of services? .............................................37 7.3.1 Example of a Statement of Services format ......................................................38 7.3.2 Differences between a Fee Estimate, an Invoice and a Statement of Services .......39

8 ACCOUNTS AND RECORDS MANAGEMENT .........................................................41 8.1 Accounts and records management practices ........................................................41 8.2 What is a client money ledger? ...............................................................................41 8.3 How do I maintain a client money ledger? ...............................................................42 8.4 What is an operating money ledger? .......................................................................42 8.5 How to maintain an operating money ledger? .........................................................42 8.5.1 An Example Clients’ Account Bank Statement ..................................................43 8.5.2 An Example Operating Account Bank Statement ..............................................43 8.5.3 An Example Clients’ Account Money Ledger ....................................................43

9 CONTROL AND SUPERVISION..................................................................................47 9.1 Providing control and supervision ............................................................................47

10 SELF ASSESSMENT CHECKLIST .............................................................................49 10.1 RMA Self Assessment Checklist .............................................................................50

RMA Client Monies Tool kit V

1. Introduction 1.1 What is the purpose of this toolkit?

1.2 All about the rules

1 INTRODUCTIONIf you charge, or intend to charge, your clients in advance of providing services to them, or if you collect fees and disbursement from your clients, you will need to have a sound understanding of your financial obligations as set out in the Code of Conduct.

1.1 What is the purpose of this toolkit?

► Determining what is client money

► Setting up the right Clients’ Account

► Providing clients with a Fee Estimate and Agreement for Services and Fees

► Providing invoices and receipts

► Processing disbursements

► Providing a Statement of Services performed

► Maintaining accounts and records

► Providing control and supervision

The aim of this toolkit is to assist you to meet your financial obligations and to protect the interests of your clients by:

► explaining eight core client money controls you will need to consider applying in order to successfully manage client monies;

► explaining how the eight core client money controls relate to the legislative compliance framework;

► identifying common mistakes made by registered migration agents (RMAs) in managing client monies;

► providing handy tips to help you to better manage client monies; and

► providing you with a self assessment checklist to assist your compliance with the legislative framework

RMA Client Monies Tool kit 2

1.1.1 Overview of the 8 core client money controls

What is client money?• any money you receive from a client before you have provided

them with a Statement of Services and an invoice.• any money paid by a client to you for fees and disbursements.• any refunds you receive on behalf of a client. For example,

refunds of Tribunal application fees.

Set Up the right bank accounts

• Open two bank accounts in your business name:Clients’ Account – used for client money received prior

to work being carried out and invoiced. Words “clients account” must be included in the bank statement title or descriptor.

Operating Account – used to deposit agent income and pay operating expenses.

Providing Fee Estimates and Agreements for Services and Fees• Initial Meeting with client.• Provide a Fee Estimate in writing (refer 4.3.2 for example).• Formalise verbal agreement by providing client with a signed

‘Agreement for Services and Fees.

Providing invoices and receipts• Issue client with an invoice after providing service (refer to 5.1.4

for an example)• Client provides you with payment• Provide client with receipt (refer to 5.2.3 for an example)• Deposit client money into Clients’ Account

Processing disbursements• Use client monies to pay for visa application charges and/or

disbursements.• Issue clients with receipt for using monies to make payments

such as visa charges and/or disbursements.

Providing a Statement of Services performed• Finalise visa application and provide client with a Statement of

Services and invoice (refer 7.2.1 for example).• RMA can now transfer professional fees from Client Account to

Operating Account.

Accounts and Records Management• Record transfer in client money ledger.

Control and supervision• Ensure employees are aware of Code of Conduct obligations

by providing training.• Provide a copy of the Code as part of induction and document

employee acceptance.• Ensure all employees are properly supervised.

3RMA Client Monies Tool kit

1.2 All about the rules 1.2.1 Legislative compliance framework

The following is recommended reading for understanding the legislative compliance framework that can be applied to the handling of clients’ monies:

Migration Act 1958 (Act)

Part 3, Division 5 – Obligations of registered migration agents

s.313 Persons charged for services to be given detailed Statement of Services

s.314 Code of Conduct for migration agents

Part 3, Division 6 – Migration Agents Registration Authority

s.316 Functions of Migration Agents Registration Authority

s.317 General powers of the Migration Agents Registration Authority

Migration Agents Regulations 1998 (Regulations)

Regulation 3 – Interpretation

Regulation 7I – Statement of Services

Regulation 8 (Schedule 2) – Code of Conduct (the Code)

Part 1 – IntroductionPart 2 – Standards of Professional ConductPart 5 – Fees and ChargesPart 6 – Record Keeping and ManagementPart 7 – Financial DutiesPart 8 – Duties of Registered Migration Agents to EmployeesPart 11 – Client awareness of the Code

Regulation 9A – Consumer Guide

Migration Act 1958

Section 314 Code of Conduct for migration agents

(1) The regulations may prescribe a Code of Conduct for migration agents.

(2) A registered migration agent must conduct himself or herself in accordance with the prescribed Code of Conduct.


1.2.2 Occupational competency standards for migration agents

The Occupational Competency Standards are guidelines containing nine standards which further define key competency elements specifically relating to the role of a migration agent (refer our website for a copy of these standards).

The following standards relate to your clients’ monies handling obligations

Standard Standard Performance Criteria

Standard 1 - Make preliminary contact with potential client

1.6: Disclose terms of engagement

► If appropriate, introduce client to Code of Conduct, unsigned contract and other documents that may be required.

► Set out in the unsigned contract the services planned.

Standard 2 - Agree on a course of action based on a detailed knowledge of relevant legislation and government policy and in accordance with the ethical principles and the Code of Conduct

2.2: Explain clearly the options and alternatives to the clients

► Approximate costs/disbursements are explained for each pathway/course of action.

► Clients are advised of processing timelines including potential delays

Standard 4 - Represent clients before DIAC and other bodies based on a detailed knowledge of relevant legislation and government policy and in accordance with ethical principles and the Code of Conduct

4.4: Establish appropriate communication channel with relevant authorities

► Appropriate record keeping is undertaken.

Standard 6 - Finalise matters in accordance with ethical principles and the Code of Conduct

6.4: Undertakes file closure in accordance with Code of Conduct

► Client accounts are reconciled.

► Final statements of accounts are sent.

Standard 8 – Establish a practice in accordance with ethical principles, the Code of Conduct and compliant with relevant legislation

8.6: Establish and manage client accounts

► The need for a client account is identified.

► Records are maintained and audited as required.

► Books are balanced as required by statutory authorities.

► All incoming monies are lodged as appropriate.

Standard 9 – Manage a practice in accordance with ethical principles, the Code of Conduct and compliant with relevant legislation

9.1: Manage finances

► Operating accounts are established and maintained.

► Finances are managed and monitored on an ongoing basis.

► Invoices are prepared, issued and followed up as various matters are completed.

► Journals are kept up to date as required.

9.2: Manage employees

► All staff are trained and educated about Code of Conduct.

► Staff are supervised and performance managed as required.


2. What is client money? 2.1 Definitions

2.2 Requirements

2.3 How is client money different from operating money?

2 WHAT IS CLIENT MONEY?2.1 Definitions Client A client is an individual, firm, legal entity or organisation to whom or to

which immigration assistance or advice is provided by a registered migra-tion agent.

