Compliance Mistakes

Making Unclaimed Property Compliance mistakes by not properly reporting and remitting Unclaimed Property can potentially trigger an Unclaimed Property Audit AND can cause penalties and interest. Also, your company can even be charged the cost of the audit! The important concept here is triggering an audit. So be proactive and limit the amount of Unclaimed Property Compliance mistakes before you get audited.

As was discussed on previous pages, the time and cost of being audited for Unclaimed Property may be demanding. However, the time to comply with Unclaimed Property law, although initially challenging, can usually be absorbed by existing accounting departments without significant additional headcount. It would be more prudent to comply with Unclaimed Property law in the first place and not make Unclaimed Property Compliance mistakes, thereby reducing your company’s risk for an Unclaimed Property Audit.

Also, consider reviewing NAUPA’s report on “The Essentials of Reporting & Compliance” found here – http://www.unclaimed.org/uploads/resources/86/up-tue-300-unclaimed-property-101-and-more.pdf

Here are the most common Unclaimed Property Compliance mistakes:

  • Failing to utilize experienced Unclaimed Property advisers to set-up, evaluate and maintain proper Unclaimed Property policies and procedures
  • Reporting and remitting Unclaimed Property after applicable deadlines
  • Not reporting and remitting Unclaimed Property to all applicable states
  • Incorrectly reporting Unclaimed Property (missing data, improper property types, etc.)
  • Reporting and remitting Unclaimed Property using incorrect dormancy periods
  • Not reporting your company‚Äôs stock and dividends held by transfer agent
  • Failing to inform Unclaimed Property owners according to state law
  • Not retaining data to support Unclaimed Property record keeping for required periods to time (potentially 20 years or more)
  • Not filing Unclaimed Property reports when there is no Unclaimed Property to report or remit – some states require reports whether or not your company has Unclaimed Property to report
  • When realizing your company is in non-compliance with Unclaimed Property law, not initiating Voluntary Disclosure Agreements to limit the reporting period, fees and interest with states where you are in non-compliance