Clients’ Account A Clients’ Account is a bank account used by RMAs with for monies held on behalf of clients.

Operating Account An Operating Account is a bank account used by RMAs to facilitate their business operations by depositing income earned and paying business expenses.

2.2 RequirementsUnder Part 7 of the Code of Conduct, you have specific responsibilities in relation to bank accounts and the handling of monies held on behalf of clients. You must keep separate bank accounts for:• Youroperatingexpenses(yourOperatingAccount)• Moneypaidbyclientstoyouforfeesanddisbursements(yourClients’Account)

2.2.1 Keep Proper Records

It is important to keep proper records for your Clients’ Account, including:• date/amountofeachdeposit,purposeofdepositandclient’sname;• thedateandamountofeachwithdrawalandtowhichclientitrelates;• receiptsforanypaymentsmadebytheclient;and• copiesofinvoicespaid.

This might be achieved by maintaining an individual client money ledger or generic Clients’ Account money ledger depending on the business model you have adopted.

The ledgers may be used to evidence your compliance with the Code of Conduct.

Handy Tip:

Ensure you retain primary records such as bank statements, invoices, chequebooks, and receipts that form the basis for ledger entries


2.3 How is client money different from operating money?

Client money Operating money

Definition

Client money is:

► any money (in whatever form) coming into your or your staff’s control which is the property of a client to which you or your staff have no current entitlement.

► any money you receive from a client before you have provided them with a Statement of Services or an invoice.

► any money paid by a client to you for fees and disbursements, for example visa application fees.

► any refunds you receive on behalf of a client for example, refunds of Tribunal application fees.

Operating money is:

► used for running your business, depositing income earned and paying business expenses.

► any money that you are legally entitled to after completing services you agreed to provide and after issuing a client with an invoice or Statement of Services.

► any money you invest into your own business.

Purpose

To make application related payments or disbursements such as:

► visa application charges

► penal clearance fees

► enrolment fees

► clients’ health clearance checks

To pay for expenses related to running your migration agent practice such as:

► rent, electricity, postage, travel, wages, bank fees, telephone, internet, advertising, stationery, subscriptions, insurance etc.

Controls

Client money must remain deposited in a Clients’ Account until

► an invoice or Statement of Services has been issued to a client for an agreed block work performed

► you pay for disbursements to a third party/supplier on your client’s behalf.

Operating money can be accessed by you in accordance with your own business practices.

Keep proper records of transactions in your Clients’ Accounts and your Operating Accounts.


The Code of Conduct says ….. Part 7 Financial Duties under clause 7.1 of the Code of Conduct states that:

”Subject to clause 7.1B, a registered migration agent must keep separate accounts with a financial institution for: The agent’s operating expenses (the operating account); and Money paid by clients to the agent for fees and disbursements (the clients’ account).”

2.3.1 Characteristics of a Clients’ Account

A Clients’ Account has the following characteristics:

► only used to deposit payments made by clients before agreed work has been completed;

► used to make disbursements on behalf of clients where the client has provided a prepayment for that purpose;

► should not accrue interest; and

► bank fees and charges are not applied to your Clients’ Account. Fees and charges that apply to maintaining a Clients’ Account should be billed to your Operating Account. This can be arranged with your financial institution.

Common mistakes

► RMAs find it difficult to differentiate between client monies and operating monies due to different operating models they adopt;

► RMAs mix up client monies with operating expenses; and

► RMAs transfer funds from their Clients’ Account to the Operating Account before work is completed or without providing an invoice or the Statement of Services

The Code of Conduct says …..

Part 7 Financial Duties under Clause 7.1 of the Code of Conduct states that::

”Subject to clause 7.1B, a registered migration agent must

keep separate accounts with a financial institution for:

The agent’s operating expenses (the operating account); and

Money paid by clients to the agent for fees and disbursements

(the clients’ account).”


3. Setting up the right clients’ account 3.1 How do I set up a clients’ account?

3.2 How do I deal with client monies?

3.3 How do I reference transactions on my clients’ account?

3 Setting up the right Clients’ Account3.1 How do I set up a Clients’ Account?

To set up your Clients’ Account, you will need to:

► contact your financial institution such as a bank or a credit union about establishing two separate accounts with them (these will be your Clients’ Account and your Operating Account);

► ask your financial institution to open up an account in your business name and then ask them to include, in either the account name or the description, the words “Clients’ Account”;

► ensure the words “Clients’ Account” are printed on your bank statements; and

► check that the Clients’ Account has a separate account number to the Operating Account.

Handy Tips

► You may wish to explain to your financial institution that your Clients’ Account should not earn interest and request that any bank fees are charged to your “Operating Account”. You might also request that your Clients’ Account does attract any account keeping fees.

► If fees are charged on your Clients’ Account, request your financial institution should debit these fees from your Operating Account.

► If interest is earned on a Clients’ Account then it must be apportioned to clients in proportion to the balance of their monies in the Clients’ Account.

► If account keeping fees are charged on a Clients’ Account these must be reimbursed into the account each month.

► To ensure clear separation between your accounts, you may wish include the words “Operating Account” within the account name of your Operating Account.

► You may wish to take a copy of the Code of Conduct to your financial institution to assist their understanding of your requirements.


3.2 How do I deal with client monies?When you receive client monies you must:

► issue a receipt to the client acknowledging the funds;

► deposit the funds into your Clients’ Account;

► record the deposit in the client money ledger or computerised accounting system used for financial administration; and

► not withdraw client monies as payment for your services or for disbursements until an invoice has been issued to the client.

A separate Clients’ Account ensures that client monies such as prepayments of visa application charges, police checks, health checks, translation services and professional fees are held by you untilsuch services have been performed.

3.2.1 Making and recording deposits and withdrawals

Deposits

Client money can be deposited in the following forms:

► cash payments► credit card payments► cheque payments/money orders► direct transfers► Western union transfers or other similar service

Withdrawals

The following withdrawals can be made from your Clients’ Account:

► disbursements;

► re-imbursement of disbursements paid through your credit card (refer chapter 5 – providing tax invoices and receipts); and

► transferring professional fees after issuing an invoice or Statement of Services, once an agreed block of work is completed.

The Code of Conduct says …..Clause 7.1 of the Code of Conduct sets out the requirement for RMAs to maintain two separate accounts with a financial institution:

► one for client monies which is the Clients’ Account, and

► one for the RMA’s operating expenses which is the Operating Account.


3.3 How do I reference transactions on my clients’ account?

All transactions on your Clients’ Account must be recorded and referenced as noted below:

► references must state the name of the client and the purpose of the transaction; and

► references must correlate to the recording entries made in your client ledger or computerised accounting system to establish a clear audit trail for the flow of funds. It is advisable to include receipt and invoice numbers.

Common mistakes:

► RMAs fail to open a Clients’ Account;

► RMAs mix up client monies with operating expenses;

► RMAs fail to include references for transactions from the Clients’ Account, making it difficult to identify what the transaction relates to;

► RMAs transfer funds from the Clients’ Account to the Operating Account without providing an invoice or Statement of Services; and

► RMAs experience difficulty in obtaining cooperation of their financial institutions in setting up the right account.

The Code of Conduct says …..Clause 7.1A specifies that the words ‘clients’ account’ must be included in the name of the financial institution account.

When RMAs receive client money in advance, Clause 7.2 of the Code specifies that these monies are to remain in the Clients’ Account until the client has been provided an invoice for work performed.


4. Providing clients with a fee estimate 4.1 What is a fee estimate?

4.2 How do I prepare a fee estimate?

4.3 What must be included on a fee estimate?

4 Providing clients with a Fee Estimate4.1 What is a Fee Estimate?A Fee Estimate helps clients gain an understanding of all the costs associated with preparing and lodging their visa application. The Fee Estimate must be provided prior to starting work or receiving written instructions to start work.

A Fee Estimate should be formalised in a written Agreement for Services and Fees. An Agreement for Services and Fees is required by clause 5.2 (c) of the Code of Conduct. You should not start work until the Agreement for Services and Fees has been signed by your client.

Why should a Fee Estimate be provided?

A Fee Estimate once provided to your client:

► provides clients with a clear expectation of the likely costs to be incurred in lodging a visa application (including the visa application charge and all other fees required to be paid);

► reduces the likelihood of disputes over fees and charges;

► helps you enforce receiving payment from clients, if clients have given written acceptance of the Fee Estimate; and

► helps you comply with the Code.

A Fee Estimate has the following characteristics:

► it is similar to a quote to provide services;

► it is provided prior your commencement of any work;

► should be formalised as a written Agreement for Services and Fees signed by the client prior to your commencement of any work;

► it includes essential terms regarding fees and services to be provided; and

► it is different from a Statement of Services performed because it lists services to be performed rather than the services already performed.

Handy TipThe Code of Conduct does not specify the scale of fees you can charge clients. There are a number of factors that influence the fees charged by RMAs. These include your experience, complexities of a particular case, the business running costs (this is usually related to the size of the business) and the level of service the client requires to assist them with their case.


4.2 How do I prepare a Fee Estimate?Providing a Fee Estimate involves the following steps:

1. Calculating the relevant fees you will charge the client for each service or for each hour of work, that is either:

► a fee for each service where a fixed amount is charged per agreed block of work; or

► an hourly rate for your services.

2. Estimating all the likely disbursements and sundry expenses to be incurred by the client including the visa application charge and all other fees required to be paid.

3. Estimating the time likely to be taken in performing the services.

4. Determining the essential terms of the services to be provided including the timing and method of payment for fees and charges by third parties.

5. Presenting this information with the total amount likely to be charged in a document titled – ‘Fee Estimate’.


Clause 2.20(c) states that a RMA must: “if the agent is to pay an amount for the client – give the client written advice of the date by which the amount must be given to the agent so that the interests of the client are not prejudiced;”

Clause 5.2(a) states that a RMA must “before starting work for a client, give the client:

(i) an estimate of charges in the form of fees for each hour or each service to be performed, and disbursements that the agent is likely to incur as part of the services to be performed; and

(ii) an estimate of the time likely to be taken in performing the services;”

Clause 5.4 states that: “A registered migration agent must give clients written advice of the method of payment of fees and charges, including Departmental fees and charges.”

Handy Tip:Payment due dates may not be determined at the time the Fee Estimate is issued or the Agreement for Services and Fees is signed, however, both should reference that written advice of the date/s will be provided in advance. Consider discussing how much advance notice your clients may require.


4.3 What must be included on a fee estimate?

4.3.1 Necessary components of a Fee Estimate

A Fee Estimate MUST:

► list the professional fees you will charge for preparing and/or lodging an application and describe the services in sufficient detail so that your client understands what services they are receiving and will be provided;

► state the time likely to be taken in performing the services;

► list all the disbursements you expect your client to incur and the method of payment you require. If you require prepayment, you will need to advise your client when the payments are required;

► explicitly state which fees and services are subject to GST;

► list sundry expenses such as: couriers, postage, telephone calls you have incurred on behalf of your client;

► state your payment terms for fees and charges, for example: 50% in advance - 50% on lodgement of the application, milestone payments for agreed blocks of work etc;

► state acceptable payment methods for example: EFTPOS, Credit Cards, Direct Deposit, Cash and Cheques;

► clearly state whether there are additional ‘success fees’ associated with the application;

► clearly state whether there is a ‘no win no fee’ term; and

► include a clause that requires written acceptance from your clients before you commence work. (Most agents achieve this through a signed “Agreement for Services and Fees”.)

An example Fee Estimate is provided at 4.3.2 of this section.

Common mistakes:

► RMAs fail to issue a Fee Estimate as they are perceived as ‘low value’;

► estimates and agreements on fees and services are made orally;

► estimates make no reference to the terms of payment;

► verbal Fee Estimates cause disputes over payments required for a particular service;

► verbal Fee Estimates leave RMAs with little rights to enforce payment from clients;

► RMAs fail to utilize appropriate templates for Fee Estimates;

► RMAs do not have good templates for Fee Estimates; and

► RMAs do not understand the implications of offering a ‘no win, no fee’ service.


4.3.2 Example Fee Estimate

Fee EstimateABN:

To: Date:Our Reference:

[Street Address] RMA Name:[City STATE Postcode] MARN:[COUNTRY]

Item No. Price GST Total

(a)

(b)

(c)

(d)

(e)

(f)

(g)

2

3

4

5

6

7

8

9

10

Terms1

2

3456

Prepare your visa application ([VISA TYPE] and any required supporting submissions

Where additional fees may apply, you w ill be notif ied in w riting prior to incurring the charge.

Disbursements w ill need to be paid in advance or by the client directly. We w ill advise you in w riting 14 days before the payment is required. If w e pay the disbursement on your behalf w e w ill issue you w ith the supplier's receipt.We accept: credit cards, EFTPOS, direct deposits, cheques and cashOur fees are non-refundable even if the visa outcome is unfavourable.

Sundry ExpensesPostage and courier costs

Phone calls

Photocopying, Scanning, Fax costs, Stationery

[YOUR FOOTER HERE]

Fee for Services

Service Description

1

Police check

English Language Test (IELTS) - [client to pay directly to IELTS]

Skills Assessment - CPA Australia

Note: If your visa is not granted then w e w ill discuss your review rights and associated costs.

Submit your visa application

[Company Name]

[Your Company Name]

[Client Name]

Professional Fees

Visa application charge

Medical examination

Translations of documents [client to pay directly to translator]

Liaise w ith DIAC during the processing time of your visa application until a decision on your visa is made w hich may include providing further documentation or information

Provide advice regarding visa conditions and requirements

Disbursements

Perform a Visa Eligibility Assessment

Assist and guide you ghrough the application process including required documentation

Prepare your submission for your occupation and skill assessment

Total Estimate

This document is not a Tax Invoice. It is an estimate only. Actual fees and the total amount may vary.

Our payment terms are 50% of the professional fees in advance and the balance on lodgement of your application. Payment for sundry expenses w ill be required w hen your application is lodged.

There are no additonal success fees associated w ith a favourable visa application decision.


4.3.3 Success fee

A ‘success fee’ is an additional fee charged to clients for a successful outcome on a visa application.

4.3.4 ‘No win, no fee’

You must understand the financial implications of offering a ‘no win, no fee’ service to your clients. Under such an agreement, if a visa application is unsuccessful, you agree to refund your professional fees to your client. Clause 7.6 of the Code of Conduct lists your obligations should you have a ‘no win no fee’ policy.

When including such a term on a Fee Estimate, you must:

► clearly state which fees will be refunded to your client;

► state how the refund will be processed to your client;

► provide a time frame for the refund to be processed and received by your client; and

► inform clients that advance payments made by them would be deposited in a Clients’ Account until a positive visa decision is made;

You are required to disclose whether you offer a ‘no win, no fee’ option to clients as part of your repeat registration application process. You will be required to disclose if you have clients subject to a ‘no win no fee’ policy and demonstrate that you have sufficient funds available to cover any amount that you may become liable to pay.


Clause 7.6 states:

If a registered migration agent provides a service to a client on the basis of a conditional refund policy, a ‘no win, no fee’ policy or an undertaking to similar effect:

a) The agent must have sufficient funds available to cover any amount that the agent may become liable to pay to the client under the policy or undertaking; and

b) The agent must meet that obligation by:

i) Keeping funds in the Clients’ Account; or

ii) Keeping a security bond; or

iii) Maintaining adequate insurance

Handy Tip:Ensure you have sufficient funds to meet your ‘no win no fee’ obligations and that the funds are held in an appropriate manner as set out in clause 7.6(b) of the Code of Conduct.


4.3.5 Agreements for Services and Fees

Where a client is satisfied with the Fee Estimate and instructs you to proceed, you should confirm their instructions in writing through a signed Agreement for Services and Fees.

An Agreement for Services and Fees sets out services to be performed, associated fees and disbursements for which payment must be made.

Prior to commencing any work, you are required to ensure that your client has read and acknowledged the terms of the professional services by ensuring they sign and date the Agreement for Services and Fees document.

In instances where more than one RMA works on a client’s case, the Agreement for Services and Fees should clearly set out the details of the RMA who has primary carriage and responsibility for the case.

Details of other RMAs who have some level of involvement in their case should also be disclosed to the client as part of the agreement. In addition to disclosure, proper records must be maintained, documenting the activity that occurs on a client’s case at any particular point in time.

Handy Tip:Consider incorporating a Fee Estimate process within an Agreement for Services and Fees.


Clause 5.2 (c) states a registered migration agent must:

c) give the client written confirmation (an Agreement for Services and Fees) of:

i) the services to be performed; and

ii) the fees for the services; and

iii) the disbursements that the agent is likely to incur as part of the services.


4.3.6 Termination of services

An Agreement for Services and Fees must set out the terms for returning of monies paid where either you or your client terminates the agreement. You are only entitled to keep fees for work you have completed or disbursements you have made and for which a Statement of Services (refer Chapter 7 – Statement of Services) has been provided to the client (section 313(1) of the Act).

As an RMA, you must:

► inform clients that advance payments made by them will be deposited in a Clients’ Account until services have been performed;

► clearly state how the calculation of work completed will occur;

► how the refund will be processed to the client;

► the timeframe for the refund to be processed and received by the client (this must be within 7 days - see clause 10.1B of the Code of Conduct); and

► issue a final account (Statement of Services) to the client detailing all of the work performed up to the date of termination.

Note: The Authority has dealt with matters where a client has paid an RMA for their services upfront, has become dissatisfied with the services and decided to terminate the agreement and requested a refund. In these circumstances, whilst an RMA is entitled to retain fees for services completed up to the date of termination, an RMA must still render a final account to the client, detailing all of the work performed. Without this the RMA will not be entitled to payment for any work done.

Handy Tip:

► Consider incorporating a Fee Estimate process within an Agreement for Services and Fees.

► Prepare a comprehensive ‘master list’ of all the fees and charges associated with applications and refer to this master list when preparing a Fee Estimate for clients.

► Do not commence work until you have obtained written acceptance to the terms and fees from the client in the form of the Agreement for Services and Fees.

► Ensure you provide your client with written notice of any material change to the estimated cost of providing a service, and the total likely cost because of the change, as soon as you become aware of the likelihood of a change occurring.


4.3.7 Change to estimated costs

As a matter of best practice, variations to the services to be provided or the fees charged (both professional and disbursements) to your client should be recorded as a variation to the Agreement for Services and Fees and accepted by your client (by dating and signing the relevant variation agreement) before any additional services are commenced and fees incurred. This will assist in minimising fee disputes between you and your clients. Additional costs to the client should not be incurred before the client has agreed to the increased cost.

In accordance with Clause 5.2(d) of the Code you must give the client written notice of any material change to the estimated costs of providing a service, and the total likely cost because of the change as soon as the agent becomes aware of the likelihood of a change occurring. For example, changes in the visa application charge, or the cost of a skills assessment or if a case is particularly complex and the professional fees are not fixed, and there are likely to be additional professional fees incurred by the client, associated with researching, preparing and lodging an application.


Clause 5.2 (d) states a registered migration agent must:

“give the client written notice of any material change to the estimated cost of providing a service, and the total likely cost because of the change, as soon as the agent becomes aware of the likelihood of a change occurring.”


5. Tax invoices and receipts 5.1 Tax invoices

5.2 Receipts

5 Tax Invoices and receipts5.1 Tax invoicesA tax invoice is issued by you to your client. The tax invoice represents the amount payable to you for services you have performed for and on behalf of your client.

5.1.1 When should a tax invoice be provided?

A tax invoice should be provided to clients when:

► services as per the Agreement for Services and Fees have been performed;

► an agreed block of work as per the Agreement for Services and Fees has been performed; and

► you are to be reimbursed for processing a disbursement on behalf of your client where you have used operating money or your business credit card (refer Chapter 6 – Processing Disbursements for further information).

5.1.2 What terms should be included on tax Invoices?

The following essential terms must be included on tax invoices:

► The document is intended as a tax invoice

► The invoice number

► Your Name and MARN

► Your Business Name and ABN

► The date the tax invoice was issued

► The client/visa applicant’s identity

► Description of the services rendered, including the cost of services rendered (per hour lump sum)

► Description of any disbursements

► The GST amount (if any) payable in relation to the services performed

5.1.3 Differences between an invoice and a receipt issued by an RMA

Invoice Receipt

► provided to a client after services have been performed

► represents amounts payable to the RMA for services performed

► states services that have been performed and how much they cost

► provided to a client when payment is received from them


5.1.4 Example Tax Invoice

Tax InvoiceABN: Date:

To: Our Reference:RMA Name:

[Street Address] MARN:[City STATE Postcode][COUNTRY] Invoice No.


1 $3,000.00 $300.00 $3,300.00

2 $100.00 $10.00 $110.00

3 $20.00 $2.00 $22.00

4 $20.00 $2.00 $22.00

$3,454.00

$3,454.00

$0.00

[YOUR FOOTER HERE]

Payment Terms: Within 14 days of issue of this invoice

Fee for Services

Postage and courier costs

Phone calls


Total amount payable

Total amount received to date (Receipt No. 9876)

Total balance amount due

Service Description

Reference: Invoice for Professional Services and Disbursements

[Your Company Name]

[Client Name][Company Name]

YOUR LOGOHERE

5.1.5 Recording invoices

When an invoice is issued, you must make a record in the client money ledger or computerised accounting system. Details such as the name of the client, the purpose, the invoice number, the amount and the date of the invoice must be entered in the ledger.

Handy Tip

An invoice legally entitles the RMA to withdraw professional fees from the Clients’ Account as payment for their services.


5.1.6 Goods and Services Tax

The requirements for issuing tax invoices and receipts for each category of RMA have been listed below. RMAs generally fall into the following categories with regards to GST.

TYPE OF RMA INVOICE & GST RECEIPT & GST

Required to register for GST and registeredTax Invoice

ReceiptFees Disbursements Sundry expenses

The RMA issues tax invoices and receipts as they are registered for GST and are making taxable sales

Include GST in professional fees or charge GST on professional fees

Include the total amount of the disbursement

Include the total amount of the sundry expenses incurred

Issue a receipt which states the GST collected from the customer

Required to register for GST and not registeredTax Invoice


The RMA issues tax invoice and receipts as they are not registered for GST but are required to be registered and are making taxable sales





Not required to register for GST and registeredTax Invoice


The RMA issues a tax invoice and tax receipts as they are registered for GST and are making taxable sales





Not required to register for GST and not registeredThis category also applies to overseas RMAs

InvoiceReceipt

Fees Disbursements Sundry expenses

The RMA issues invoices and receipts as they are not registered for GST and are not making taxable sales

Do not include GST in your professional fees and do not charge GST on top of your professional fees



Issue a receipt which states only states the total amount collected from the customer

*Ensure your tax information is up-to-date. Refer to the ATO website which contains current information about your tax obligations or consult with your accountant.


5.1.7 Summary – Choosing to have your client pay up front for Services

INITIAL CONSULTATION

1. RMA gives client fee estimate before commencing any work

2. RMA receives client instructions to commence work

3. Payment terms agreed – upfront and for agreed blocks of work

WRITTEN CONTRACT

1. RMA enters in a written contract (Agreement for Services and Fees)

2. Client accepts terms of Agreement in writing

PROFESSIONAL FEES

Funds transferred from clients’ account to operating account when:

• Invoice for block of work performed issued to client

• A statement of services issued within 28 days of final decision

COMMENCE WORK

1. RMA performs work

2. Work is performed and completed for first agreed block of work

RECEIVE CLIENT MONEY

1. RMA receives full payment of services from client

2. RMA issues a receipt to client

3. Monies received belong to client and are deposited into RMA’s clients’ account

DISBURSEMENTS

1. Third party disbursement is processed from client’s advanced payment

2. RMA issues receipt from third party to client

I think I want my client to pay up front

for my services


5.1.8 Summary – Choosing to have your client pay after completion of Services

INITIAL CONSULTATION

1. RMA gives client fee estimate before commencing any work

2. RMA receives client instructions to commence work

3. Payment terms agreed on for agreed blocks of work or agreedhourly rate.

WRITTEN CONTRACT

1. RMA enters in a written contract (Agreement for Services and Fees)

2. Client accepts terms of Agreement in writing

PROFESSIONAL FEES

• Invoice for block of work performed issued to client

• A statement of services issued within 28 days of final decision

COMMENCE WORK

1. RMA performs work

2. Work is performed and completed for first agreed block of work

DISBURSEMENTS

RMA issues invoice to client with receipt from third party attached.

I don’t want to charge my clients in

advance

OPERATING ACCOUNT

1. Money received from client can be deposited directly into RMA’s operating account.

2. RMA issues receipt for payment.

REMEMBER to keep appropriate records of all transactions.


5.2 ReceiptsA receipt is issued by you to your client. The receipt is a document acknowledging the amount paid by a client to you and may represent:

► payment for services already provided for and on behalf of your client; or

► advance payment for services to be provided for and on behalf of your client.

5.2.1 When should a receipt be provided?

A receipt should be provided to clients when:

► they make a payment to you; or

► a disbursement is processed from your Clients’ Account (refer Chapter 6 – Processing Disbursements for further information on processing disbursements).

5.2.2 What terms should be included on receipt?

1. The receipt number

2. Your name and Migration Agent Registration Number (MARN)

3. Your Business Name and Australian Business number (ABN) where applicable

4. The date the receipt was issued

5. The client/visa applicant’s identity

6. Description of the services rendered, including the price of services rendered (per hour/ lump sum)

7. The total amount paid

8. The GST amount

9. The total amount outstanding

10. The total amount paid by the client for services performed

Common Mistakes

► RMAs cannot differentiate between receipts and invoices;

► RMAs cannot differentiate receipts, tax invoices and GST;

► RMAs do not have appropriate templates for receipts and invoices; and

► RMAs do not include all essential terms of payment on their


5.2.3 Example Receipt format

[Your Company Name] Date:ABN: Our Reference:

RMA Name:To: [Client Name] MARN:

[Company Name][Street Address] Receipt No.[City STATE Postcode][COUNTRY]

Item Number Service Description Price GST Total

1 $3,000.00 $300.00 $3,300.00

$3,300.00$3,300.00

Nil

[YOUR FOOTER HERE]

Total amount outstanding

Thank you for your payment

RECEIPT

Advanced payment of 50% of total fees as specified in the Agreement for Services and Fees signed on 19 October 2012.

Total amount payableTotal amount received

YOUR LOGOHERE

5.2.4 Recording receipts

When money is received from a client, you must make a record in the client ledger or computerised accounting system. Details such as the name of the client, the purpose, the receipt number, the amount and the date of receiving the payment must be entered in the ledger.

5.2.5 How does GST apply to a receipt?

Goods and services tax (GST) requirements are illustrated in section 5.1.6 of this toolkit.

Handy TipA receipt provided to the client reduces the likelihood of RMAs being accused of receiving money clients have not paid.


6. Processing disbursements 6.1 Common methods for processing disbursements

6.2 Recording disbursements

6 Processing Disbursements6.1 Common methods for processing disbursementsIn the course of your work as a registered migration agent, your clients may be required to provide supporting documentation which attract associated costs. Such documents may include, but are not limited to, police clearances, medical examinations and skills assessments. Payments made by an RMA on behalf of his/her client for lodgement and/or processing of such documents are referred to as ‘disbursements’.

There are generally four ways to process disbursements:

1. You pay for the disbursement and then seek reimbursement from your Clients’ Account. In this scenario you would process disbursements as follows:

► Use your business credit card or Operating Account to pay for the disbursement.

► Receive a receipt for processing the disbursement (from third party/supplier).

► Issue your client with an invoice for the disbursement with the supplier receipt attached.

► Withdraw client monies from the Client Account to reimburse your credit card or Operating Account.

► Issue your client with a receipt for the payment.

► Record the transaction in your client ledger.

2. You use your Clients’ Account directly to pay the disbursement. In this scenario you would process disbursements as follows:

► Pay the disbursement directly from the Clients’ Account.


► Issue your client with a receipt for processing the disbursement with the supplier receipt attached.


Clause 2.20(d) of the Code of Conduct requires that the agent “give the client a written notice of each amount paid by the agent for the client.”

Handy Tip:

REMEMBER to include all anticipated disbursements in the Agreement for Services and Fees.


3. You pay for the disbursements and then seek payment from your client. In this scenario you would process disbursements as follows:

► Use your business credit card or Operating Account to pay for the disbursement.


► Issue your client with an invoice for the disbursement with the supplier receipt attached.

► Receive payment from the client.

► Issue your client with a receipt for the payment.


4. The client pays the disbursement directly. In this scenario no further action is required. However, it is good practice to obtain evidence of the payment and record this on the client file.

6.1.1 Example of a Tax Invoice for a disbursement where the client has already paid the money in advance

Tax InvoiceABN:

Date:To: Our Reference:

RMA Name:[Street Address] MARN:[City STATE Postcode][COUNTRY] Invoice No.


5 $2,600.00 N/A $2,600.00

$2,600.00$2,600.00

$0.00Total balance amount due

No payment required.

[YOUR FOOTER HERE]

Reference: Invoice for Professional Services and Disbursements

[Your Company Name]

Total amount payable Total amount received to date (Receipt No. 9877)

Service DescriptionDisbursementsVisa application charge paid on 19 October 2012

[Client Name][Company Name]

YOUR LOGOHERE


6.2 Recording disbursementsWhen recording disbursements you must:

► record the payment in the client ledger and reference the client name on the Clients’ Account;

► reference the transaction on the credit card or Operating Account if using operating monies and also make a record in the client money ledger;

► record the date when the tax invoice and/or receipt from a third party is provided to the client;

► record the date of the invoice; and

► ensure the invoice and a copy of the receipt are kept on the client file.


7. Statement of Services 7.1 When should a Statement of Services be provided?

7.2 What should be included on a Statement of Services

7 Statement of Services7.1 What is a Statement of Services?A Statement of Services provides your client with an itemised account of the services performed, the associated fees for those services and relevant disbursements.

The requirement for providing a Statement of Services is set out in section 313 of the Migration Act 1958 and Clause 5.5(b) of the Code of Conduct.

A Statement of Service must set out:

1. Particulars of each service performed; and

2. The charge made in respect of each such service

It is provided after the provision of services and, therefore, includes work already performed rather than ‘to be performed’.

It is good business practice to issue a final account of fees and charges incurred during the term of an Agreement for Services and Fees with your client.

7.2 When should a Statement of Services be provided?A Statement of Services should be provided to clients when all agreed work in the Agreement for Services and Fees has been performed.

Note: The Statement of Services may be an itemised invoice or account.


Clause 5.5(c) of the Code of Conduct states:

“a client is entitled by the Act to recover the amount of a payment as a debt due to him or her if he or she:

(i) made the payment to the agent for giving immigration assistance; and

(ii) did not receive a statement of services before making the payment; and

(iii) does not receive a statement of services within 28 day after a final decision is made about the visa application, cancellation review application, nomination or sponsorship to which the immigration assistance related.”


7.3 What should be included on a statement of services?

The following essential terms must be included on a Statement of Services:

1. Identify the document as a Statement of Services

2. Your name and MARN

3. Your business name and ABN (if applicable)

4. The date the Statement of Services was issued

5. The client/visa applicant’s identity

6. Description of the services rendered, including the price of services rendered ( per hour/ lump

sum)

7. Description of any disbursements

8. The GST amount (if any) payable in relation to the services performed.

Handy Tip:The most practical effect of clause 5.5 of the Code of Conduct is that you provide a final account to your client, setting out:

► All the services performed;

► The fees for the services; and

► The disbursements paid.


7.3.1 Example of a Statement of Services format

Statement of ServicesABN:

To: [Client Name] Date:[Company Name] Our Reference:[Street Address] RMA Name:[City STATE Postcode] MARN:[COUNTRY]


(a) $250.00 $25.00 $275.00

(b) $250.00 $25.00 $275.00

(c) $500.00 $50.00 $550.00

(d) $1,000.00 $100.00 $1,100.00

(e) $250.00 $25.00 $275.00

(f) $250.00 $25.00 $275.00

(g) $3,500.00 $350.00 $3,850.00

Sub-Total $6,000.00 $600.00 $6,600.00

2 17-Dec-11 $35.00 NA $35.00

3 18-Dec-11 $365.00 NA $365.00

4 28-Dec-11 $2,600.00 NA $2,600.00

5 23-Dec-11 $230.00 NA $230.00

Sub-Total $3,230.00 $3,230.00

8 13 Nov 2011 to 2 Apr 2012

$35.00 $3.50 $38.50

9 13 Nov 2011 to 2 Apr 2012

$20.00 NA $20.00

10 13 Nov 2011 to 2 Apr 2012

$34.00 NA $34.00

Sub-Total $89.00 $3.50 $92.50

$9,922.50

$9,692.50

$230.00

-$9,922.50

$0.00

[YOUR FOOTER DETAILS HERE]

13 Nov 2011 to 2 Apr 2012

Total value of all invoices issued (invoice numbers 1020 and 2010)

Total value of supplier recipts issued (medical examination)

Total value of all payments made (receipt numbers 9876 and 1012)

Balance

Total value of all services performed to date

This document is not a Tax Invoice. It is statement only. Invoices have been issued to you separately.

Sundry Expenses

Postage and courier costs

Phone calls


Visa application charge

Medical examination

DisbursementsPolice check

Skills Assessment - CPA Australia

Professional Fees

1

Fee for Services

Perform a Visa Eligibility Assessment

Assist and guide you ghrough the application process including required documentationPrepare your submission for your occupation and skill assessmentPrepare your visa application ([VISA TYPE] and any required supporting submissions

Provide advice regarding visa conditions and requirements

Service Description

[Your Company Name]

Submit your visa application

Liaise w ith DIAC during the processing time of your visa application until a decision on your visa is made w hich may include providing further documentation or information

Note: The Statement of Services may be an itemised invoice or account.


7.3.2 Differences between a Fee Estimate, an Invoice and a Statement of Services

Fee Estimate InvoiceStatement of services

performed

► is provided before commencing work

► must be provided before accepting client money

► lists services to be provided and associated fees

► does not have GST implications, but helps clients understand GST implications

► is usually formalised as an agreement in writing in the Agreement for Services and Fees

► is provided to a client after services have been performed

► represents amounts payable to the RMA

► entitles the RMA to withdraw professional fees from the Clients’ Account

► has GST implications

► is provided to a client after services have been performed

► is a summary of the services performed in accordance with agreed terms in the Agreement for Services and Fees

► does not have any GST implications

Legislative Framework

Clause 5.2 of the Code of Conduct



Section 313 of the Migration Act 1958



8. Accounts and Records Management 8.1 Accounts and records management practices

8.2 What is a client money ledger?

8.3 How do I maintain a client money ledger?

8.4 What is an operating money ledger?

8.5 How to maintain an operating money ledger

8 Accounts and Records Management8.1 Accounts and records management practicesGood accounts and records management practices will help you to:

► verify that all bank transactions have been captured in the client money ledger;

► verify all bank transactions have been documented for management audit trail purposes;

► help ascertain any variances between client money received and client money spent;

► track all expenses, disbursements and charges made in respect of each individual client; and

► determine residual funds owed to clients at the end of an engagement or, conversely additional funds owed by clients to cover application costs.

8.2 What is a client money ledger?A client money ledger documents the inflow and outflow of client money from the Clients’ Account held at the bank. This ledger may be maintained in paper form such as record keeping books or through a computerised accounting system.

Clause 6.1 of the Code of Conduct states: “A registered migration agent must maintain proper records that can be made available for inspection on request by the Authority,”


Clause 6.1 of the Code of Conduct specifies that RMAs must maintain proper records that can be made available to the Authority and include files containing:one for client monies which is the Clients’ Account, and

► A copy of each client’s application

► Copies of each written communication between the client and the agent;

► Copies of each written communication between the agent and any relevant statutory authority;

► Copies of each written communication between the agent and the Department regarding the client;

► File notes of every substantive or material oral communication between the client and the agent;

► File notes of every substantive or material oral communication between the agent any an official of any relevant statutory authority; and

► File notes of every substantive or material oral communication between the agent and the Department regarding the client


8.3 How do I maintain a client money ledger?A client money ledger must be maintained on a timely basis. The timeliness of updating the client money ledger may be determined by the size and frequency of the transactions you process. Some essential tips on maintaining a client money ledger are:

► enter cash and bank transactions at least on a weekly basis;

► document the date, amount, purpose and name of client on each transaction;

► document the name of the recipient of any withdrawals from the account and if an invoice has been issued the invoice number or if a receipt was issued by a supplier the receipt number;

► ensure details entered on the ledger are consistent with those on the Clients’ Account to establish a management audit trail;

► perform a reconciliation of transactions in the ledger to the Clients’ Account on a monthly basis; and

► document any variances or discrepancies.

8.4 What is an operating money ledger?An operating money ledger documents the inflow and outflow of operating money from the Operating Account. This ledger may be maintained in paper form such as record keeping books or through a computerised accounting system.

8.5 How to maintain an operating money ledger?An operating money ledger must be maintained on a timely basis, this timeliness of updating the client money ledger may be determined by the size and frequency of the transactions you process. Some essential tips on maintaining a client money ledger are:

► enter cash and bank transactions at least on a weekly basis;

► document the date, amount, purpose and name of client on each transaction and the amount, date and purpose of all operating and other expenses;

► document the name of the recipient of any withdrawals from the account;

► ensure details entered on the ledger are consistent with those on the Operating Account to establish an audit trail;

► perform a reconciliation of transactions in the ledger to the Operating Account at least on a monthly basis; and

► document any variances of discrepancies.

By way of illustration, examples of typical Clients’ Account Bank Statements, Operating Account Bank Statements and Clients’ Account Ledger are provided at 8.5.1, 8.5.2 and 8.5.3 respectively.


8.5.1 An Example Clients’ Account Bank Statement

$35,000.00

CR DR17/10/2012 Receipt advance payment - Mr John

Smith 123789 $5,798.00 $40,798.00

18/10/2012 Disbursement - AFP police check (AFP) - Mr John Smith

123791 $38.00 $40,760.00

19/10/2012 Disbursement - Medical examination (Dr XYZ) - Mr John Smith

123793 $260.00 $40,500.00

20/10/2012 Disbursement - Visa application fee (DIAC) - Mr John Smith

123795 $2,200.00 $38,300.00

21/10/2012 Transfer to Operating account - John Smith professional fees

123797 $3,300.00 $35,000.00

22/10/2012 $35,000.0023/10/2012 $35,000.0024/10/2012 $35,000.0025/10/2012 $35,000.0026/10/2012 $35,000.0027/10/2012 $35,000.0028/10/2012 $35,000.0029/10/2012 $35,000.0030/10/2012 $35,000.0031/10/2012 $35,000.001/11/2012 $35,000.002/11/2012 $35,000.003/11/2012 $35,000.004/11/2012 $35,000.005/11/2012 $35,000.006/11/2012 $35,000.007/11/2012 $35,000.008/11/2012 $35,000.009/11/2012 $35,000.0010/11/2012 $35,000.0011/11/2012 $35,000.0012/11/2012 $35,000.0013/11/2012 $35,000.0014/11/2012 $35,000.00

15/11/2012 $35,000.00

$35,000.00

Clients’ Account - Bank statement

Amount

Opening Balance

Closing balance

BalanceReference

numberDescriptionTransaction

date

Handy Tip:

Consider maintaining either an individual client money ledger or generic Client’s Account money ledger depending on the business model you have adopted.


8.5.2 An Example Operating Account Bank Statement

$25,000.00

CR DR1/07/2011 Bank fees 267810 7.00 $24,993.002/07/2011 $24,993.003/07/2011 $24,993.004/07/2011 $24,993.005/07/2011 Transer professional services fee - Mr John

Smith: Internal transfer – JS 1346267813 3,300.00 $28,293.00

6/07/2011 $28,293.007/07/2011 Staff w ages - Emma Smith 267816 1,200.00 $27,093.008/07/2011 $27,093.009/07/2011 Rent - Off ice premises 267819 3,500.00 $23,593.0010/07/2011 Electricity 267822 478.00 $23,115.0011/07/2011 Telephone 267822 162.00 $22,953.0012/07/2011 $22,953.0013/07/2011 Printing 267825 36.00 $22,917.0014/07/2011 $22,917.0015/07/2011 Draw ings - w ithdraw al by RMA 267828 1,500.00 $21,417.0016/07/2011 $21,417.0017/07/2011 Deposit by RMA 267831 1,350.00 $22,767.0018/07/2011 $22,767.0019/07/2011 $22,767.0020/07/2011 $22,767.0021/07/2011 $22,767.0022/07/2011 $22,767.0023/07/2011 $22,767.0024/07/2011 $22,767.0025/07/2011 $22,767.0026/07/2011 $22,767.0027/07/2011 $22,767.0028/07/2011 $22,767.0029/07/2011 $22,767.0030/07/2011 $22,767.00

31/07/2011 Credit interest 267834 3.05 $22,770.05

$22,770.05Closing balance

Amount

Operating Account - Bank statementOpening Balance

BalanceReference number

DescriptionTransaction date


8.5.3 An Example Clients’ Account Money Ledger

Date Description Reference Credit Debit

1/07/2011 Mr John Smith - File number JS - 1346 $5,798.00

2/07/2011 Disbursement - AFP police check - Mr John Smith Mr John Smith - File number JS - 1346 $38.00

3/07/2011 Disbursement - Medical examination - Mr John Smith Mr John Smith - File number JS - 1346 $260.00

3/07/2011 Ms Mary Brow n - File number MB - 1347 $5,798.00

4/07/2011 Disbursement - Visa application fee - Mr John Smith Mr John Smith - File number JS - 1346 $2,200.00

4/07/2011 Disbursement - AFP police check - Ms Mary Brow n Ms Mary Brow n - File number MB - 1347 $38.00

5/07/2011 Internal transfer - 1346 $3,300.00

6/07/2011

7/07/2011

8/07/2011 Disbursement - Medical examination - Ms Mary Brow n Ms Mary Brow n - File number MB - 1347 $260.00

9/07/2011 Disbursement - Visa application fee - Ms Mary Brow n Ms Mary Brow n - File number MB - 1347 $2,200.00

10/07/2011 Internal transfer - 1347 $3,300.00

11/07/201112/07/201113/07/201114/07/201115/07/201116/07/201117/07/201118/07/201119/07/201120/07/201121/07/201122/07/201123/07/201124/07/201125/07/201126/07/201127/07/201128/07/201129/07/201130/07/2011

Amount received in July 2011 $11,596.00 Total amount received into the clients’ account

Amount received from clients $11,596.00 Amount of advance paid by the client

Amount paid out on behalf of clients $4,996.00 Disbursements paid on behalf of clients

Agents residual professional services fee $6,600.00 Amount of professional fee transferred to the operating account

Bank Fees to be reimbursed $0 No bank fees charged on account

Credit interest attributable to the client $0 No interest accrues on account

Reconciliation of client ledger with clients’ account

Clients’ Account Money Ledger

Transfer to Operating account - John Smith professional fees

Transfer to Operating account - Mary Brow n professional fees

Advance payment from Ms Mary Brow n - payment covers disbursements and professional fees

Advance payment from Mr John Smith - payment covers disbursements and professional fees


9. Control and Supervision 9.1 Providing control and supervision

9 Control and Supervision9.1 Providing control and supervisionPart 8 of the Code of Conduct requires RMAs to ensure their employees comply in all respects with the requirements of the Code of Conduct.

To successfully discharge your obligations under part 8 of the Code of Conduct, you must ensure that all employees and persons assisting you and your clients are aware of the requirements of the Code of Conduct. This may be achieved by:

► providing a training session for staff on your obligations including the requirements and application of the Code of Conduct and their responsibilities to assist you in meeting those obligations; and

► setting out clear guidelines and expectations on what their duties encompass (for example, as set out in section 280(1) of the Migration Act 1958, they must not give immigration assistance if unregistered); and

► including a copy of the Code of Conduct in an employee’s induction pack and documenting acceptance by employees to having read and understood the Code.

You must ensure that work is only allocated to people who are competent to perform the tasks allocated to them. Moreover, work and services classified as immigration assistance may only be performed by an RMA.

The Code of Conduct requires you to ensure that the work of all employees is properly supervised. Supervision of work performed involves the following:

► Ensuring the work performed is the work delegated. This may be achieved by incorporating appropriate mechanisms for the review of work performed by junior employees and those who are not RMAs.

► Ensuring the work performed adheres to the Code of Conduct. This may be achieved by reviewing the work of employees in terms of their compliance with the requirements of the Code of Conduct.


Clause 8.1 of the Code of Conduct states:

“A registered migration agent has a duty to exercise effective control of his or her office for the purpose of giving immigration advice and assistance.”


10. Self Assessment Checklist 10.1 RMA self assessment checklist

10 Self Assessment ChecklistThe self assessment checklist at 10.1 may assist you in assessing your compliance relevant obligations under the Code of Conduct.

The checklist contains twenty seven questions in relation to the handling of client monies. Where you assess you may not be meeting the requirements, each question will direct you to the section of this toolkit intended to provide you with guidance on the Code of Conduct requirements and best practice for handling your client monies.

The checklist focuses on the following eight areas:

► Administrative requirements;

► Fee Estimates and Agreements for Services and Fees;

► Tax invoices and receipts;

► Processing disbursements;

► Statement of Services performed;

► Accounts and records management

► Control and supervision

► Dispute resolution


10.1 RMA Self Assessment Checklist

Administrative Requirements

Question number

Question Yes/No

1Do I have a separate bank account for client money which is has the words ‘Clients’ Account’ printed on the bank statement?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to 3.1 – How do I set up a Clients’ Account?

2Does my Clients’ Account have account keeping fees deducted from it?

If you answered yes, please refer to 3.1 – How do I set up a Clients’ Account?If you answered no, please proceed to the next question.

3Does my Clients’ Account earn interest?

If you answered yes, please refer to 3.1 – How do I set up a Clients’ Account? If you answered no, please proceed to the next question.

Fee Estimates and Agreements for Services and Fees

Question number

Question Yes/No

4Do I provide clients with a Fee Estimate?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to Chapter 4 – Providing clients with a Fee Estimate

5Does my Fee Estimate template include how I charge my clients i.e. 50% in advance balance on lodgement of their application etc?


6

Does my Fee Estimate template include how I process disbursements and provide an estimate of the expected disbursements to be incurred by my clients?


7Does my Fee Estimate template include sundry expenses that I will charge my clients such as faxes, couriers, postage, telephone calls etc?


8Does my Fee Estimate template disclose to my client which fees, charges and disbursements will be subject to GST?


9Does my Fee Estimate template include the acceptable payment methods by clients - i.e. credit cards, EFTPOS, cheques?


10

Do I obtain a signed Agreement for Services and Fees from my clients agreeing to my services and Fee Estimate before I commence work on their application?



Tax Invoices and Receipts

Question number

Question Yes/No

11 Do I issue clients with a valid receipt?

If you are unsure, please refer to Chapter 5 – Tax Invoices and Receipts 12 Do I provide clients with a valid invoice or a tax invoice?

If you are unsure, please refer to Chapter 5 – Tax Invoices and Receipts

13If I am required to issue an Invoice for a disbursement, do I state which disbursements are subject to GST and which disbursements are not subject to GST?

If you are unsure, please refer to Chapter 5 – Tax Invoices and Receipts

14

Do I calculate the correct amount of GST on an invoice for fees, charges and disbursements?

If you are unsure, please refer to Chapter 5 – Tax Invoices and Receipts and obtain independent GST advice from your accountant or the Australian Taxation Office.

Processing Disbursements Question number

Question Yes/No

15Do I correctly process and charge clients for disbursements?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to Chapter 6 – Processing Disbursements

16Do I provide clients with the original supplier receipt for disbursements processed from the Clients’ Account?


17

Do I issue clients with an invoice for disbursements processed from the Operating Account or business credit card before transferring client money to the Operating Account?


Statement of Services Performed

Question number

Question Yes/No

18

Do I issue a Statement of Services when I have finished work outlined in my Agreement for Services and Fees?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to Chapter 7 – Statement of Services

19

Do I issue clients with a Statement of Services when all agreed work in the Agreement for Services and Fees has been performed?


20

Do I issue clients with a Statement of Services within 28 days of a visa application decision?



Accounts and Records Management

Question number

Question Yes/No

21 Do I record all payments made by clients in the client ledger?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to Chapter 8 – Accounts and Records Management

22

Do I reference all transactions in the client and Operating Account, and these references match the client and operating ledgers?


23

Do I reconcile my bank accounts with the ledger or the computerised accounting system on a monthly basis to account for all client monies paid into and withdrawn from the Clients’ Account?


Control and Supervision

Question number

Question Yes/No

24

Do I have training sessions for all employees and persons assisting me and my clients to ensure that they are aware of the requirements of the Code of Conduct?

If you have answered yes, then please proceed to the next question.If you answered no, please refer to Chapter 9 – Control and Supervision

25

Do I have procedures in place to confirm that the work of all employees is properly supervised (ie work is only allocated to staff who are competent to perform their work, their work is reviewed to ensure that it has been completed properly and that it has been completed in accordance with the Code of Conduct)?


26

Do I ensure that all immigration assistance given to my clients is only provided by registered migration agents?


Dispute resolution

27

Does my standard Agreement for Services and Fees make reference to a mechanism for resolving any disputes that might arise?

To reduce the risk of disputes arising, it is recommended that you have internal dispute resolution processes in place. You are encouraged to attempt to resolve fee disputes with your clients through this internal process.



Clause 7.4 of the Code of Conduct states:

“A registered migration agent must keep records of the Clients’ Account, including:

a) the date and amount of each deposit made to the clients’ account, including an indication of the purpose of the deposit and the client on whose behalf the deposit is made; and

b) the date and amount of each withdrawal made in relation to an individual client, and the name of each recipient of money that was withdrawn; and

c) receipts for any payments made by the client to the agent; and

d) Statement of Services; and

e) copies of invoices or accounts rendered in relation to the account.”

client monies toolkit - migration agents registration

Documents